Furniture Brands' Loss Widens in Third Quarter
ST. LOUIS-Declining sales and one-time charges for cost-reduction initiatives brought Furniture Brands International to a net loss of $24.5 million in its third quarter, compared to a net loss of $2.1 million in the third quarter of last year.
Net sales for the quarter, which ended on Sept. 30, fell 5.1 percent to $258 million. Gross margin was off 248 basis points to 22.3 percent. Selling, general and administrative expenses rose 6 percent on a dollar basis and 306 basis points as a percentage of sales, to 29.1 percent. Those cost-reduction actions resulted in a charge of $16.5 million against earnings.
Ralph Scozzafava, Furniture Brands' chairman and CEO, cited the "macro headwinds" that have affected the economy and, in particular, the furniture industry. "Our focus has been, and continues to be, on controlling our controllables," Scozzafava said. "We have to be proactive in further strengthening our competitive position and improving our cost structure."