Stanley Furniture Company, Inc. (Nasdaq-NGS: STLY) today reported sales and operating results for the second quarter of 2012.
Second quarter 2012 highlights:
- Net sales were $24.4 million, a 10.8% decrease compared to the second quarter of 2011 and an 8.8% decrease on a sequential quarter basis.
- Gross margin improved to 14.5% of net sales compared to 12.3% in the second quarter of 2011, after excluding restructuring items.
- Selling, general and administrative expenses were $4.5 million (18.4% of net sales) compared to $4.7 million (17.3%) in the second quarter of 2011.
- The company continued the consolidation of its Virginia warehousing operations and recorded a $474,000 restructuring charge.
- Net of restructuring items, operating loss for the second quarter was $932,000 compared to a loss of $1.4 million in second quarter of 2011.
- The company reported net income of $36.9 million in the second quarter after recording $39.4 million of income, net of expenses, from Continued Dumping and Subsidy Offset Act (CDSOA) proceeds.
- As of June 30, 2012, the company’s financial position reflected $47.4 million in cash, restricted cash and short-term investments.
- Subsequent to quarter end, the Board authorized a $5.0 million share repurchase program.
Year to date 2012 highlights:
- Net sales were $51.2 million compared to $54.0 million in the first half of 2011.
- Gross margin improved to 14.0% of net sales compared to 10.8% in the first six months of 2011, excluding restructuring charges in both years.
- Selling, general and administrative expenses improved to 17.7% of net sales compared to 18.3% in 2011.
- Net of restructuring charges, operating loss for the first half of 2012 narrowed significantly to $1.9 million when compared to a loss of $4.1 million in the first half of 2011.
- Capital expenditures and investment in new systems totaled $3.9 million in the first half of 2012.
Overview“We are very pleased with the ability we have demonstrated to manage our cost structure and reduce our operating losses on lower sales volume”, commented Glenn Prillaman, President and Chief Executive Officer. “We continue to gain momentum with our Stanley brand. While net sales of this product line decreased sequentially as a result of our promotions during the first quarter, they held steady compared to the prior year quarter, our strongest of 2011. According to our retailers, the value of our Stanley product offerings has noticeably increased since this time last year. Our partnerships with overseas vendors continue to strengthen our service position, a key factor that has hindered sales growth to date. Our plan for the Stanley line is working as profits continue to grow.”