Atlanta, Oct. 22--Interface, Inc. in the third quarter of 2003 posted sales of $237.1 million, compared with $231.3
Operating income was $8.0 million in the third quarter 2003, versus $7.5 million in the third quarter 2002. Loss from continuing operations was $2.1 million, or $0.04 per share, in the third quarter 2003, compared with a loss from continuing operations of $1.8 million, or $0.03 per share, in the third quarter 2002. Net loss for the third quarter 2003 was $13.4 million, or $0.27 per share, compared with a third quarter 2002 net loss of $2.7 million, or $0.05 per share.
For the first nine months of 2003, sales were $681.3 million, compared with $691.8 million for the same period a year ago. Operating income for the 2003 nine-month period was $8.3 million (which includes $4.6 million of restructuring charges), versus operating income of $31.2 million for the comparable 2002 nine-month period. Net loss for the 2003 nine-month period was $29.2 million, or $0.58 per share, compared with a net loss of $57.5 million, or $1.15 per share, for the first nine months of 2002.
"In the third quarter of 2003, we continued to make significant improvements which strengthened our business," said Daniel T. Hendrix, President and Chief Executive Officer. "We have focused on generating top line momentum by remaining committed to our market segmentation strategy, the results of which were evident this quarter in revenue growth throughout most areas of our business. In addition, we made efforts to streamline our operations and improve our cost structure, resulting in a 7.1% year-over-year increase in operating income during the third quarter. Although many of our end markets have yet to recover from the continued weakness in the economy, we have been taking proactive measures to position our business for recovery."
Mr. Hendrix continued, "Our worldwide modular business performed strongly this quarter, with an 8.7% year-over-year increase in revenues primarily resulting from our ability to take share and capitalize on opportunities in the corporate office, education and healthcare markets. After returning to operating profitability in the second quarter of this year, our broadloom business posted a significant year-over-year increase in operating income in the third quarter, largely as a result of our cost-cutting initiatives and improvements in manufacturing efficiencies. Although our fabrics business remained flat this quarter, we have completed the restructuring initiatives that will fortify this business and position it for sustained long-term growth."
Patrick C. Lynch, Vice President and Chief Financial Officer of Interface, said, "During the third quarter, we completed the sale of Interface Architectural Resources, our raised/access flooring business, which should improve our overall profitability and enhance our free cash flow generation going forward. In addition, we continued to strengthen our balance sheet by reducing debt by $16.2 million during the third quarter."
Mr. Hendrix continued, "We are pleased to announce the addition of a new member to our Board of Directors. Edward C. Callaway is currently the Chairman of Crested Butte Mountain Resort, Inc. in Colorado, and previously served as its President and Chief Executive Officer from 1987 to 2002. Edward willjoin the Board effective today, and is replacing Len Saulter, who is retiring after more than 16 years of service as a director."
Mr. Hendrix concluded, "We are encouraged by our third quarter results and we look forward to maintaining this positive momentum into the final months of fiscal 2003. We remain committed to the strategic priorities that will allow our business to prosper, such as our market segmentation strategy, our ongoing cost management initiatives, and our focus on generating free cash flow to reduce debt."
