CONTACT: William Johnson, CEO/President
Decorator Industries Reports Fourth Quarter 2007 Results
PEMBROKE PINES, Fla., Feb. 29 /PRNewswire-FirstCall/ -- Decorator
Industries, Inc. (AMEX: DII), a supplier of interior furnishings for
recreational vehicles ("RV"), manufactured housing ("MH") and the hospitality
industry, today announced results for the three and twelve month periods ending
December 29, 2007.
Net sales for fiscal 2007 decreased 12% to $46,080,584 compared with
$52,237,720 in 2006. Fourth quarter 2007 net sales decreased 7% to $9,921,813
compared to $10,627,562 for the same period a year ago.
Net loss for fiscal 2007 was $807,509 or 27 cents per diluted share
compared with net income of $405,393 or 13 cents per diluted share for fiscal
2006. Net loss for the fourth quarter of 2007 was $664,788 or 22 cents per
diluted share compared with net loss of $268,378 or 9 cents per diluted share in
last year's fourth quarter.
Mr. Johnson, CEO/President stated:
"The sales decrease in the fourth quarter and year can be attributed to
the continued slow down in the RV and MH markets. Sales to our RV customers for
fiscal 2007 decreased 18% to $25,165,000 compared with $30,756,000 for fiscal
2006. RV sales for the quarter decreased by 21% to $4,708,000, compared with
last year's sales for the same period of $5,990,000. The RV industry reported a
3% decline in total shipments during the fourth quarter, with towable shipments
decreasing by 3% and motor home shipments declining by 4%. Industry shipments
for 2007 were down 9%, with towable shipments decreasing 11% and motor homes
down 1%.
"Sales to our MH customers for fiscal 2007 decreased about 14%, to
$8,100,000 compared with $9,464,000 for fiscal 2006. MH sales for the quarter
increased by about 2% to $1,895,000, compared with last year's fourth quarter
sales of $1,854,000. This included sales of Doris Lee Draperies, acquired in
November 30, 2007, of $158,000 in the fourth quarter and for the year 2007. The
Manufactured Housing Institute reported that industry shipments decreased about
3% for the fourth quarter of 2007, resulting in a decrease for the year of about
18%.
"Sales to our Hospitality customers increased 7% for fiscal 2007 to
$12,816,000 from $12,018,000 for fiscal 2006. Hospitality sales increased about
19% to $3,319,000 in the fourth quarter of 2007 from $2,784,000 in the fourth
quarter a year ago. This included sales from Superior Drapery, acquired on June
1, 2007, of $585,000 in the fourth quarter of 2007 and $1,349,000 for the year.
The hospitality industry continues to remain strong with Lodging Econometrics
forecasting 133,628 new rooms in 2008 and 165,000 new rooms in 2009. This is in
addition to the 4.4 million rooms in existence nationwide that are renovated
approximately every five years.
"Fiscal year 2007 and the fourth quarter results include inventory
write-offs totaling $640,000 for the year and $298,000 for the quarter and
excess labor cost of $522,000 for the year and $116,000 for the quarter. These
increased costs were largely caused by the significant slow down in both the RV
and MH business. Management continues to pursue cost efficiencies including
improving inventory buying practices and reducing headcount. During 2007, we
have reduced our workforce by over 22%. Fixed costs were up slightly for the
year due to the acquisition of Superior Drapery and Doris Lee Draperies but
these increased costs were offset by reduced incentive compensation costs. We
have completed the transition period and finished moving the Doris Lee customers
into our existing facilities and expect to realize the full benefit of this
acquisition in the second quarter of 2008.
"Our financial condition remains strong with stockholders' equity of
$16,411,651. Long term debt was $1,409,000 or 7.9% of total capital. The loss in
the fourth quarter caused the Company to violate one of the financial covenants
contained in our agreement. The lender has informed the Company that they will
work on an amendment to the loan agreement.
"We continue to pursue opportunities for growth in the markets we serve.
We continue to make strategic investments in the business in an effort to ensure
we are the supplier of choice in the markets we serve."
Statements contained in this release that are not historical facts are
forward-looking statements that could differ materially from actual results.
Primary factors that could cause actual results to materially differ from those
in the forward-looking statements are the level of demand for recreational
vehicles, manufactured housing and hotel/motel accommodations, the general
economic conditions, interest rate fluctuations, competitive products and
pricing pressures within the Company's markets, the Company's ability to contain
its manufacturing costs and expenses, and other factors.
Decorator Industries, Inc., founded in 1953, designs, manufactures and
sells interior furnishing products, principally draperies, curtains, shades,
blinds, valance boards, bedspreads, comforters, pillows, cushions and trailer
tents. Decorator is a leading supplier of such products to the manufactured
housing and recreational vehicle markets and is a growing supplier to the
hospitality industry.
(DIIG)
THE FIGURES ARE AS FOLLOWS
DECORATOR INDUSTRIES, INC
STATEMENTS OF EARNINGS
For the Thirteen Weeks Ended For the Fiscal Year
(Unaudited) (Audited)
December 29, December 30, 2007 2006
2007 2006
Net Sales $ 9,921,813 $10,627,562 $46,080,584 $52,237,720
Cost of Products
Sold 8,818,292 8,761,311 38,798,908 42,926,510
Gross Profit 1,103,521 1,866,251 7,281,676 9,311,210
Selling and
Administrative
Expenses 2,177,223 2,278,458 8,575,289 8,688,386
Operating (Loss)/
Income (1,073,702) (412,207) (1,293,613) 622,824
Other Income (Expense)
Interest, Investment
and Other Income 14,493 21,656 94,320 112,649
Interest Expense (23,579) (27,827) (92,216) (90,080)
(Loss)/Earnings
Before Income
Taxes (1,082,788) (418,378) (1,291,509) 645,393
Provision for Income
Taxes (418,000) (150,000) (484,000) 240,000
Net (Loss)/Income $(664,788) $ (268,378) $(807,509) $405,393
(LOSS)/EARNINGS
PER SHARE
Basic $ (0.22) $(0.09) $(0.27) $ 0.14
Diluted $ (0.22) $(0.09) $(0.27) $ 0.13
Weighted Average
Number of Shares
Outstanding
Basic 3,011,292 2,998,666 3,005,988 2,982,735
Diluted 3,011,292 2,998,666 3,005,988 3,036,488
CONDENSED BALANCE SHEETS
(Audited)
December 29, December 30,
2007 2006
Cash and Equivalents $17,544 $11,379
Accounts Receivable 3,423,072 3,725,167
Inventories 5,181,645 5,651,252
Other Current Assets 868,371 984,145
Total Current Assets 9,490,632 10,371,943
Net Property and Equipment 9,283,489 9,703,167
Other Assets 5,489,783 4,923,461
Total Assets $24,263,904 $24,998,571
Total Current Liabilities $5,577,253 $4,989,585
Long-Term Debt 1,409,000 1,741,444
Deferred Taxes 866,000 839,000
Stockholders' Equity 16,411,651 17,428,542
Total Liabilities and
Stockholders' Equity $24,263,904 $24,998,571
SOURCE Decorator Industries, Inc.