Lacquer Craft 2005 sales up 13%, profits up 27.1%
By Thomas Russell -- Furniture Today, May 15, 2006
Dongguan, China — Samson Holding, owner of Chinese case goods manufacturer Lacquer Craft, said sales increased 13% last year and profits rose 27.1%.
Its annual report said sales grew to $517 million in 2005 from $457.5 million in 2004. Profits rose to $89 million, or 3.8 cents per share, from $70.1 million, or 3 cents per share, in 2004.
Samson Holding is traded on the Hong Kong Stock Exchange. About 90% of its sales is furniture sold in the United States. Branded business, through U.S. marketing arms Universal Furniture and Legacy Classic, was 88.2% of total sales, or $455.8 million, while OEM business accounted for 11.8% or $61.2 million.
The percentages were similar in 2004.
Samuel Kuo, executive director and board chairman, said profits slightly exceeded the $88 million forecast in a Nov. 7 prospectus.
He added that despite competition and consolidation in the furniture industry, the company should continue to grow.
"Our principal goal is to maintain and strengthen our position as one of the leading wholesalers in the U.S. residential furniture market and to become one of the leading players in the furniture industry globally," he said.
The company expects to expand its lines of upholstery, home office, youth and home entertainment furniture, Kuo said.
The company's plants in Jiashan and Dongguan are adding production lines. When that is completed in late 2007, they will produce an additional 1,000 and 1,200 containers a month of residential furniture. Last November, the two had a combined capacity of 2,200 containers a month.
Kuo said growth also could occur through acquisitions. Lacquer Craft recently said it had acquired a U.S. upholstery maker Craftmaster.
The company plans to boost procurement efficiencies and improve its supply chain management, he said, which should lead to future cost savings and better delivery times. Moreover, he said the company strives to shorten product development cycles and streamline production processes through increased collaboration of engineering and design teams and by continuing to hire skilled workers.
"We believe the ability to grow as a successful business depends on the quality of our management and employees," Kuo said.
| Samson Holding | |||
|---|---|---|---|
| Owns Lacquer Craft | |||
| Earnings per share are basic, not fully diluted. | |||
| Year ended 12/31 | 2005 | 2004 | Change |
| Sales | $517,039,000 | $457,542,000 | 13.0% |
| Operating income | 95,509,000 | 73,820,000 | 29.4% |
| Net income | 89,032,000 | 70,070,000 | 27.1% |
| Earnings per share | 0.04 | 0.03 | 26.7% |
