From Home Furnishing Business
Young America Closure Impacts Stanley 1Q
In the first quarter last year, the company posted a net loss of $2.1 million.
The loss includes restructuring costs of $1.2 million related to the company's move to shutter its Young America line of youth furniture.
Net sales for the quarter dropped 16 percent to $21.9 million compared to first quarter sales of $26 million reported last year.
“The decision we announced on April 1, 2014 to no longer pursue our long-term goals associated with the Young America brand was painful for both us and our customers, representatives and associates who have dedicated themselves to the brand over the past several years," said Glenn Prillaman, president and CEO. "We made great strides towards building a business model that would successfully compete in a quickly changing consumer marketplace but concluded we could not ultimately achieve profitability within an acceptable amount of time."
During the second quarter, Stanley expects additional restructuring charges as it ceases production, announces termination dates for impacted employees and other impairments. The company said it will likely have an additional $500,000 to $900,000 restructuring costs in the third quarter from severance and other termination costs.
Stanley's property, plant and equipment used to produce Young America is all for sale and has an estimated value of $18 million.