FBI posts sales, income decreases in 1Q
By Furniture Today Staff -- Furniture Today, April 27, 2003
St. Louis — Full-line manufacturer and importer Furniture Brands International reported first-quarter sales of $613.8 million and net income of $29 million, decreases of 3.2% and 11.4%, respectively, from last year's first three months.
"As expected, business conditions in the first quarter of 2003 continued to be challenging," said Mickey Holliman, chairman, president and chief executive. "The soft business environment was exacerbated by the adverse weather conditions that negatively affected both manufacturing and retailing efforts."
Furniture Brands continues to grow its dedicated store program. Holliman said another Henredon store will open in California's Orange County, joining the existing store in Houston, and that the number of Henredon stores could go as high as 20.
FBI is changing its definition of Thomasville stores versus galleries, and has lowered the current store count from 161 to 150. About 20 new Thomasville stores are planned for this year.
Furniture Brands now has 13 million square feet of dedicated galleries or freestanding stores at retail, and will continue to grow that 5% a year, Holliman said.
While the high end continues to have problems, he said the Drexel Heritage, Henredon, Maitland-Smith and Thomasville divisions broke even in the first quarter, an improvement over last year.
While they exceeded the performance of the high-end divisions, Lane and Broyhill also experienced more difficult business in the quarter. Broyhill, Holliman said, "has been investing in discounting to drive the revenue line without much success."
Order-writing at Lane and Broyhill was down 1.75% from the first quarter of 2002, he said.
Holliman noted the recent appointment of Tom Tilley as president of Thomasville, and called the move more of a "bend" versus fixing something that was broken. Tilley, he said, will concentrate on refreshing the product line.
FBI revised its full-year guidance to assume no sales growth, but Holliman believes pent-up demand at the high end could break around the end of June, and he has no fears of consumers at that level trading down.
"People driving BMWs aren't downgrading to Pontiacs and Fords, and we think that's applicable in furniture," he said.
| Furniture Brands International | |||
|---|---|---|---|
| Owns Broyhill, Drexel Heritage, Henredon, Lane, Maitland-Smith and Thomasville | |||
| Earnings per share are fully diluted, and all figures in parentheses are loses or declines. | |||
| Quarter ended 3/31 | 2003 | 2002 | Change |
| Sales | $613,844,000 | $634,461,000 | (3.2%) |
| Operating income | 63,157,000 | 67,912,000 | (7.0%) |
| Net income | 29,041,000 | 32,771,000 | (11.4%) |
| Earnings per share | 0.52 | 0.58 | (10.3%) |
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