Shermag Reports 4Q, Year-End Results

June 15, 2006  by in UnCategorized   

By Home Furnishings Business in Case Goods on June 2006 Canadian manufacturer Shermag reported a $22.7 million (Canadian) loss on $47.8 million in sales for its fourth fiscal quarter of 2005-2006, which ended March 31. For the year, the company lost $30.6 million on $198.8 million in sales.

Sales in the fourth quarter were down 25.1 percent compared to the prior-year period, while sales for the year were off 17.9 percent compared with 2004-2005 results.

Fourth-quarter results included unusual costs of $19.5 million associated with employee severances and asset impairment, as well as costs associated with the acquisition of producer Jaymar.

“Operating results were affected by further weakening of the U.S. dollar versus the Canadian dollar,” said Jeff Casselman, president and chief executive officer. “In addition, the consolidation and transformation of the companies domestic facilities continue to be difficult, and is longer and more expensive than expected.”

Shermag is making progress on several fronts, he said. Those include more aggressive Asian outsourcing, a new 350,000-square-foot finished-goods warehouse, moving glider-rocker production to Asia, and an agreement to produce a licensed furniture line with Metropolitan Home.