## **UNITED STATES**

**SECURITIESAND EXCHANGE COMMISSION**

**WashingtonD.C. 20549**

 

## **FORM 10-Q/A**

(Amendment No. 2)

 

**(Mark One)**

 

**ý****                                                                                 QUARTERLYREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF1934**

 

For the quarterly period ended **July 31,2004**

 

**or**

 

**o****                                                                                 TRANSITIONREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF1934**

 

**For thetransition period from                      to**

 

**Commissionfile number 1-13026**

 

**BLYTH,INC.**

(Exact name of registrantas specified in its charter)

 

 

| **DELAWARE**                                                    | ** ** | **36-2984916**                     |
|-----------------------------------------------------------------|------------|------------------------------------|
| (State or Other  Jurisdiction of Incorporation or Organization) |       | (IRS Employer  Identification No.) |
|                                                            |       |                               |
| **One  East Weaver Street, Greenwich, Connecticut  **      |       | **06831**                          |
| (Address of Principal  Executive Offices)                       |       | (Zip Code)                         |

 

**(203)661-1926**

(Registrant’s TelephoneNumber, including Area Code)

 

# **Not Applicable**

(Former Name, FormerAddress and Former Fiscal Year, if Changed Since Last Report)

 

Indicate by check mark whether the registrant (1) hasfiled all reports required to be filed by Section 13 or 15(d) of theSecurities Exchange Act of 1934 during the preceding 12 months (or for suchshorter period that the registrant was required to file such reports), and (2)has been subject to such filing requirements for the past 90 days.

 

Yes  ý        No  o

 

Indicate by check mark whether the registrant is anaccelerated filer (as defined in Rule 12b-2 of the Exchange Act).

 

Yes  ý        No  o

 

Indicate the number ofshares outstanding of each of the issuer’s classes of common stock, as of thelatest practicable date.  **40,901,011 Common Shares as of August 31, 2004**

** **

** **

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**ExplanatoryNote**

 

In our filing on Form 10-Q/A Amendment No. 1 for thequarter ended July 31, 2004 filed with the Securities and Exchange Commissionon December 16, 2004 we disclosed that the interim financial statements for thethree and six month periods ended July 31, 2003 included therein had not beenreviewed by an independent registered public accounting firm, as required bySection 10-01(d) of Regulation S-X.  ThisForm 10-Q/A Amendment No. 2 is being filed to remedy that deficiency.

 

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**Item 4. Controls and Procedures**

 

(a) Evaluation of disclosure controls and procedures.

 

Our management, with the participation of ourprincipal executive officer and our principal financial officer, evaluated theeffectiveness of our disclosure controls and procedures (as defined inSecurities Exchange Act of 1934 (“Exchange Act”) Rules 13a-15(e) or 15d-15(e))as of the end of the period covered by this quarterly report as required byparagraph (b) of Exchange Act Rules 13a-15 or 15d-15.  Based upon thisevaluation, our principal executive officer and our principal financial officerhave concluded that our disclosure controls and procedures were effective atthe reasonable assurance level as of the end of the period covered by thisquarterly report.

 

(b) Changes in internal control over financialreporting.

 

There was no change in our internal control overfinancial reporting identified in connection with the evaluation required byparagraph (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during ourlast fiscal quarter that has materially affected, or is reasonably likely tomaterially affect, our internal control over financial reporting.

 

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**PART II.**  **OTHERINFORMATION**

 

**Item 5.**   **OtherInformation**

 

In our filing on Form 10-Q/A Amendment No. 1 for thequarter ended July 31, 2004 filed with the Securities and Exchange Commissionon December 16, 2004 we disclosed that the interim financial statements for thethree and six month periods ended July 31, 2003 included therein had not beenreviewed by an independent registered public accounting firm, as required bySection 10-01(d) of Regulation S-X.  ThisForm 10-Q/A Amendment No. 2 is being filed to remedy that deficiency.

 

The staff of the Commission may take the position thatbecause certain information relating to our prior fiscal year in our QuarterlyReports for fiscal 2004 and 2005 had not been reviewed by any independentpublic accountants prior to filing as required by Section 10—01(d) ofRegulation S—X, we would not have been viewed as having made all requiredfilings until the reports are amended to reflect the required review, and eventhen that the filings were not filed timely. Therefore, we could be ineligible to use Forms S—2 and S—3 to registersecurities (or amend an existing registration statement) until all requiredreports under the Exchange Act have been timely filed for the 12 months priorto the filing of the registration statement or amendment. While ineligibilityto use Form S—2 or S—3 would involve additional expense should we need to fileor amend a registration statement, we do not view ineligibility as having amaterial adverse effect on our access to capital resources.

 

The Company is including the following cautionarystatement in this Report to make applicable, and to take advantage of, the safeharbor provisions of the Private Securities Litigation Reform Act of 1995 forany forward-looking statements made by, or on behalf of, the Company. Forward-looking statements include statements concerning plans, objectives,goals, strategies, future events or performance and underlying assumptions andother statements, which are other than statements of historical facts. From time to time, the Company and its representatives may publish or otherwisemake available forward-looking statements of this nature.  All suchforward-looking statements, whether written or oral, and whether made by or onbehalf of the Company, are expressly qualified by the following cautionarystatements.  Forward-looking statements involve risks and uncertainties,which could cause actual results or outcomes to differ materially from thoseexpressed in the forward-looking statements.  Such forward-lookingstatements are expected to be based on various assumptions, many of which arebased, in turn, upon further assumptions.  There can be no assurance thatmanagement’s expectations, beliefs or projections will occur or be achieved oraccomplished.  In addition to other factors and matters discussedelsewhere in this Report and in the Company’s other public filings andstatements, the following are important factors that, in the view of theCompany, could cause actual results to differ materially from those discussedin the Company’s forward-looking statements.  The Company disclaims anyobligation to update any forward-looking statements, or the following factors,to reflect events or circumstances after the date of this Report.

 

#### **Risk of Inability to Maintain Sales Growth Rate**

 

The Company has experienced significant sales growthin past years.  While management expects continued growth, our futuregrowth rate will likely be less than our historical growth rate.  The Companyexpects faster sales growth in its international market versus its UnitedStates market, particularly in the Direct Selling and Wholesale segments. The Company’s ability to increase sales depends on numerous factors, includingmarket acceptance of existing products, the successful introduction of newproducts, the increase in consumers’ discretionary spending, the ability torecruit new independent sales consultants, sourcing of raw materials anddemand-driven increases in production and distribution capacity.  Businessin all of our segments is driven by consumer preferences.  Accordingly,there can be no assurances that the Company’s current or future products willmaintain or achieve market acceptance.  Our sales and earnings results canbe negatively impacted by the worldwide economic environment, particularly theCanadian, United States and European economies. There can be no assurances thatthe Company’s financial results will not be materially adversely affected bythese factors in the future.  The Company’s historical growth has been duein part to acquisitions and management continues to consider additionalstrategic acquisitions.  There can be no assurances that management willcontinue to identify suitable acquisition candidates, consummate acquisitionson terms favorable to the Company, finance acquisitions or successfullyintegrate acquired operations.

 

#### **Risks Associated with International Sales andForeign-Sourced Products**

 

#### **Ourinternational sales growth rate has outpaced our United States growth rate inrecent years.  Moreover, the Company**

 

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sources a portion of its products in all of itsbusiness segments from independent manufacturers in the Pacific Rim, Europe andMexico.  For these reasons, we are subject to the following risksassociated with international manufacturing and sales:  fluctuations incurrency exchange rates, economic or political instability, internationalpublic heath crises, transportation costs and delays, difficulty in maintainingquality control, restrictive governmental actions, nationalizations, the lawsand policies of the United States, Canada and certain European countriesaffecting the importation of goods (including duties, quotas and taxes) and thetrade and tax laws of other nations.

 

#### **Ability to Respond to Increased Product Demand**

 

The Company’s ability to meet future product demand inall of its business segments will depend upon its success in (1) bringing newproduction and distribution capacity on line in a timely manner, (2) improvingits ability to forecast product demand and fulfill customer orders promptly,(3) improving customer service-oriented management information systems and (4)training, motivating and managing new employees.  The failure of any of theabove could result in a material adverse effect on our financial results.

 

#### **Risk of Shortages of Raw Materials**

 

Certain raw materials could be in short supply due tocapacity, availability, a change in requirements, weather or other factors,including supply disruptions due to production or transportation delays. Such shortages have not had and are not presently expected to have a materialadverse effect on the Company’s operations.  While the price of crude oilis only one of several factors impacting the price of petroleum wax, it ispossible that recent fluctuations in oil prices may have a material adverseaffect on the cost of petroleum-based products used in the manufacture ortransportation of our products, particularly in the Direct Selling and Wholesalesegments.

 

#### **Dependence on Key Corporate Management Personnel**

 

Our success depends in part on the contributions ofkey corporate management, including our Chairman and Chief Executive Officer,Robert B. Goergen.  The Company does not have employment contracts withany of its key corporate management personnel except Mr. Goergen, nor does itmaintain any key person life insurance policies.  The loss of any of thekey corporate management personnel could have a material adverse effect on theCompany.

 

#### **Risk of Increased Competition**

 

Our business is highlycompetitive both in terms of pricing and new product introductions.  Theworldwide market for home expressions products is highly fragmented withnumerous suppliers serving one or more of the distribution channels served bythe Company.  In addition, the Company competes for direct sellingconsultants with other direct selling companies.  Because there arerelatively low barriers to entry in all of our business segments, the Companymay face increased competition from other companies, some of which may havesubstantially greater financial or other resources than those available tous.  Competition includes companies selling candles manufactured at lowcost outside of the United States.  Moreover, certain competitors focus ona single geographic or product market and attempt to gain or maintain marketshare solely on the basis of price.

 

**Risks Related to InformationTechnology Systems**

 

Our information technology systems are dependent onglobal communications providers, telephone systems, hardware, software andother aspects of Internet infrastructure that have experienced significantsystem failures and outages in the past.  Our systems are susceptible tooutages due to fire, floods, power loss, telecommunications failures, break-insand similar events.  Despite the implementation of network securitymeasures, the Company’s systems are vulnerable to computer viruses, break-insand similar disruptions from unauthorized tampering with Company systems. The occurrence of these or other events could disrupt or damage our informationtechnology systems and inhibit internal operations, the ability to providecustomer service or the ability of customers or sales personnel to access theCompany’s information systems.

 

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**Item 6.****   ****Exhibits**

 

a)     Exhibits

 

31.1           Certification of Chairman, and Chief Executive Officerpursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.

 

31.2           Certification of Vice President and Chief FinancialOfficer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934.

 

32.1             Certification of Chairman and Chief Executive Officerpursuant to Section 906 of the Sarbanes-Oxley Act of  2002.

 

32.2             Certification of Vice President and Chief FinancialOfficer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 

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### **SIGNATURES**

 

Pursuant to therequirements of the Securities Exchange Act of 1934, the registrant has dulycaused this report to be signed on its behalf by the undersigned thereunto dulyauthorized.

 

 
|   |           | BLYTH, INC. |
|--------|----------------|-------------|
| Date:  | April 14, 2005 |        | By: | /s/  Robert B. Goergen |
|   |           |        | Robert B. Goergen |
|   |           |        | Chairman and Chief Executive  Officer |
|   |           |        |   |
| Date:  | April 14, 2005 |        | By: | /s/  Robert H. Barghaus |
|   |           |        | Robert H. Barghaus |
|   |           |        | Vice President and Chief Financial  Officer |

 

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