ST. LOUIS -- Furniture Brands International reported a net loss of $2.1 million on sales of $272.0 million for the 2010 third quarter compared to a net loss of $23.5 million on sales of $293.7 million in the third quarter of 2009.
Net sales for the third quarter of 2010 reflect the timing of the company's annual mid-year manufacturing shutdown, which occurred in the third quarter of 2010 versus the second quarter of 2009. The company estimates that the timing of the weeklong shutdown resulted in an approximately $11 million negative variance in the comparison of third quarter 2010 and 2009 net sales. The year-over-year sales comparison was also negatively affected by the company's exiting two unprofitable lines of ready-to-assemble business. Recently, FBI announced plans to shut down its Appomattox, VA, RTA plant.The company's cash position declined by $32.6 million during the third quarter of 2010 as the company increased inventories of key raw materials and high-demand finished goods by $25 million and invested in its Indonesian plant expansion and SAP integration.
"Earlier this year, Furniture Brands elected to increase stocks of essential raw materials and finished products to protect against any potential disruptions in the Asian supply chain, to meet current consumer demand for recently introduced products as well as support our commitments to dealers at the October High Point Market," said Chairman and CEO Ralph Scozzafava. "The increased inventory is primarily related to our newest and best-selling products so that we're ready to take advantage of the fourth and first quarters, which have historically been our strongest revenue periods."
Read Furnture Brand International's press release.
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