From Home Furnishing Business
Bassett 1Q Sales Fall 15 Percent
By Home Furnishings Business in Furniture Retailing on April 2007
Bassett Furniture Inds. reported first-quarter 2007 sales of $73.4 million, down 15 percent from the same period last year. The company attributed the drop to continued soft furniture retail conditions and the sale of the Weiman upholstery operation at the end of April 2006.
The Company reported a net loss of $4.2 million or $0.35 per share as compared to net income of $2.2 million or $0.18 per share in the first quarter of 2006. The loss in the first quarter, which ended Feb. 24, included a previously announced $3.6 million non-cash pre-tax, or $0.19 per share after-tax, charge related to closing a wood manufacturing plant in Bassett, Va.
The closure of the 323,000-square-foot facility is planned to be completed during the third quarter of 2007. Bassett will source the majority of the products currently produced at this facility from overseas suppliers, continue to produce certain custom bedroom products domestically, and discontinue production of slower selling items. The company also expects to record a charge of approximately $1 million in the second quarter of 2007 for severance benefits associated with the plant closure, which cuts 280 employees, 15 percent of Bassetts workforce.
Bassetts retail program, Bassett Furniture Direct, lost one licensed store and added no locations during the second quarter. BFD now includes 105 licensed storefronts and 27 corporate locations. The company expects to open four or five new stores over the remainder of the year.
This was an extremely difficult quarter for the company both in terms of our business levels and the announcement made earlier this month related to the closing of our facility in Bassett, said Robert H. Spilman Jr., president and chief executive officer. While we are reducing our cost structure to reflect the pace of incoming orders, the company continues to pursue mid- and long-term growth initiatives on a number of fronts.
Those include sharper pricing on Spring introductions, a store-presentation improvement program, a new store prototype set for this Fall, and improvements to Bassetts consumer catalog.