WestPoint Loss Grows in Fourth Quarter
NEW YORK-WestPoint Home's fourth-quarter net loss rose from $20 million last year to $34 million this year, according to a 10-K filing with the U.S. Securities and Exchange Commission by Icahn Enterprises, the company's owner.
For fiscal year 2011 as a whole, WestPoint's net loss was $68 million, compared to $63 million from fiscal year 2010. Net sales for the quarter, which ended on Dec. 31, totaled $63 million, down 49 percent from the prior year. For the year, net sales were $322 million, a decrease of 25 percent from the prior year.
The 10-K filing attributed the company's weak performance to "the continued weak economy and housing market and the impact of exiting certain unprofitable programs."
In the quarter, gross margin came in at -1.6 percent, compared to 4.1 percent in last year's fourth quarter. WestPoint "has been negatively impacted by higher raw material and transportation costs," the 10-K said. Selling, general and administrative expenses for the quarter dropped 25 percent in dollars, but rose 914 basis points as a percentage of sales to 25.4 percent.
WestPoint "will continue to realign its manufacturing operations and streamline its merchandising, sales and customer-service divisions to improve its cost structure and better serve its customers," the filing said. "Given the uncertainty and volatility in the macroeconomic conditions, we cannot predict when, or if, (the company's) financial performance will improve."