The Dixie Group Reports Losses for Q4 & FY 2016

Chattanooga, TN, March 6, 2017—The Dixie Group reported net sales of $102,606,000 for Q4 2016 compared to net sales of $107,763,000 for Q4 2015.

For Q4 2016, The Dixie Group reported net loss of $2,722,000, or diluted loss per share of $0.17, compared with net loss of $528,000 in Q4 2015, or a loss of $0.03 in Q4 2015.

For FY 2016, the company reported net sales of $397,453,000, a 5.9% decrease from FY 2015’s net sales of $422,483,000 for FY 2015.

For FY 2016, The Dixie Group reported net loss of $5,278,000, or diluted loss per share of $0.33, compared with net loss of $2,426,000, or diluted loss per share of $0.15, in FY 2015.

Commenting on the results, Daniel K. Frierson, chairman and chief executive officer, said, “Our carpet sales for 2016 were down 6.0% from 2015, on a comparable 52 week basis, while the industry, we believe, was down in the low single digits. In the fourth quarter our total carpet sales were down 7.7% while the industry was flat. Sales of our residential products were down approximately 3% on a comparable 52 week basis in 2016 versus 2015 while the industry was down similarly. Our commercial product sales on a year over year basis were down over 11% while the industry was down slightly, also on a 52 week equivalent basis... Despite this difficult year from a profit perspective, we have made several significant changes to improve our results in the future. We completed our restructuring earlier in the year, setting the stage for a more productive manufacturing environment. This completes the separation of our east coast commercial and residential facilities. Our claims expense has declined significantly as our workforce training has taken effect, improving our quality. We refinanced our debt, pushing out the maturity until 2021. We have reduced our inventory to levels in line with our sales and reflecting the improvements in reduced waste and shorter throughput times. As the quarter ended, the industry announced a price increase based on many increases in cost of both labor and raw material. This price increase included both residential and commercial products. We launched a series of new distinctive products in our residential market in 2016.”