Quaker 1Q sales fall 29.8%; net loss comes to $3.1 million
Janice Chamberlain -- Furniture Today, April 24, 2005
Fall River, Mass. — First-quarter sales for Quaker Fabric fell 29.8% to $59.2 million from $84.4 million in the comparable 2004 period, and the fabric supplier recorded a net loss of $3.1 million, compared with profits of $2.4 million a year ago.
President and CEO Larry Liebenow said, "Domestic and international fabric sales of $46.3 million and $7.2 million, respectively, were off 33.2% and 21.1%, respectively, versus last year — largely because of the continued strength of imported leather and faux suede products in the U.S. market, which has reduced demand for the woven fabrics we make, and general economic weakness in a number of the export markets we serve."
The balance of Quaker's sales, $5.7 million, were yarn sales, primarily into the craft yarn segment.
In a conference call with analysts, Quaker Chief Financial Officer Paul Kelley said first-quarter sales to unaffiliated customers in Canada were off 21%, in comparison with year-earlier results, while sales to Mexico fell 31%, the Near East was off 34%, European sales dropped 31% and sales to other international customers slid 19%.
On the positive side, South American sales grew 39%.
Kelly said the weighted average price point was $5.74, up 2% from a year ago.
Liebenow said, "We have been working diligently to reduce our costs, and our monthly financial performance so far this year reflects sequential improvement. However, most of the benefits associated with our cost-cutting efforts are not yet evident in our financials.
"Weak demand was the biggest issue in the quarter," he added. "It's too soon to see revenue growth as a result of the initiatives we've implemented. However, we ended the quarter with an order backlog valued at about $28 million, compared to $14.6 million at year-end 2004 and $25.8 million at the end of last year's first quarter."
In the latest quarter, Quaker's product mix shifted slightly to 28.7% promotional fabric from 28% a year ago, with the balance in better fabrics.
| Quaker Fabric | |||
|---|---|---|---|
| Earnings per share are fully diluted, and all figures in parentheses are losses or declines. | |||
| Quarter ended 4/2 | 2005 | 2004 | Change |
| (a) Includes a $2.2 million income tax benefit. | |||
| Sales | $59,215,000 | $84,384,000 | (29.8%) |
| Operating income | (4,468,000) | 4,670,000 | — |
| Net income | (a)(3,090,000) | 2,438,000 | — |
| Earnings per share | (0.18) | 0.14 | — |
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Quaker 1Q sales down 29.8%
Apr 21, 2005
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