Foamex Sales Deflate

November 12, 2007  by in UnCategorized   

By Home Furnishings Business in Bedding on November 2007 Hit by a sharp drop in sales of foam and carpet cushion, Foamex International, Linwood, Pa., reported that sales in its third quarter decreased 7 percent to $291 million. Net income of $0.1 million during the period was down from $7.4 million during the same period last year.

Net income was hurt by restructuring charges of $3.7 million and a $3 million charge due to credit concerns over a significant customer the company did not name. It also incurred a charge of $1.1 million for bankruptcy related litigation costs. The charges were offset by a $1.4 million gain from the sale of the company’s interest in a joint venture in Asia.

President and CEO Jack Johnson said the company reduced net debt by approximately $46 million during the quarter due, in part, to the sale of Foamex Asia and its stand-alone carpet cushion facilities.

“Debt reduction continues to be a primary focus for Foamex,” he said. “We continue to work aggressively to reduce costs and improve operation efficiencies.”

Sales of foam products decreased 22 percent to $107 million and carpet cushion sales decreased 51 percent to $21.5 million. Sales in the company’s automotive products segment increased 33 percent of $130.2 million.