The quarter drove old Dixie down
Thomas Russell -- Furniture Today, February 23, 2004
Weighed down by one-time charges tied to the pay-down of debt and the sale of two businesses, The Dixie Group, a high-end carpet and rug producer, recorded a fourth-quarter loss of $16.6 million, compared with a year-ago deficit of $1.4 million.
Acting as a drag on the bottom line was a $13.4 million after-tax charge stemming from the early retirement of debt and the write-down of assets. Also contributing to the company's difficulties was a $2.1 million after-tax loss from discontinued operations; and a $2.8 million after-tax loss on the sale of discontinued operations.
During the first quarter of 2003, Dixie sold its Ringgold, Ga.-based spun carpet yarn facility to Shaw Industries Group Inc., and in the third quarter sold off its North Georgia operations.
Even after the various asset sales, overall sales shot up by 19.5 percent during the closing quarter, to $64.6 million from $54.1 million last year. "All of our carpet brands reported strong sales gains in 2003," said Daniel K. Frierson, chairman and CEO. "Those sales trends have continued in the first quarter of 2004," propelled by sales of Fabrica and Masland brand products.
"Our business is now concentrated in the upper end of the carpet market, where innovating styling, design, color and product differentiation are demanded and rewarded," said Frierson. "Our newest line of residential carpeting, the Dixie Home collection, continues to gain in momentum with sales in the fourth quarter of 2003 running at an annualized rate of approximately $25 million."
The Dixie Group Inc.
|Qtr. 12/27 (x000)||2003||2002||% chg|
a-Fourth-quarter results include one-time pre-tax charges of $21.1 million, $13.4 million on an after-tax basis, stemming from the early retirement of debt and the write-down of assets impaired as a result of the sale of discontinued operations; $82,000 in miscellaneous, compared with $419,000 in miscellaneous income last year; a $6.8 million income-tax benefit, compared with a prior-year tax payment of $1.1 million; a $2.1 million loss on discontinued operations vs. $2 million last year; and a $2.8 million loss on the sale of discontinued operations.
b-12-month results include the $21.1 million in pre-tax charges stemming from the early retirement of debt and asset impairment; $760,000 in miscellaneous income vs. $1.1 million a year ago; a $5.1 million income-tax benefit, compared with a year-ago tax payment of $5.3 million; a $5.1 million loss from discontinued operations vs. $3.2 million in 2002; and a $2.8 million loss on the sale of discontinued operations vs. $3.7 million last year.
|Oper. income (EBIT)||4,964||6,165||-19.5|
|Per share (diluted)||(1.40)||(0.12)||-—|
|Average gross margin||33.6%||35.4%||—|
|12 months||2003||2002||% chg|
|Oper. income (EBIT)||14,123||20,686||-31.7|
|Per share (diluted)||(1.44)||0.39)||-—|
|Average gross margin||34.1%||34.6%||—|
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