Hamilton Beach 2011 Annual Report Download - page 16

increased placements and branding
programs, together with appropriate levels
of advertising for the company’s highly
successful and innovative product lines,
such as The ScoopTM, a new single-serve
coffee maker. Hamilton Beach’s line of
Melitta®-branded beverage appliances,
introduced in late 2010, enhanced its
position in 2011. In addition, The ScoopTM
and its family of products, as well as the
new DurathonTM iron product line, both
introduced in late 2011, were well-received.
HBB expects all of these products to
continue to gain market position over time
as broader distribution is attained. The
company is also continuing to introduce
innovative products in several other small
appliance categories. These products, as
well as other new product introductions in
the pipeline for 2012 and future years, are
expected to affect revenues and operating
profit positively. However, as a result of the
weak U.S. consumer market, Hamilton
Beach currently anticipates only a modest
increase in 2012 revenues compared
with 2011.
Overall, Hamilton Beach expects 2012
net income to increase modestly compared
with 2011. The company’s goal is to
manage costs and expenses effectively
while focusing on gaining placements to
drive top-line growth. Nevertheless, product
costs are expected to increase modestly
in the first half of 2012, but then level out
for the second half of the year, while trans-
portation costs are expected to increase in
the second half of 2012. Hamilton Beach
continues to monitor commodity costs
closely and expects to adjust product
prices and placements as appropriate,
if these costs increase more than antici-
pated. Hamilton Beach expects that 2012
cash flow before financing activities will
be modestly lower than in 2011 as a
result of increased working capital to fund
revenue growth.
Longer-Term Perspective
HBB will continue to focus on its areas
of excellence–customer service, fact-
based professional sales and marketing
and global sourcing. In addition, in 2012
and going forward, a critical focus for HBB
will be to ensure the continued high quality
of its global contract manufacturing. HBB
will also continue to invest in providing its
customers innovative, quality products
and value-added services throughout the
middle market to ensure the company’s
products remain a critical part of its
customers’ assortment plans.
Important promotional campaigns
designed to support HBB’s brands and
new products are expected to continue.
The company’s product and placement
track record continues to be robust due to
innovation processes centered on under-
standing and meeting end-user needs. In
the U.S. consumer market, HBB believes
it has a stronger and deeper portfolio of
new products than its competitors and an
industry-leading level of innovation, with
Top: The newest version of the Hamilton
Beach®Stay or Go®6 quart portable slow
cooker
Center: Hamilton Beach®Big Mouth®
Duo Plus food processor
Bottom: Hamilton Beach®Belgian-Style
waffle maker
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