Quaker Fabric posts stronger margins in 4th qtr.
By Furniture Today Staff -- Furniture Today, February 23, 2004
FALL RIVER, Mass. — FALL RIVER, Mass. — Despite lower revenues and a challenging economy, Quaker Fabric said it achieved stronger strong gross margins in the fourth quarter as well as the fiscal year.
A major supplier of fabric to the furniture industry, Quaker said its sales of $80.5 million in the 13-week fourth quarter of 2003 were down 2.5% from the 14-week fourth quarter of 2002. Net income more than doubled, to $3.3 million from $1.2 a year earlier.
A boost to the latest quarterly earnings was a one-time pre-tax gain of $1.4 million from the favorable resolution of a foreign tariff refund claim.
Sales of $325.3 million for the 52-week fiscal year ended Jan. 3 were down 11% from the previous 53-week year, and net income of $7.9 million was down 31.3%.
Larry Liebenow, president and CEO, said Quaker's performance was solid in light of the sluggish economy in 2003. He listed improved efficiency and a commitment to technology as contributing factors to the "strength of our gross margin performance for the fourth quarter and the year, despite lower revenues."
He also noted that during the year the company cut inventory, paid its first-ever stock dividends, improved its cash flows and paid down debt, ending the year with debt to total capitalization of 18.9%, versus 28.7% at the end of 2002.
Quaker's board last week increased the dividend by 20%, approving a payment of 3 cents per common share on March 19.
| Quaker Fabric | |||
|---|---|---|---|
| Earnings per share are fully diluted, and all figures in parentheses are losses or declines. | |||
| Quarter ended 1/3 (a) | 2004 | 2003 | Change |
| Sales | $80,461,000 | $82,492,000 | (2.5%) |
| Operating income | 4,636,000 | 3,084,000 | 50.3% |
| Net income | (b)3,284,000 | 1,155,000 | 184.3% |
| Earnings per share (c) | 0.19 | 0.07 | 171.4% |
| Year ended 1/3 (a) | 2004 | 2003 | Change |
| Sales | $325,337,000 | $365,445,000 | (11.0%) |
| Operating income | 14,801,000 | 23,067,000 | (35.8%) |
| Net income | (b)7,939,000 | 11,556,000 | (31.3%) |
| Earnings per share (c) | 0.47 | 0.69 | (31.9%) |
| (a) The 2004 quarter is 13 weeks; the 2003 quarter is 14 weeks and the 2004 year is 52 weeks; the 2003 year is 53 weeks. (b) Includes a $1.4 million pretax gain on the collection of a foreign tariff refund in both periods. (c) Based on average shares outstanding of 17.1 million in the 2004 quarter, 16.7 million in the 2003 quarter, 17 million in the 2004 year and 16.8 million in the 2003 year. | |||
