Bassett 4Q sales up 4.4%, off 2% for year
By Powell Slaughter -- Furniture Today, January 18, 2004
BASSETT, Va. — Full-line manufacturer-importer Bassett Furniture Inds. reported fiscal fourth-quarter sales of $82.9 million and net income of $3.2 million, increases of 4.4% and 92.3%, respectively, over the prior year's final quarter.
For the year ended Nov. 29, 2003, the company said sales of $316.9 million were off 2% from 2002. Bassett lost $470,000 in the latest year, compared to prior-year net income of $6.7 million. The 2003 loss included a previously announced $3.2 million charge related to the first-quarter closing of Bassett's Dublin, Ga., factory.
"Although we are not pleased with our overall earnings results for 2003, we are encouraged with the progress we demonstrated in the fourth quarter, the cash flow that we generated during the year, and the backlog of prospects we developed in 2003 who will open new Bassett Furniture Direct stores in 2004," said Rob Spilman, president and chief executive officer.
"We expect 2004 to be a record year for opening BFDs and remain committed to our goal of 150 BFD stores by the end of 2005," he said.
Bassett's sales to BFD stores were 53% of its total wholesale sales in 2003, and that figure is expected to rise to about 63% in 2004.
There currently are 100 BFD stores in operation. Licensees opened 19 stores in 2003, and Bassett expects licensees to open 20 to 25 stores in fiscal 2004, spread evenly over the year.
The company's primary focus continues to be on expanding and improving the store program, "while we take the necessary actions to continue to deliver value to our retail customers and further improve our operating earnings," Spilman said.
In addition to increased sales to more BFD stores, Bassett attributed the fourth-quarter improvements to manufacturing productivity gains, and to successful inventory reduction programs late in the year. Manufactured inventory levels were cut by $4 million in the fourth quarter and $10 million for the year, which in turn lowered related reserves, resulting in around $1 million of additional gross profit in the fourth quarter, the company said.
Bassett attributed the full year's sales decline to a $17 million drop in sales to JCPenney, partially offset by the consolidation of retail sales at six BFD stores Bassett acquired from LRG Furniture in 2002. The company also noted that fiscal 2002 included an extra week of sales.
Fourth-quarter gross profit and selling, general and administrative expenses also were affected by the consolidation of LRG Furniture. Gross margin for the quarter improved by nearly six percentage points from the prior year's fourth quarter. About 60% of this improvement was due to the LRG consolidation, and about 40%, or 2.2 percentage points, resulted from improved productivity and inventory reductions.
The consolidation of LRG's selling expenses into Bassett's results led to a $4.1 million increase in SG&A expenses during the latest quarter. Other income was higher in both the fourth quarter and year, due primarily to better returns from the company's investment portfolio.
The company is further consolidating upholstery production from a smaller facility in Hiddenite, N.C., to its primary upholstery facility in Newton, N.C. Bassett expects to incur a restructuring charge in the range of $600,000 to $1 million in 2004's first quarter with the Hiddenite closure and related actions.
When the consolidation is complete, Bassett will have reduced the number of factories from 13 in early 2001 to seven in early 2004, significantly lowering its fixed cost structure.
"December order and shipment levels have been soft, and business conditions for our company and our industry remain challenging," Spilman said. "We are cautiously optimistic as we enter the new year, hard at work on new products which we will introduce in April, and on our plans to strengthen our presence on the West Coast, including new stores in 2004, and a new distribution center and a small upholstery operation in 2005 to support this growth."
| Bassett Furniture Inds. | |||
|---|---|---|---|
| Owns Bassett Glass, Bassett Motion, Bassett Supply and Weiman | |||
| Earnings per share are fully diluted, and all figures in parentheses are loses or declines. | |||
| 13 weeks ended 11/29 | 2003 | 2002 | Change |
| (a) Includes net non-operating income of $1.4 million in the 2003 13 weeks and $1 million in the 2002 13 weeks. (b) The 2003 year is 52 weeks; the 2002 year is 53 weeks. (c) Includes net non-operating income of $6.1 million in the 2003 year and $2.9 million in the 2002 year and pretax restructuring and asset impairment charges of $3.2 million in the 2003 year and $1.3 million in the 2002 year. The 2003 year also includes a $4.9 million extraordinary charge, the cumulative effect of an accounting change. |
|||
| Sales | $82,944,000 | $79,428,000 | 4.4% |
| Operating income | 2,384,000 | 766,000 | 211.2% |
| Net income (a) | 3,205,000 | 1,667,000 | 92.3% |
| Earnings per share | 0.28 | 0.14 | 100.0% |
| Year ended 11/29 (b) | 2003 | 2002 | Change |
| Sales | $316,857,000 | $323,487,000 | (2.0%) |
| Operating income | 1,970,000 | 7,507,000 | (73.8%) |
| Net income (c) | (470,000) | 6,741,000 | — |
| Earnings per share | (0.04) | 0.57 | — |
-
Bassett 3Q earnings fall 27.6%
Oct 17, 2004 -
Bassett earnings decline 82.6% in 4Q
Feb 11, 2007 -
Bassett posts smaller loss
Jul 20, 2008 -
Bassett 4Q sales down 3.4%
Jan 30, 2005 -
Bassett 4Q sales down 3%
Jan 11, 2005
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