Fourth Quarter Results Better than Expected
STANLEYTOWN, Va., Jan. 24 /PRNewswire/ -- Stanley Furniture Company, Inc.
(Nasdaq: STLY) today reported record sales and earnings for 2000. Net sales
of $283.1 million in 2000 grew 6.9% over last year. Net income reached $19.5
million or $2.63 per diluted share, compared to $19.2 million or $2.47 per
diluted share in 1999.
Operating income as a percent of net sales was 12.3% for 2000, compared to
13.0% in 1999. The decrease resulted primarily from start-up costs associated
with the new factory, which began production of home office furniture in March
2000. Also, results were impacted by operating inefficiencies stemming from a
change in product mix at several other plants as product was moved to the new
facility, higher raw material cost, and increased labor cost. Lower selling,
general and administrative expenses and other improvements in operating
efficiencies helped to offset these increases.
Fourth quarter 2000 results were better than previously anticipated. Net
sales were at the high end of the expected range, and operating expenses and
income tax expense were lower than anticipated. Fourth quarter 2000 net sales
were $68.6 million, a decrease of 5.2% from the exceptionally strong prior
year quarter. Fourth quarter 1999 net sales increased 13.1% over the previous
year as some additional capacity became operational. Fourth quarter 2000 net
income was $4.3 million or $.61 per diluted share, compared to $5.7 million or
$.74 per diluted share in the year ago quarter.
Cash flow for 2000 was very positive due to strong earnings. Total debt
of $52.2 million at December 31, 2000 was well within targeted levels.
Working capital increased $15.2 million primarily due to higher inventories
necessary to support the sales growth and to return customer service levels to
the Company's target range of shipping product in less than three weeks on
average. The Company used $19.8 million to purchase 869,400 shares of its
common stock at an average price of $22.72 in 2000. Approximately $10 million
remains authorized by the Company's Board of Directors to repurchase its
shares.
"We are very pleased with our performance in 2000, particularly the
successful start-up of a new state-of-the-art factory focused on making home
office furniture that gives us a competitive advantage in this fast growing
category," commented Albert L. Prillaman, president and chief executive
officer of Stanley Furniture Company. "The new factory was profitable in the
fourth quarter and we expect it to contribute to earnings throughout 2001 and
beyond."
"The new year poses a challenging economic environment. The slowdown
experienced in the latter part of 2000 has continued into 2001. Quite
frankly, we do not expect business conditions to improve before the second
half of 2001. Consequently, we expect first quarter 2001 sales and earnings
to be in a range from modestly below to about the same as the prior year. We
continue to believe that the long-term prospects for the furniture industry
are quite healthy based on a strong U.S. economy and favorable demographic
trends. Furthermore, we believe the Company is well positioned in the
marketplace and will continue to outperform the industry in sales growth,"
continued Mr. Prillaman.
The Company will hold a conference call today at 10:00 a.m. Eastern Time.
The dial-in-number is 913-981-5508. A replay will be available through
January 31, 2001. The dial-in-number for the replay is 719-457-0820 with an
access code of 490690.
Established in 1924, Stanley Furniture Company, Inc. is a leading
manufacturer of wood furniture targeted at the upper-medium price range of the
residential market. Manufacturing facilities are located in Stanleytown and
Martinsville, VA, and Robbinsville, Lexington, and West End, NC. Its common
stock is traded on the Nasdaq stock market under the symbol STLY.
For more information, visit our Website at
http://www.stanleyfurniture.com .
Certain statements made in this release are not based on historical facts,
but are forward-looking statements. These statements can be identified by the
use of forward-looking terminology such as "believes," "expects," "may,"
"will," "should," or "anticipates" or the negative thereof or other variations
thereon or comparable terminology. These statements reflect the Company's
reasonable judgment with respect to future events and are subject to risks and
uncertainties that could cause actual results to differ materially from those
in the forward-looking statements. Such risks and uncertainties include the
cyclical nature of the furniture industry, fluctuations in the price of lumber
which is the most significant raw material used by the Company, competition in
the furniture industry, capital costs and general economic conditions.
STANLEY FURNITURE COMPANY, INC.
Operating Results
(In thousands, except per share data)
(unaudited)
Three Months Ended Year Ended
December 31, December 31,
2000 1999 2000 1999
Net sales $ 68,561 $ 72,353 $ 283,092 $ 264,717
Cost of sales 52,618 53,873 214,499 196,631
Gross profit 15,943 18,480 68,593 68,086
Selling, general and
administrative
expenses 8,239 8,745 33,656 33,796
Operating income 7,704 9,735 34,937 34,290
Other expense
(income), net (27) 52 (82) 388
Interest expense 1,079 859 4,003 3,478
Income before
income taxes 6,652 8,824 31,016 30,424
Income taxes 2,339 3,150 11,476 11,211
Net income $4,313 $5,674 $19,540 $19,213
Earnings per share:
Basic $0.64 $0.80 $ 2.76 $2.70
Diluted $0.61 $0.74 $ 2.63 $2.47
Weighted average
number of shares:
Basic 6,780 7,099 7,076 7,119
Diluted 7,071 7,662 7,429 7,770
STANLEY FURNITURE COMPANY, INC.
Condensed Balance Sheets
(In thousands)
December 31,
2000 1999
Assets
Current assets:
Cash $1,825 $3,597
Accounts receivable, net 33,224 32,133
Inventories 54,423 43,580
Prepaid expenses and other current assets 568 1,011
Deferred income taxes 2,514 2,463
Total current assets 92,554 82,784
Property, plant, and equipment, net 70,455 72,100
Goodwill 9,408 9,744
Other assets 6,789 5,894
Total assets $179,206 $170,522
Liabilities and Stockholders' Equity
Current liabilities:
Current maturities
of long-term debt $6,714 $5,236
Accounts payable 19,507 25,836
Accrued expenses 12,574 13,181
Total current liabilities 38,795 44,253
Long-term debt 45,455 33,168
Deferred income taxes 10,860 11,072
Other long-term liabilities 4,619 2,456
Stockholders' equity 79,477 79,573
Total liabilities and
stockholders' equity $179,206 $170,522
SOURCE Stanley Furniture Company, Inc.
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Related links:
http://www.stanleyfurniture.com
Company News On-Call:
http://www.prnewswire.com/comp/117677.html or fax,
800-758-5804, ext. 117677
CONTACT:
Douglas I. Payne, Sr. V.P., Finance and
Administration, 540-627-2157, or dpayne@stanleyfurniture.com, or
Anita W. Wimmer, Treasurer, 540-627-2446, or
awimmer@stanleyfurniture.com, both of Stanley Furniture Company,
Inc.
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