HUNTSVILLE, AL – Lakeland Industries Inc. (NASDAQ:LAKE), a leading manufacturer of industrial protective clothing, announced a change in its independent accounting firm, according to a recent 8-K filing with the Securities and Exchange Commission (SEC).
Effective October 11, 2024, the company's Audit Committee dismissed Deloitte & Touche LLP and appointed RSM US LLP as the new independent auditor for the upcoming quarter ending October 31, 2024. The reports from Deloitte on Lakeland's financial statements for the fiscal years ending January 31, 2023, and January 31, 2024, contained no adverse opinions and were not qualified on any audit scope or accounting principles.
The change occurred without any disagreements between the company and Deloitte on matters of accounting principles or practices, financial statement disclosure, or auditing scope or procedures up to the date of dismissal. However, a material weakness had been identified in the past. Deloitte's report on April 17, 2023, noted a material weakness in internal controls over financial reporting related to foreign subsidiary currency translation, which had been remediated by January 31, 2024, as reported in Lakeland's Annual Report.
Lakeland Industries provided Deloitte with a copy of the 8-K report prior to filing with the SEC and requested a letter from Deloitte to the SEC regarding their agreement with the statements made. Deloitte's letter, dated October 18, 2024, is included in the filing as Exhibit 16.1.
In other recent news, Lakeland Industries reported a mixed fiscal second quarter for 2025. The company experienced a 16% rise in trailing twelve-month (TTM) revenue, amounting to $38.5 million in Q2, despite an operating loss caused by integration and acquisition-related costs. However, the company's acquisition of LHD has expanded its fire services globally and introduced a new recurring revenue stream.
Sales growth was seen in Latin America and other markets, although there was a slight decline in the US and Europe. The gross profit margin fell from 42.9% to 39.6%, resulting in a net loss of $1.4 million for the company. Despite these challenges, Lakeland Industries maintains its fiscal year 2025 revenue guidance of $160 million to $170 million and adjusted EBITDA of $18 million to $21.5 million.
Lakeland Industries is confident in its growth strategy, focusing on expanding its fire services offerings and improving industrial sales and customer service in Europe. The company is also aiming to expand the service maintenance business acquired from LHD into other regions. These recent developments suggest that Lakeland Industries is actively working to overcome current obstacles and capitalize on new opportunities.
InvestingPro Insights
To complement the article on Lakeland Industries Inc.'s (NASDAQ:LAKE) change in independent accounting firm, recent financial data from InvestingPro provides additional context for investors. As of the last twelve months ending Q2 2025, Lakeland Industries reported revenue of $137.74 million, with a notable revenue growth of 15.6%. This growth aligns with an InvestingPro Tip indicating that analysts anticipate sales growth in the current year.
The company's financial health appears stable, with an InvestingPro Tip highlighting that liquid assets exceed short-term obligations, suggesting a solid financial position as Lakeland transitions to a new auditor. Additionally, the company operates with a moderate level of debt, which may provide flexibility in its operations.
Investors should note that Lakeland Industries is trading at a high earnings multiple, with a P/E ratio of 79.85. This valuation metric, along with the company's market capitalization of $153.55 million, may be important factors for investors to consider in light of the recent auditor change and the previously identified (and remediated) material weakness in internal controls.
For those seeking a more comprehensive analysis, InvestingPro offers 8 additional tips for Lakeland Industries, providing a deeper understanding of the company's financial position and market performance.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.