Stanley trims loss to $4.9 million as sales decline 9.3%
CEO says third-quarter results reflect progress
Larry Thomas -- Furniture Today, November 4, 2010
Glenn Prillaman, president and CEO, said the results show that the company's restructuring, which was announced in May, is on track to return Stanley to profitability.
"We are pleased with the progress we have made to date, as evidenced by a smaller operating loss and less use of cash in the third quarter compared to the first and second quarters of this year," Prillaman said.
Sales for the three months ended Oct. 2 totaled $34.9 million, compared with $38.5 million for the three months ended Sept. 26, 2009.
The most recent quarter's loss, which equals 48 cents per share, compares with a net loss of $5.1 million or 49 cents per share in last year's third quarter.
Sales for the nine months ended Oct. 2 were $109.3 million, a drop of 9.3% from the same period in 2009.
The nine-month net loss, including a goodwill impairment charge of $9.1 million, totaled $35.5 million or $3.43 per share. For the same period last year, the net loss was $10.5 million or $1.01 per share.
A key element of the restructuring - the shutdown of its Stanleytown case goods plant and transfer of its adult furniture production to Asia - is proceeding as planned, Prillaman said, noting that production at the Virginia facility will end in December.
"We anticipate operating inefficiencies stemming from the wind-down of this plant and the disruption created by this move may reduce sales and increase our operating loss in the fourth quarter compared to the third quarter of 2010," he said. "However, our partner factories overseas are already making a significant portion of this product line, and we anticipate a smooth operational transition as we shift our remaining domestic production to these suppliers."
Stanley continues to produce the majority of its Young America youth furniture line domestically at its plant in Robbinsville, N.C.
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