PEMBROKE PINES, Fla., Nov. 17 /PRNewswire-FirstCall/ -- Decorator Industries, Inc. today announced its operating results for the third quarter ended, October 03, 2009.
Decorator Industries, Inc. (AMEX-DII), a leading supplier of interior furnishings for the hospitality, manufactured housing ("MH") and recreational vehicle ("RV") industries, today reported a net loss of $468,527 or $0.16 per diluted share for the third quarter of fiscal 2009 compared with a net loss of $407,290 or $0.14 per diluted share in the third quarter of 2008. The net loss for the first nine months of fiscal 2009 was $2.1 million or $0.71 per diluted share compared with a loss of $1.9 million or $0.66 cents per diluted share for the same period a year ago. The fiscal 2009 loss includes a pre-tax charge of $900,000 or $0.30 per diluted share related to the scheduled consolidation of certain facilities and the impairment of assets compared to a pre-tax charge of $1,430,000 or $0.49 per diluted share for fiscal 2008.
Net sales for the third quarter of fiscal 2009 were $4.5 million, down 52% from $9.3 million for the same period a year ago. Net sales for the first nine months of fiscal 2009 were $15.3 million a decline of 53% from $32.4 million in the first nine months of 2008.
Sales to our Hospitality customers decreased 56% to $2.2 million in the third quarter of 2009 from $4.9 million in the third quarter a year ago. For the first nine months of 2009, Hospitality sales decreased by 39% to $8.4 million compared with $13.7 million in the first nine months of 2008.
Sales to MH customers decreased 38% to $1.3 million in the third quarter of fiscal 2009, compared with last year's third quarter sales of $2.1 million. For the nine month period of fiscal 2009, MH sales decreased by 44%, to $4.0 million compared with $7.1 million for the same period a year ago. The Manufactured Housing Institute reported that industry shipments decreased about 37% from last year's third quarter, resulting in a year-to-date decrease of about 42%. MH industry shipments continue to improve and increased by almost 3% in the third quarter of 2009 versus the second quarter of 2008.
Sales to RV customers decreased 56% to $1.0 million in the third quarter of fiscal 2009, compared with last year's sales for the same period of $2.3 million. For the first nine months of fiscal 2009, RV sales decreased 75% to $2.9 million compared with $11.7 million for the same period a year ago. The RV industry reported only a 1% decline in total shipments from last year's third quarter, with towable shipments increasing by 2% and motor home shipments decreasing by 34%. Total RV industry shipments for the first nine months of 2009 were down by 43%, with towable shipments decreasing 40% and motor home shipments decreasing 65%. RV industry shipments ignored the normal seasonal decline and increased by 15% in the third quarter of 2009 versus the second quarter of 2009.
Mr. Johnson, President, stated:
"We reduced the operating loss to $512,606 for the third quarter of 2009 compared to $635,466 in last year's third quarter. The operating loss was caused by the 52% drop in sales. The decline in sales offset the almost 5% improvement in the gross profit margin and $850,000 reduction in overhead costs compared to the third quarter of 2008. We consolidated our Salisbury, NC facility into Haleyville, AL in a continuing effort to reduce operating costs and better utilize the remaining facilities.
"We reduced selling and administrative expenses by over $700,000 in the third quarter of 2009 to $1.5 million versus $2.2 million in last year's third quarter. Most of the cost reduction came from reductions in staffing, incentive compensation, benefits and reduced commissions. The current quarter included a $100,000 charge related to the modification of the loan agreement with Wachovia Bank, a Wells Fargo Company.
"We improved our cash flow in the third quarter through reductions in receivables and inventory allowing us to pay down the borrowings by almost $425,000. In September 2009 the Company modified its loan agreement with Wachovia Bank, a Wells Fargo Company, extending the maturity date of the loan agreement to December 31, 2010. The extension provides us the time needed to allow our markets to continue to recover and to continue to improve the Company's financial condition.
"The RV industry tends to be a leading indicator of economic recoveries. The recent improvement in the RV market provides some encouragement that we are indeed beginning to enter the recovery phase. The pace of the recovery will be driven by improvements in unemployment, consumer spending, the residential housing market, and availability of credit. We expect the recovery to be a long, slow process and to continue to present more challenges ahead. We must now focus more of our attention on innovative ways to increase sales in an effort to outperform the markets. We will continue to benefit from past cost reduction efforts and consolidations of facilities, but growing sales is the path to profitability and success in these challenging times."
STATEMENTS CONTAINED IN THIS RELEASE THAT ARE NOT HISTORICAL FACTS ARE FORWARD-LOOKING STATEMENTS THAT COULD DIFFER MATERIALLY FROM ACTUAL RESULTS. PRIMARY FACTORS THAT COULD CAUSE ACTUAL RESULTS TO MATERIALLY DIFFER FROM THOSE IN THE FORWARD-LOOKING STATEMENTS ARE THE LEVEL OF DEMAND FOR RECREATIONAL VEHICLES, MANUFACTURED HOUSING AND HOTEL/MOTEL ACCOMMODATIONS, THE GENERAL ECONOMIC CONDITIONS, THE COMPANY'S ABILITY TO RETAIN OR REPLACE ITS LINE-OF-CREDIT, INTEREST RATE FLUCTUATIONS, THE AVAILABILITY OF CONSUMER CREDIT, FUEL PRICES, COMPETITIVE PRODUCTS AND PRICING PRESSURES WITHIN THE COMPANY'S MARKETS, THE COMPANY'S ABILITY TO CONTAIN ITS MANUFACTURING COSTS AND EXPENSES, AND OTHER FACTORS.
DECORATOR INDUSTRIES, INC., FOUNDED IN 1953, DESIGNS MANUFACTURES AND SELLS INTERIOR FURNISHING PRODUCTS, PRINCIPALLY DRAPERIES, CURTAINS, SHADES, BLINDS, VALANCE BOARDS, BEDSPREADS, COMFORTERS, PILLOWS, CUSHIONS AND TRAILER TENTS. DECORATOR IS A LEADING SUPPLIER TO THE MANUFACTURED HOUSING AND RECREATIONAL VEHICLE MARKETS AND IS A GROWING SUPPLIER TO THE LODGING INDUSTRY.
(DIIG) THE UNAUDITED FIGURES ARE AS FOLLOWS CONDENSED STATEMENT OF INCOME FOR THIRTY NINE FOR QUARTERS ENDED: WEEKS ENDED: --------------------- ----------------------- Oct. 3, Sept. 27, Oct. 3, Sept. 27, 2009 2008 2009 2008 ---------- ---------- ---------- ---------- NET SALES $4,493,365 $9,334,653 $15,276,398 $32,401,620 COST OF PRODUCTS SOLD 3,531,984 7,785,917 12,365,268 27,159,748 ---------- ---------- ---------- ---------- GROSS PROFIT 961,381 1,548,736 2,911,130 5,241,872 SELLING AND ADMINISTRATIVE EXPENSES 1,473,987 2,184,202 5,793,628 8,344,805 ---------- ---------- ---------- ---------- OPERATING INCOME (LOSS) (512,606) (635,466) (2,882,498) (3,102,933) OTHER INCOME (EXPENSE) Interest, Investment and Other Income 7,702 12,504 19,636 47,114 Interest Expense (34,623) (36,328) (103,775) (99,518) ---------- ---------- ---------- ---------- LOSS BEFORE INCOME TAX (539,527) (659,290) (2,966,637) (3,155,337) PROVISION FOR INCOME TAXES (71,000) (252,000) (841,000) (1,212,000) ---------- ---------- ---------- ---------- NET LOSS $(468,527) $(407,290) $(2,125,637) $(1,943,337) ========== ========== ========== ========== EARNINGS (LOSS) PER SHARE: BASIC $(0.16) $(0.14) $(0.71) $(0.66) DILUTED $(0.16) $(0.14) $(0.71) $(0.66) WEIGHTED-AVERAGE NUMBER OF SHARES OUTSTANDING BASIC 3,022,493 2,933,683 2,987,849 2,932,846 DILUTED 3,022,493 2,933,683 2,987,849 2,932,846 CONDENSED BALANCE SHEET Oct. 3, Jan. 3, 2009 2009 ---------- ---------- CASH AND EQUIVALENTS $112,010 $16,499 ACCOUNTS RECEIVABLE 2,104,868 2,214,256 INVENTORIES 2,035,993 3,783,581 OTHER CURRENT ASSETS 505,836 524,879 ---------- ---------- TOTAL CURRENT ASSETS 4,758,707 6,539,215 NET PROPERTY AND EQUIPMENT 6,531,036 8,570,067 OTHER ASSETS 6,066,315 5,037,527 ---------- ---------- TOTAL ASSETS $17,356,058 $20,146,809 ========== ========== TOTAL CURRENT LIABILITIES $5,476,614 $6,132,116 LONG-TERM DEBT 525,000 615,000 STOCKHOLDERS' EQUITY 11,354,444 13,399,693 ---------- ---------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $17,356,058 $20,146,809 ========== ==========
Decorator Industries, Inc.
CONTACT: William Johnson, President/CEO, Decorator Industries, Inc.,
+1-954-436-8909
Web Site: http://www.decoratorindustries.com/
