Stanley 2Q sales fall
By Larry Thomas -- Furniture Today, July 20, 2008
STANLEYTOWN, Va. — Case goods major Stanley Furniture said second-quarter sales were 12.7% below last year's second quarter amid continually weak consumer demand.
The manufacturer said its net loss for the quarter ended June 28 was $68,000 or 1 cent per share. That's an improvement from the loss of $2.4 million or 23 cents per share that Stanley recorded in the same quarter last year, when it took a one-time charge of 43 cents per share to terminate its defined benefit pension plan.
“Historically low levels of consumer confidence, housing activity and personal disposable income has led to an industry-wide weakness in consumer demand for residential furniture not seen since the early '80s,” said Jeff Scheffer, president and CEO.
He noted that the company has taken several steps recently to reduce costs — notably announcing that it will close its Lexington, N.C. factory — but said the industry sales slump is likely to continue for the rest of the year.
For the first half of 2008, sales slid 14.8% to $121.7 million. The company reported first-half net income of $980,000 or 9 cents per share. In the first half of last year, Stanley recorded a loss of $700,000 or 7 cents per share.
Stanley said its operating income declined to $3.4 million for the year to date, including about $300,000 in restructuring charges. That was down from $6.6 million in the 2007 first half, excluding the pension termination charge, which also was $6.6 million.
Scheffer said the company is now projecting sales of $230 million to $237 million for the full year, down from earlier projections of $233 million to $243 million. Last year's sales totaled $282.8 million.
Stanley is projecting a net loss for the year of 25 cents to 46 cents per share, including restructuring charges. Earlier this year, the projection was for earnings of 27 cents to 38 cents per share, not including restructuring charges.
Last year, the company had earnings of 55 cents per share, which included several one-time charges. In addition, last year's figure included income of 66 cents per share from antidumping duties collected from producers of Chinese-made wood bedroom furniture.
| Stanley Furniture | |||
|---|---|---|---|
| Earnings per share are fully diluted, and all figures in parentheses are losses or declines. | |||
| (a) Includes pretax pension plan termination charge of $6.6 million in the 2007 quarter and six months. |
|||
| Quarter ended 6/28 | 2008 | 2007 | Change |
| Sales | $59,148,000 | $67,722,000 | (12.7%) |
| Operating income | 979,000 | 3,547,000 | (72.4%) |
| Net income (a) | (68,000) | (2,376,000) | — |
| Earnings per share | (0.01) | (0.23) | — |
| 6 months ended 6/28 | 2008 | 2007 | Change |
| Sales | $121,682,000 | $142,830,000 | (14.8%) |
| Operating income | 3,029,000 | 6,626,000 | (54.3%) |
| Net income (a) | 980,000 | (700,000) | — |
| Earnings per share | 0.09 | (0.07) | — |
