St. Louis, MO, February 1, 2007--Furniture Brands International Inc. reported fourth-quarter earnings that dropped 88 percent on weakened sales that grew just over 1 percent.
The company said its profit for the fourth quarter ended December 31 dropped to nearly $2.1 million on net sales of $586.5 million, compared with profit of $17.1 million on revenue of $593.5 million in the same period of 2005.
In December, Furniture Brands chairman and CEO W.G. "Mickey" Holliman said that because business conditions in the fourth quarter had continued to soften since October, the firm planned to "aggressively" discount selected slow-moving products. He also lowered the company's fourth-quarter guidance.
The company reported that its profit for fiscal year 2006 fell 10.4 percent to $55.1 million from $61.4 million in fiscal 2005. Its revenue for the year improved by 1.3 percent to $2.42 billion from $2.39 billion last year.
Holliman said, "Business conditions in the fourth quarter were difficult across all our companies. As the quarter progressed, retail conditions materially softened. In an effort to continue with our original plan of inventory reduction, we promoted aggressively and took additional discounts on selected slower moving products. We also scheduled additional downtime in our domestic facilities. Both of these items had a significant impact on our earnings for the quarter."
Next month, Furniture Brands' Broyhill Furniture Industries subsidiary plans to halt operations at its Lenoir, N.C., goods manufacturing facility.
Furniture Brands International manufactures furniture under the Thomasville, Henredon, Drexel Heritage, Maitland-Smith, Broyhill and Lane brands.
