Rowe turns $2.1M profit in 4Q
By Furniture Today Staff -- Furniture Today, January 20, 2003
McLean, Va. — The Rowe Cos. reported profits of $2.1 million in its fourth quarter and $2 million for the year — a turnaround from a loss the previous year, which the company attributed to improvements at both its retail and manufacturing operations.
For the quarter ended Dec. 1, net shipments were up 3% to $87.1 million and Rowe's gross profit margin increased to 36.5% from 33.5%.
The $2.1 million in net income was up from $619,000 in the same quarter a year ago.
For the year, shipments increased 2.8% to $334.6 million and the gross profit margin increased to 34.5% from 32.4%. The $2 million in net income for the year reversed a $6.2 million loss in the previous year.
Rowe posted the fiscal 2002 profit despite taking a $1.7 million after-tax charge for its move to consolidate retail operations under the Storehouse name.
The company "had a strong recovery in 2002," said Gerald Birnbach, chairman and president, adding that manufacturing operations posted solid improvements in the fourth quarter.
"Both our Rowe Furniture and Mitchell Gold business units delivered very strong manufacturing efficiencies, which are reflected in our improved gross margins for the quarter," he said.
Storehouse posted a 3.5% same-store sales gain in the fourth quarter, he said, but recorded a loss for the period.
The company said it may open three to five more stores this year — weighted in the second half — in existing markets.
Birnbach said the company is entering this year "cautiously optimistic" the turnaround will continue despite the uncertain market conditions.
He said Rowe expects its new furniture brands — Robin Bruce and Jamie L Designs — will continue to grow, and that last year's consolidation of Storehouse and Home Elements into one 60-store chain will continue to benefit the company.
| The Rowe Cos. | |||
|---|---|---|---|
| Owns Rowe Furniture, The Mitchell Gold Co. and Storehouse | |||
| Earnings per share are fully diluted, and all figures in parentheses are losses or declines. | |||
| Quarter ended 12/1 | 2002 | 2001 | Change |
| (a) Includes pretax retail restructuring charges of $262,000 in the 2002 quarter and $2.4 million in the 2002 year. (b) Based on average shares outstanding of 13.2 million in the 2002 periods, 13.4 million in the 2001 quarter and 13.1 million in the 2001 year. (c) Includes a $2.9 million income tax benefit. | |||
| Sales | $87,138,000 | $84,579,000 | 3.0% |
| Operating income | 5,749,000 | 2,188,000 | 162.8% |
| Net income | (a)2,133,000 | 619,000 | 244.6% |
| Earnings per share (b) | 0.16 | 0.05 | 220.0% |
| Year ended 12/1 | 2002 | 2001 | Change |
| Sales | $334,610,000 | $325,438,000 | 2.8% |
| Operating income | 11,001,000 | (5,766,000) | — |
| Net income | (a)2,020,000 | (c)6,189,000) | — |
| Earnings per share (b) | 0.15 | (0.47) | — |
