Furniture Brands Loss Balloons in Q4
ST. LOUIS-Furniture Brands International's bottom line turned significantly redder in its fiscal fourth quarter, with the company ending its fiscal year with a $22.9 million net loss for the quarter, compared to the net loss of $9.5 million in the same period of last year.
For the fiscal year ending on Dec. 31, Furniture Brands posted a net loss of $47.3 million, on top of its fiscal 2011 net loss of $43.8 million. The fourth-quarter loss grew in spite of a net sales gain of 3.3 percent to $264 million. For the fiscal year, net sales fell 3.2 percent to $1.1 billion.
Declining gross margin victimized Furniture Brands in the quarter, dropping 232 basis points to 20.7 percent. In addition, the company's interest expense jumped 131.4 percent. Selling, general and administrative expenses actually declined 1.2 percent in dollars and 122 basis points as a percentage of sales, to 26.9 percent.
Ralph Scozzafava, Furniture Brands' chairman and CEO, said the fourth-quarter numbers show that "much work remains to be done in order to make progress driving profitable sales growth." Scozzafava added that the ramping up of production in the company's facilities in Mexico and Indonesia, plus the beginning of the company's casegoods-mixing program, should lead to cost reductions going forward.
He added that 2013 will see more efforts toward increasing sales profitably. "We will also remain focused on manufacturing efficiencies as well as on reducing costs and improving working capital," he said.