Furniture Brands Net Loss Rises in Second Quarter
ST. LOUIS-Declining sales and margins produced additional red ink to Furniture Brands International's second quarter.
The company's net loss in the quarter, which ended on June 30, was $6.8 million, compared to a net loss of $6.6 million in the second quarter of 2011. Net sales fell 10.4 percent to $265.5 million, including a fall of 7.4 percent in same-store sales at the 44 Thomasville stores Furniture Brands has owned for more than 15 months. Gross margin was off 68 percentage points to 24.1 percent--the result of additional clearance of older inventory and product that has been replaced, a drop in retail margin and reduced plant usage.
Selling, general and administrative expenses were cut by 11.9 percent in dollars and 46 basis points as a percentage of sales in the quarter, to 26.3 percent. Ralph Scozzafava, Furniture Brands' chairman and CEO, said the company is progressing with its ongoing efforts to slim down costs and increase efficiencies.
The company is also "focused on driving sales through new product offerings that are updated, relevant and offer value to the customer," Scozzafava said. "We are seeking broader acceptance of this newer product, which has contributed to our increased order backlog at the end of the quarter."