Congoleum Quarterly Loss Rises, Sales Fall

Mercerville, NJ, March 11, 2010--Congoleum Corp. reported a fourth quarter net loss of $8.2 million, or $0.99 per share, compared with a net loss of $6.4 million, or $0.77 per share, a year ago.

Sales for the quarter were $28.1 million, compared with sales of $31.7 million  in the fourth quarter of 2008, a decrease of 11.3%.

The net loss for the year 2009 was $15.2 million, or $1.83 per share, compared to a net loss of $14.6 million, or $1.77 per share, in 2008. Sales for the year were $134.9 million, compared with sales of $172.6 million in 2008.

Chairman Roger S. Marcus said that without special charges or other unusual situations related to its reorganization plan, inventory reductions, and pension expenses, the company would have essentially broken even for the quarter.

"(This) was an extraordinarily challenging year due to the economic and credit climate," Marcus said.

"Demand for our products fell sharply in all our markets -- new construction, remodel, and especially manufactured housing. We made the difficult but necessary major adjustments to our workforce and spending in the first quarter of 2009 to bring our cost structure into better alignment with market conditions."

Marcus said the company doesn't expect economic conditions to improve this year and Congoleum will have to rely on new products to boost sales.

"Toward that end, we introduced a major new product line in the fourth quarter of 2009, another in the first quarter of 2010, and have a third that will be introduced during the second quarter of 2010. We believe these introductions will help generate incremental sales in 2010 despite a lackluster economy," Marcus said.

Marcus also said he believes its reorganization plan will go into effect later this year.