O'Sullivan 2Q sales drop 17.5%
By Furniture Today Staff -- Furniture Today, February 23, 2004
LAMAR, Mo. — LAMAR, Mo. — O'Sullivan Inds. Holdings, which owns and operates flat-pack specialist O'Sullivan Furniture, reported a sales decline of 17.5% to $65.2 million in its second quarter, with a net loss of $8.4 million.
For its first half ended Dec. 31, the ready-to-assemble furniture maker said sales dropped 9.3% to $136.7 million and the net loss came to $18.7 million.
Both losses were greater than in last year's respective periods.
Earnings before income taxes, depreciation and amortization at the highly leveraged company declined 41.8% to $6.6 million from $11.4 million in the prior year's quarter. For the first half, EBITDA dropped 53.6% to $10.5 million from $22.6 million. The EBITDA figures exclude preferred dividends.
O'Sullivan management attributed the declines to a weak economy, fewer retail customers and tough competition from imports, adding that performance was affected by lower production, which increased unit costs.
The company said little relief is in sight this fiscal year.
| O'Sullivan Inds. | |||
|---|---|---|---|
| All figures in parentheses are losses or declines. | |||
| Quarter ended 12/31 | 2003 | 2002 | Change |
| Sales | $65,234,000 | $79,111,000 | (17.5%) |
| Operating income | 2,992,000 | 8,109,000 | (63.1%) |
| Net income | (a)(8,399,000) | (b)(1,516,000) | — |
| 6 months ended 12/31 | 2003 | 2002 | Change |
| Sales | $136,698,000 | $150,668,000 | (9.3%) |
| Operating income | 6,824,000 | 16,023,000 | (57.4%) |
| Net income | (a)(18,697,000) | (b)(3,459,000) | — |
| (a) After dividends and accretion on preferred stock of $3 million in the 2003 quarter and $6 million in the 2003 six months; includes a pretax casualty loss of $250,000 in both periods. (b) After preferred dividends and accretion on preferred stock of $3.5 million in the 2002 quarter and $7 million in the 2002 six months. |
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