Quaker 1Q net sales drop 29.6% to $32.6M
By Furniture Today Staff -- Furniture Today, April 23, 2007
Fall River, Mass. — Upholstery fabric supplier Quaker Fabric reported net sales of $32.6 million and a net loss of $5.1 million, for the three-month period ended March 31. That compares to net sales of $46.3 million and a net loss of $4.1 million for the same period of fiscal 2006.
Quaker's financial results for the first quarter of fiscal year 2007 include a pre-tax restructuring charges of $300,000. Excluding these charges, the net loss for the first fiscal quarter of 2007 was $4.8 million.
Domestic fabric sales for the quarter were down about 33% to $25.6 million, compared to $38.2 million in the same quarter of fiscal 2006. In addition, the company reported incoming orders for the quarter were off about 27% over the previous year's first quarter.
President and CEO Larry Liebenow called 2007 "a key transition year" for the company and said the primary emphasis will be on "increasing overall sales, striking the right balance between domestic production and global sourcing, achieving costs consistent with our sales, and generating adequate cash flows."
As part of the restructuring, the company's head count at the end of the first quarter of 2007 was 917, down from 1,462 in the first quarter of 2006.
Liebenow said the company is pleased by the performance of its import programs, outdoor fabrics and upper-end residential, as well as its move into the contract market.
The company expects to close on the sale of its headquarters building by the end of this month, Liebenow said. The company is also aggressively marketing three additional facilities, a parcel of land and about $2.5 million in idle machinery. The total value of all the assets for sale, including the headquarters building, is about $21.6 million.
| Quaker Fabric | |||
|---|---|---|---|
| Earnings per share are fully diluted, and all figures in parentheses are losses or declines. | |||
| Quarter ended 3/31 | 2007 | 2006 | Change |
| (a) Includes pre-tax restructuring charges of $299,000 in the 2007 quarter and $599,000 in the 2006 quarter. Also includes an $87,000 income tax charge in the 2007 quarter and a $2.2 million income tax benefit in the 2006 quarter. | |||
| Sales | $32,596,000 | $46,280,000 | (29.6%) |
| Operating income | (3,515,000) | (4,588,000) | |
| Net income(a) | (5,115,000) | (4,135,000) | |
| Earnings per share | (0.30) | (0.25) | |
