STANLEYTOWN, Va.-- Stanley Furniture Company, Inc. (Nasdaq-NGS: STLY) today reported sales and operating results for 2010. Net sales of $137.0 million decreased 14.6% compared to 2009. A net loss of $43.8 million ( $4.11 per share) was incurred in 2010 compared to a net loss of $11.8 million ( $1.14 per share) in 2009. The increased loss in 2010 resulted primarily from the near-term impact of actions taken in conjunction with the Company’s restructuring plans and lower sales. Income of $1.6 million was recorded in 2010 from the receipt of funds under the Continued Dumping and Subsidy Offset Act of 2000 (CDSOA) involving wooden bedroom furniture imported from China and other related payments, net of legal expenses compared to $9.3 million in 2009. Cash on hand was $25.5 million at December 31, 2010. Working capital, excluding cash and current maturities of long-term debt, decreased to $27.2 million at year-end 2010 compared to $46.9 million at December 31, 2009. The lower working capital is primarily due to reductions in inventories and accounts receivable in response to lower sales. Several special items in the fourth quarter of 2010 impacted the Company’s cash flows. These items included:
- receipt of $2.2 million from CDSOA payments in connection with the case involving wooden bedroom furniture imported from China,
- raising $12.0 million from the issuance of 4 million shares of its common stock in a rights offering,
- prepayment in full of the Company’s outstanding debt with Prudential Insurance Company of America and other lenders in the amount of $15 million,
- receipt of $2.3 million from the sale of machinery and equipment no longer needed as a result of ceasing production at the Stanleytown, Virginia facility, and
- receipt of $4.9 million from the sale of the Stanleytown, Virginia facility and Martinsville, Virginia facility.
“The Company's two branded product lines now utilize distinct operational models. Each model is specifically tailored to address the demand drivers for that product line in the wood residential market’s premium segment. “Our adult furniture product line, marketed as Stanley Furniture, is now made completely offshore since we ceased manufacturing in our Stanleytown facility late last year. We are the most important customer to a minimal number of smaller, specialty manufacturers in Southeast Asia. Style and finish are the key points of product differentiation in the luxury case goods market. Our overseas associates are experts in these areas and deliver these product features at a tremendous value to our customer. “Our infant/youth furniture product line, marketed as Young America, is now manufactured domestically in one facility of our own because proximity to market and production control positions us to differentiate our products from competition through customization, selection, quick delivery and the ability to provide parents assurance of safe, healthy products for their child,” concluded Prillaman. Conference Call Details Management will host a conference call at 9:00 a.m. EST on February 3, 2011. The dial-in number is (877) 407-8029. The call will also be web cast and archived on the Company’s web site at www.stanleyfurniture.com. The dial-in-number for the replay (available through February 10, 2011) is (877) 660-6853, the account reference number is 275 and the conference number is 365431. About Stanley Furniture Company, Inc. Established in 1924, Stanley Furniture Company, Inc. is a leading designer and manufacturer of wood furniture targeted at the premium price range of the residential market. Its common stock is traded on the Nasdaq stock market under the symbol STLY. Forward Looking Statements Certain statements made in this news release are not based on historical facts, but are forward-looking statements. These statements can be identified by the use of forward-looking terminology such as “believes,” “estimates,” “expects,” “may,” “will,” “should,” or “anticipates,” or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy. These statements reflect our reasonable judgment with respect to future events and are subject to risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such risks and uncertainties include our success in profitably producing Young America products in our domestic manufacturing facility, disruptions in offshore sourcing including those arising from supply or distribution disruptions or those arising from changes in political, economic and social conditions, as well as laws and regulations, in countries from which we source products, international trade policies of the United States and countries from which we source products, our success in transitioning our adult product line to offshore vendors, the inability to raise prices in response to inflation and increasing costs, lower sales due to worsening of current economic conditions, the cyclical nature of the furniture industry, failure to anticipate or respond to changes in consumer tastes and fashions in a timely manner, business failures or loss of large customers, competition in the furniture industry including competition from lower-cost foreign manufacturers, the inability to obtain sufficient quantities of quality raw materials in a timely manner, environmental, health, and safety compliance costs, and extended business interruption at our manufacturing facility. Any forward-looking statement speaks only as of the date of this news release and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise.
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