Furniture Brands cuts loss as sales decline 7.4% in fourth quarter
Larry Thomas -- Furniture Today, February 9, 2012
ST. LOUIS — Furniture Brands International slashed its fourth-quarter net loss to $9.5 million as sales fell 7.4% from a year earlier.
The parent company of Thomasville, Lane, Broyhill, Drexel Heritage, Henredon and several other brands said the results show it is continuing to improve manufacturing efficiencies, hold down costs and strengthen its infrastructure.
The quarterly loss, which equals 17 cents per share, compares with a loss of $44.7 million or 82 cents per share in the fourth quarter of 2010.
Sales in the most recent quarter were $255.5 million, down from $276.1 million in the 2010 fourth quarter.
For the full year, sales totaled $1.11 billion, down 4.5% from $1.16 billion in 2010.
Sales at its 48 company-owned Thomasville retail stores were $108.5 million, up less than 1% from $107.8 million in 2010. Same-store sales at the 44 locations owned for at least 15 months rose 6%.
"2011 has been a year defined by continued progress on the cost and efficiency fronts but importantly, it also was a year where we made key investments to strengthen our infrastructure and improve our competitiveness for the long term," said Ralph Scozzafava, chairman and CEO.
During a conference call with securities analysts, he said the company's top priority in 2012 is to drive profitable sales.
"We have taken revenue out of our system that just wasn't profitable," Scozzafava said. "This year, we will focus on bringing the right product at the right price to the right retailers."
He told analysts that new factories in Mexico and Indonesia will have a positive impact on earnings in the second half of 2012, and will save the company about $12 million annually beginning in 2014.
"We can hit price points on furniture from those plants we couldn't hit a year ago," he said.
Scozzafava said the company will generate positive free cash flow this year, but stopped short of saying it will turn a profit. The company offered no sales or earnings guidance for the year.
"We are a much leaner company today than at any time in our history," he said. "We continue to make progress on the path to profitability."
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