Jennifer Convertibles’ loss widens in latest quarter
By Larry Thomas -- Furniture Today, December 21, 2009
WOODBURY, N.Y. — Retailer Jennifer Convertibles reported a wider fourth-quarter loss, as the struggling sofa-sleeper specialist incurred several one-time charges.
The company said it lost $5.26 million or 74 cents per share in the quarter ended Aug. 29 — the fourth quarter of its fiscal year. That compares with a net loss of $867,000 or 12 cents per share in the same quarter last year.
Sales from continuing operations fell 25.6% to $22.8 million.
The retailer said the fourth fiscal quarter included a $1.17 million writedown of the value of goodwill, a reserve of $947,000 for payments not received from its largest licensee, and a reserve of $1.3 million for a pending class action lawsuit alleging violations of California labor law.
The one-time charges also widened the loss for the fiscal year that ended Aug. 29 to $11 million or $1.55 per share. That compares with a net loss of $3.33 million or 47 cents per share in the previous fiscal year.
Sales for the fiscal year were $94.2 million, a drop of 21.6% from $120.1 million the previous year.
“Fiscal 2009 was a challenging year for the company as the difficulties in the economy impacted the home furniture industry particularly hard,” said Harley Greenfield, CEO.
However, Greenfield said he was pleased with the results of the four Ashley Furniture HomeStores owed by the company. The two locations that were open at the end of the fiscal year generated $12.8 million in sales, or more than 13% of Jennifer Convertibles revenues.
Since the end of the fiscal year Jennifer has opened two more Ashley stores, and it plans one additional unit in January, he said.
“Recently, we have seen an increase in revenues in our existing Ashley locations, and our new stores … are performing as projected,” said Greenfield. “We are also beginning to see some stabilization in our Jennifer stores. Capitalizing on our new line of extreme value merchandise, we expect to see improvement in our Jennifer division as well in 2010.”
The company has 148 Jennifer Convertibles stores and 14 Jennifer Leather stores. Twenty-one of the Jennifer units are licensed stores.
Jennifer Convertibles
Earnings per share are fully diluted, and all figures in parentheses are losses or declines.
| Quarter ended 8/29 | 2009 | 2008 | Change |
| (a) Includes revenues from service contracts of $1.2 million in the 2009 quarter, $1.8 million in the 2008 quarter, $5.3 million in the 2009 year and $7.1 million in the 2008 year. (a) Includes charges in the 2009 quarter and year of $1.2 million for impairment of goodwill, a $1.3 million provision for loss related to litigation, and a $947,000 provision for loss on amounts due from related company. Also includes losses from discontinued operations of $1,000 in the 2009 quarter, $90,000 in the 2008 quarter, $243,000 in the 2009 year and $335,000 in the 2008 year. |
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| Revenues (a) | $22,818,000 | $30,670,000 | (25.6%) |
| Operating income | (1,634,000) | (591,000) | — |
| Net income (a) | (5,263,000) | (867,000) | — |
| Earnings per share | (0.74) | (0.12) | — |
| Year ended 8/29 | 2009 | 2008 | Change |
| Revenues (a) | $94,177,000 | $120,131,000 | (21.6%) |
| Operating income | (6,261,000) | (2,484,000) | — |
| Net income (a) | (11,008,000) | (3,329,000) | — |
| Earnings per share | (1.55) | (0.47) | — |
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Jennifer Convertibles posts wider loss in quarter
Dec 15, 2009
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