GONZALES, La.–Crown Crafts posted a net loss of $8.2 million in its fiscal third quarter, compared to net income of $1.2 million in the third quarter of its last fiscal year.
The loss included a non-cash, pre-tax charge of $9 million for an estimate of “probable impairment to good will,” according to a company statement. Without that charge, Crown Crafts would have realized net income of $822,000 for the quarter. The charge came about because of a decline in the company’s market capitalization, Crown Crafts said. Sales for the third quarter rose 5 percent to $19.3 million.
The company also said it was able to reduce marketing and administrative expenses during the quarter. However, it reported a loss from operations of $7.4 million, resulting from its acquisition of the Springs Global baby-products line in last year’s third quarter, the costs of establishing an office in China and increased product costs from Asia.
Crown Crafts also said it expects total net revenues for fiscal year 2009, which ends on March 29, to be from $84 million to $87 million. If that forecast is achieved, it would represent an increase of from 12 percent to 16 percent over fiscal 2008 net revenues.