Dalton, GA, Apr. 28--Tandus Group, Inc., which includes C&A Floorcoverings, Monterey Carpets and Crossley Carpet Mills, had adjusted EBITDA of $8.9 million in its fourth quarter ended January 25, compared to $10.3 million for the same period a year ago. Revenues for the fourth quarter were $70.6 million, compared to $61.7 million for the same period a year ago.
The increase in revenues was due to the inclusion of $7.2 million in extrusion revenues and a slight increase in the non-extrusion business.
Adjusted EBITDA declined due to certain selling, general and administrative investment costs during the quarter to support the new sales and marketing strategy announced at the end of the third quarter of the year and under-utilization of the plants, partially offset by lower spending and cost savings initiatives. Adjusted EBITDA for the year was $53.8 million compared to $59.8 million for the prior year.
Revenues for the year were $321.2 million compared to $322.0 million for the prior year.
Adjusted EBITDA margin for the year was 16.8%, compared to 18.6% for the year before. The decline in revenues was due to a decrease in the company's corporate office and retail end markets, largely due to the U.S. economic situation, offset by the inclusion of $23.2 million in revenues generated by the extrusion operation, which was acquired May 8, 2002.
The adjusted EBITDA decline relates to the shortfall in the non-extrusion revenues and the inclusion of the lower margin extrusion results of operation since acquisition date.
Despite lower revenue and adjusted EBITDA results for the year, the company voluntarily prepaid $8.0 million in term loans, and before year end voluntarily prepaid another $10.0 million in term loans.
"It's critical that companies constantly look for a better way to serve the customer," said Mac Bridger, CEO of Tandus. ³In our view, the best time to do this is during difficult economic environments such as we face today. Our diverse end market strategy has protected us somewhat, helping us gain market share in a declining market.
"We¹re encouraged by our team's responsiveness and success in executing the new market strategy established last fall. This strategy leverages our physical assets, great product brands, and talented people," said Bridger. "By uniting our strengths behind this common purpose, we are poised for significant growth in all end markets. Though we¹re in the early stages, we feel confident that we¹re building momentum to achieve meaningful financial improvement over the next several quarters."
