Stanley's sales rise 2.9% in 1Q
By Furniture Today Staff -- Furniture Today, April 21, 2003
Stanleytown, Va. — Case goods resource Stanley Furniture continues to rebound from a poor 2001, with sales up 2.9% in this year's first quarter and net income jumping 85.6%, mainly because of a large writeoff last year.
Sales in 2001 dropped nearly $50 million to $234.3 million, when Stanley's largest customer, HomeLife, declared bankruptcy. Sales grew 2.2% in 2002 to $239.5 million, and the latest increase marks the fourth consecutive quarter that sales have risen.
President and Chief Executive Officer Jeff Scheffer expects sales will grow in the current quarter.
Sales for the first quarter were $61.3 million, compared to $59.6 million in 2002's first quarter. Net income grew to $3.5 million from $1.87 million a year ago, when profits were hurt by a nearly $1.8 million writeoff of money owed by HomeLife.
Scheffer said the two case goods lines and the youth line introduced at the April market were very well received by retailers. That indicates that when the economy picks up, Stanley will be poised for growth, said Albert Prillaman, chairman.
"Eventually the consumer is going to come back into the market," said Prillaman. "We're just having a hard time figuring out what's going to start it."
Until the economy rebounds, Stanley expects sales growth to be modest. For 2003, Doug Payne, executive vice president of finance and administration, estimated sales will be in the range of $242 million to $252 million, an increase of 1% to 5% over 2002.
Imports are playing a bigger role at Stanley, growing from less than 10% of the line in 2002 to about 20% this year, Scheffer said.
"We continue to implement our strategy of blending efficient domestic manufacturing capabilities ... with intelligent outsourcing," he said. "This allows us to offer higher value and well-styled product without sacrificing high quality and quick delivery."
The strategy now focuses on "styling up without pricing up," Prillaman said, noting dining sales had been weak but have begun to turn around thanks to better-priced imported items in the line.
| Stanley Furniture | |||
|---|---|---|---|
| Earnings per share are fully diluted, and all figures in parentheses are losses or declines. | |||
| Quarter ended 3/29 | 2003 | 2002 | Change |
| (a) Includes a $2.9 million pretax charge for restructuring and related charges for the realignment of manufacturing facilities. (b) Based on average shares outstanding of 6.7 million in the 2003 quarter and 6.9 million in the 2002 quarter. | |||
| Sales | $61,298,000 | $59,574,000 | 2.9% |
| Operating income | 6,109,000 | 6,551,000 | (6.7%) |
| Net income | 3,466,000 | (a)1,867,000 | 85.6% |
| Earnings per share (b) | 0.52 | 0.27 | 92.6% |
