WestPoint Narrows Third-Quarter Loss
NEW YORK-WestPoint International posted a net loss of $9 million in its fiscal third quarter, compared to the $14 million in red ink reported in the third quarter of last year, according to a U.S. Securities and Exchange Commission filing by its parent company, Icahn Enterprises.
Although the bottom line showed some improvement in the quarter, which ended on Sept. 30, the top line continued to suffer. Net sales dropped 32 percent to $79 million, feeling the combined impact of the weak economy and housing market, along with WestPoint's exit from unprofitable programs. The falloff was partially offset by price increases instituted in both the first and second quarters of this year.
Rising commodity and fuel costs resulted in a 137 basis-point decrease in gross margin, which finished the quarter at 3.8 percent. Selling, general and administrative expenses decreased 26 percent in dollars but added on 134 basis points as a percentage of sales, to 17.7 percent.
The Icahn filing said, "While current economic indicators project continued volatility with commodity and fuel costs, we cannot predict whether, or how long, current market conditions will continue to persist."