Pergo Reports Year-End Results
Trelleborg, Sweden, February 14—-Pergo issued its year-end report, for the twelve months ended December 31, 2004. (Figures in brackets (xx) correspond to the figures for the same period last year). The company called 2004 a year of restructuring.
In 2004 net sales totaled SEK 2,780 million (2,799) ($396.7M), a 6% rise compared with 2003, excluding currency effects.
Net sales for the fourth quarter were SEK 682 million (732), ($92.2M) a 1% drop compared with 2003, excluding currency effects.
The company posted an operating loss for the year of SEK 191 million (-146) ($27.2M), which includes costs of SEK 253 million ($ 36.1M) (-190) reported as items affecting comparability. Excluding items affecting comparability, the operating profit for the full year was SEK 62 million ($8.8M) (44) and SEK 16 million (17) for the fourth quarter.
The loss after tax for 2004 was SEK 197 million, ($28.1M) (-169). The EPS for 2004 was SEK -3.68 ($0.52) (-3.15). The negative impact of currency effects on the year’s results was SEK 32 million ($ 4.6M), compared with 2003.
Net sales in North America in the fourth quarter were SEK 383 ($54.6M) (462) 1 639(1 728). Net sales in Europe during the quarter were SEK 269 ($35.4M)(233) 1 019 (949)
In discussing the results, CEO Göran Bernhoff said, "Pergo initiated highly extensive restructuring and new investment projects in both Europe and the USA in 2004. These will be completed during Q3 2005 and make the company more effective and competitive."
Göran Bernhoff said, "Pergo improved its operating profit in 2004. Despite the loss of a premium product to The Home Depot, the profit in North America is better than last year when market and supply are consolidated.
"European business activities have significantly strengthened the gross margin and operating profit. In addition, our move to complement our premium products by expanding our range of mid-price segment products generated good results.
"We will gradually benefit from the investments of the past year in 2005. We will become more active on our most important markets and fully exploit the constant global growth of the laminate flooring segment. We will proceed with our wood flooring initiatives and at the same time launch many new products."
Net sales for 2004 stood at SEK 2,780 million (2,799), a 6% increase compared with 2003, excluding currency effects.
Sales figures on the North American market boosted net sales by 4% in local currency, due to higher sales to Lowe’s, the world’s second largest chain of home improvement stores. In Europe, sales climbed 8%, adjusted for currency effects.
During Q1 earnings were charged with SEK 250 million in conjunction with the ongoing restructuring of European product supply. Most of the costs affected the gross margin. Excluding these costs the gross margin was 25% for the full year, about 3 percentage points over 2003.
The operating loss for the year was SEK 191 million (-146). Excluding items affecting comparability, the company reports an operating profit of SEK 62 million (44). These items include primarily the aforementioned restructuring costs.
The operating loss for 2003 was in a similar way mainly adjusted for Witexrelated items of SEK -168 million.
Foreign exchange fluctuations had a negative impact on earnings of about SEK 32 million compared with 2003. These changes primarily refer to Pergo Inc.’s transaction exposure.
Net sales for Q4 totaled SEK 682 million (732), a 1% decline excluding currency effects. Whiles sales continue to climb in Europe, figures dropped in North America due mainly to the previously announced reduction of Pergo’s store space at The Home Depot.
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