Losses mount at Quaker Fabric as 4Q sales drop 26.3%
Down 22.3% for the year
By Furniture Today Staff -- Furniture Today, February 15, 2006
FALL RIVER, Mass. — Hurt by declining sales, Quaker Fabric posted a loss of $4.8 million, or 28 cents per share, in the fourth quarter and $25.4 million, or $1.51 per share, for the year.
The upholstery fabric supplier reported sales of $50.1 million in the quarter, down 26.3% from the comparable quarter in 2004. For the year, sales of $224.7 million were down 22.3%.
Quaker took one-time restructuring charges amounting to $13.9 million after taxes during the year. Excluding those charges, and a $1.2 million tax credit in the second quarter, the net loss for 2005 was $12.6 million, the company said.
In 2004, the company had net losses of $1.9 million, or 11 cents per share, in the fourth quarter and $2 million, or 12 cents per share, for the year.
“Last year was a major disappointment for Quaker,” said President and CEO Larry Liebenow “The continued strength of leather, faux suede and woven fabric products in the U.S. market led to a 22.3% falloff in our total revenues, with domestic and international fabric sales for the year of $173.6 million and $29.3 million, down 25.4% and 18.4%, respectively.”
Yarn sales, however, were up 6.7% to $21.8 million, he said.
“We did achieve a number of important objectives last year,” Liebenow said, including reducing the company’s cost structure by $40 million a year, consolidating operations, putting a new credit facility in place, and reducing debt by $2.1 million. But the sales decline outpaced the savings, he said.
“We are determined that 2006 will see a significant improvement in our financial results — and we believe that the steps we took during 2005 and so far this year have set the stage for that,” he said.
Among other steps, the company will look to build sales with its first collections of outsourced fabrics, and will develop products best produced at its U.S. plants, including outdoor and contract fabrics, said Liebenow.
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Quaker posts larger 4Q loss as sales sink 26.3%
Mar 5, 2006
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