PEMBROKE PINES, Fla., Aug. 16 /PRNewswire-FirstCall/ -- Decorator Industries, Inc. , a leading supplier of interior furnishings for the hospitality, manufactured housing ("MH") and recreational vehicle ("RV") industries, today reported a net loss of $103,757 or $0.03 per diluted share for the second quarter of fiscal 2010 compared with a net loss of $366,181 or $0.12 per diluted share in the second quarter of 2009. The net loss for the first six months of fiscal 2010 was $447,278 or $0.14 per diluted share compared with a net loss of $1,657,110 or $0.56 cents per diluted share for the same period a year ago. The second quarter 2009 loss included a pre-tax charge of $150,000 related to the closing of certain facilities and the six months of 2009 included pre-tax charges of $900,000.
Net sales for the second quarter of fiscal 2010 were $4,699,027, down 17% from $5,677,395 for the same period a year ago. Net sales for the first six months of fiscal 2010 were $8,719,654 a decline of 19% from $10,783,033 in the first half of 2009.
Sales to our Hospitality customers decreased 35% to $2,108,000 in the second quarter of fiscal 2010 from $3,244,000 in the second quarter a year ago. For the first six months of 2010 Hospitality sales decreased by 39% to $3,772,000 compared with $6,197,000 in the first six months of 2009. The new hotel construction pipeline has seen significant declines for the last seven quarters substantially reducing the projected new hotel openings through 2011. The reduction in new construction should enhance the improvements the hospitality industry has seen this summer in existing hotel performance metrics which bodes well for hotel refurbishment projects going forward.
Sales to our MH customers decreased 1% to $1,361,000 in the second quarter of fiscal 2010, compared with last years' second quarter sales of $1,369,000. For the six month period of fiscal 2010 our MH sales decreased by 9% to $2,435,000 compared with $2,669,000 for the same period a year ago. The Manufactured Housing Institute reported that industry shipments increased 17% from last year's second quarter resulting in a year-to-date increase of 8%. It's difficult to draw a direct correlation between our sales and the wholesale shipments because of changes in product mix and pricing as well as varied performance in different geographical regions. Our sales have been marginally impacted by closing the Salisbury, NC facility in August 2009.
Sales to our RV customers increased 16% to $1,230,000 in the second quarter of fiscal 2010, compared with last years' second quarter sales of $1,064,000. For the six month period of fiscal 2010 our RV sales increased by 31% to $2,513,000 compared with $1,917,000 for the same period a year ago. The RV industry reported an 80% increase in total shipments from last year's second quarter, with towable shipments increasing by 75% and motor home shipments increasing by 144%. Total RV industry shipments for the six months of 2010 were up by 87%, with towable shipments increasing 83% and motor home shipments increasing 141%. Excluding the discontinued sewn goods sales from 2009's second quarter and year-to-date sales reveals our pleated shade sales to the RV industry in 2010 increased 58% in the second quarter and 75% year-to-date.
Mr. Johnson, President, stated:
"The operating loss decreased to $124,800 or 2.6% of net sales in the second quarter of fiscal 2010 from $599,697 or 10.6% of net sales in the second quarter of 2009. The 2009 operating loss included a one time charge of $247,714 related to the closing of a facility and loss on the sale of assets. The reduced operating losses on lower sales volumes were achieved by improving the profit margins through increased labor efficiencies and reduced overheads which were somewhat offset by higher material costs.
"Selling and administrative expenses decreased to $1,252,297 in the second quarter of 2010 from $1,830,651 for the second quarter of 2009. The net decrease of $330,640, excluding the one time charges of $247,714 in 2009, was largely the result of reduced compensation and benefits.
"During the second quarter of 2010 we completed the sale of our Douglas, GA building using the $208,360 in net proceeds to reduce our debt with Wachovia (a Wells Fargo Bank). We continue to market our remaining real estate in an effort to further reduce our loan balance with Wachovia.
"Our markets have shown varying degrees of recovery in recent months but it remains extremely challenging to anticipate if the recovery will continue and to what degree. Our customers continue to look for ways to reduce their costs which negatively impacts our sales volumes. We will continue to focus on increasing sales and reducing overheads in an effort to return to profitability.
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 QUARTERS ENDED: ------------------- July 3, July 4, 2010 2009 ------- -------- NET SALES $4,699,027 $5,677,395 COST OF PRODUCTS SOLD 3,571,530 4,446,441 --------- --------- GROSS PROFIT 1,127,497 1,230,954 SELLING AND ADMINISTRATIVE EXPENSES 1,252,297 1,830,651 --------- --------- OPERATING LOSS (124,800) (599,697) OTHER INCOME (EXPENSE) Interest, Investment and Other Income 5,827 8,303 Interest Expense (44,784) (32,787) ------- ------- LOSS BEFORE INCOME TAXES (163,757) (624,181) PROVISION FOR INCOME TAXES (60,000) (258,000) ------- -------- NET LOSS $(103,757) $(366,181) ========= ========= EARNINGS (LOSS) PER SHARE: BASIC $(0.03) $(0.12) ====== ====== DILUTED $(0.03) $(0.12) ====== ====== WEIGHTED-AVERAGE NUMBER OF SHARES OUTSTANDING BASIC 3,123,790 2,987,495 DILUTED 3,123,790 2,987,495 CONDENSED STATEMENT OF INCOME FOR TWENTY SIX WEEKS ENDED: --------------------- July 4, July 3, 2010 2009 ------------ -------- NET SALES $8,719,654 $10,783,033 COST OF PRODUCTS SOLD 6,820,025 8,833,284 --------- --------- GROSS PROFIT 1,899,629 1,949,749 SELLING AND ADMINISTRATIVE EXPENSES 2,531,466 4,319,641 --------- --------- OPERATING LOSS (631,837) (2,369,892) OTHER INCOME (EXPENSE) Interest, Investment and Other Income 15,075 11,934 Interest Expense (98,516) (69,152) ------- ------- LOSS BEFORE INCOME TAXES (715,278) (2,427,110) PROVISION FOR INCOME TAXES (268,000) (770,000) -------- -------- NET LOSS $(447,278) $(1,657,110) ========= =========== EARNINGS (LOSS) PER SHARE: BASIC $( 0.14) $( 0.56) ======= ======= DILUTED $( 0.14) $( 0.56) ======= ======= WEIGHTED-AVERAGE NUMBER OF SHARES OUTSTANDING BASIC 3,111,987 2,970,528 DILUTED 3,111,987 2,970,528 CONDENSED BALANCE SHEET July 3, January 2, 2010 2010 -------- ----------- CASH AND EQUIVALENTS $937,240 $156,171 ACCOUNTS RECEIVABLE 1,478,494 1,164,669 INVENTORIES 1,914,515 2,107,151 OTHER CURRENT ASSETS 438,387 1,581,047 ------- --------- TOTAL CURRENT ASSETS 4,768,636 5,009,038 NET PROPERTY AND EQUIPMENT 6,010,200 6,424,880 OTHER ASSETS 5,003,468 4,736,749 --------- --------- TOTAL ASSETS $15,782,304 $16,170,667 =========== =========== TOTAL CURRENT LIABILITIES $5,267,469 $5,201,633 LONG-TERM DEBT 420,000 490,000 STOCKHOLDERS' EQUITY 10,094,835 10,479,034 ---------- ---------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $15,782,304 $16,170,667 =========== ===========
Decorator Industries, Inc.
CONTACT: William Johnson, President/CEO, +1-954-436-8909
Web Site: http://www.decoratorindustries.com/
