Natuzzi posts smaller loss as sales rise 3.9%

American market remains soft

Larry Thomas -- Furniture Today, September 4, 2008

SANTERAMO IN COLLE, Italy - Upholstery major Natuzzi said its second-quarter sales rose 3.9%, but the company recorded a net loss of 2.4 million euros due largely to continued weakness in the U.S. market.

The company said worldwide sales for the quarter ended June 30 totaled 168.8 million euros, up from 162.4 million euros in the same quarter last year.

Unit sales in the most recent quarter were 2.7% ahead of last year's second quarter.

The sales growth came in Europe, where sales were 4.4% ahead of the same quarter last year, and in markets outside North America and Europe, where sales rose 28.3%

Sales in the Americas, which includes the U.S. market, were down 7.4% to 45.3 million euros.

"The sales increase achieves versus the same period of last year ... is a great accomplishment considering the current market conditions," said Aldo Uva, CEO. "However, we cannot be happy with the overall result."

The most recent quarter's net loss was some 42% smaller than the loss recorded in last year's second quarter, when the company lost 4.2 million euros.

"We still have a lot of work to do to make our group lean and to increase dramatically our level of service to the markets while drastically reducing costs," Uva said.

For the six months ended June 30, worldwide sales rose 8% to 341.6 million euros. Sales in the Americas slipped 0.5% to 94.9 million euros, while sales to Europe rose 8.5% to 179.7 million euros.

The six-month net loss came to 25.9 million euros. In the first six months of last year, the company had a net loss of 9 million euros.