Natuzzi 1Q sales rise 21.9% in dollars
By Furniture Today Staff -- Furniture Today, May 31, 2004
SANTERAMO IN COLLE, Italy — SANTERAMO IN COLLE, Italy — Upholstery giant Natuzzi said sales in the first quarter were up 4.5% in euros to 191.8 million. In U.S. dollars, sales were $240 million, up 21.9% over last year's first period.
The average exchange rate was just over $1.25 to one euro for the 2004 quarter and about $1.07 per euro for the 2003 quarter, resulting in a conversion rate in 2004 more than 14% lower than first quarter 2003.
In dollars, Natuzzi net income in the quarter fell 25.8% to $11.8 million from $15.9 million a year ago. That translates into 9.4 million euros, with a 36.5% decline in that currency.
Pasquale Natuzzi, chairman and CEO, said, "Profitability was eroded by the appreciation of the euro against the U.S. dollar and the investments made in marketing to support the strengthening of the Natuzzi brand. However, we were in line with the outlook of a net profit margin in the region of 5% for 2004."
In the quarter, upholstery sales in the Americas increased by a narrow 0.4% to 79.5 million euros, or $99.5 million. In Europe, upholstery sales grew by 4.7% to 80.3 million euros or $100.5 million. The company attributed the increase to the higher penetration of its lower-priced lItalsofa upholstery line and the inclusion in consolidated revenues of Kingdom of Leather, the British furniture chain Natuzzi bought in May 2003.
Sales to Divani & Divani by Natuzzi and to Natuzzi stores were up 9.4% to 27.8 million euros, or $34.8 million.
First-quarter sales of Natuzzi-branded upholstery were off 2.4% to 131.6 million euros or $164.7 million, with Italsofa upholstery up 27.2% to 37.9 million euros or $47.4 million.
| Natuzzi(a) | |||
|---|---|---|---|
| Earnings per share are fully diluted, and all figures in parentheses are losses or declines. | |||
| Quarter ended 3/31 | 2004 | 2003 | Change |
| Sales | 191,800,000 | 183,500,000 | 4.5% |
| Operating income | 13,800,000 | 12,900,000 | 7.0% |
| Net income | 9,400,000 | 14,800,000 | (36.5%) |
| Earnings per share (b) | $0.21 | $0.29 | (27.6%) |
| (a) In European euros, except for earnings per share which are in U.S. dollars. (b) Based on average shares outstanding of 54.7 million in both periods. Converted at the rate of 1 euro = U.S. $1.2513 for the 2004 quarter and 1 euro = U.S. $1.0732 for the 2003 quarter. | |||
