The Dixie Group Reports 2017 Results
DALTON, Ga., March 01, 2018 (GLOBE NEWSWIRE) -- The Dixie Group, Inc. (NASDAQ:DXYN) today reported financial results for the year ended December 30, 2017. For 2017, the Company had net sales of $412,462,000 as compared to $397,453,000 in 2016. On a comparable 52 week basis, 2017 net sales were up 5.2% as compared to 2016. For 2017, the Company had a loss from continuing operations of ...
Commenting on the results,
"Our commercial sales, adjusting for the 53 week 2016 period versus the 52 week period in 2017, were up slightly while the industry, we believe, was down in the low single digits. We announced the reorganization of our commercial business in October of 2017. The changes necessary to implement this organizational re-alignment are essentially complete. The savings from this Profit Improvement initiative are anticipated to be in excess of
"Our gross profit for the year was 24.5% for 2017, an improvement from our 24.0% gross profit margin in 2016. While improved, our gross profit was impacted by several major initiatives. We completed our physical restructuring earlier in the year, setting the stage for a more productive manufacturing environment. The startup costs for all our major manufacturing initiatives, including adding yarn processing to our
"Despite this difficult year from a profitability perspective, we have put in place the foundation of operational capabilities that should benefit us in the future. In 2018, we are continuing to work on achieving all of the benefits of these new capabilities as we focus on better on-time execution, lower waste and higher production efficiencies from these changes. One area of particular difficulty in 2017 has been the attraction and retention of associates in our various facilities. We anticipate further cost increases relative to associate-related costs as we deal with a tight labor market. We implemented a price increase at the beginning of 2018 to offset higher labor and other operational costs. Our capital expenditures for 2018 are planned at a maintenance level of approximately
"Selling and administrative expenses for the year were 23.3% of net sales, a decrease of 1.1 percentage points from our level of 24.4% in 2016. We will continue our hard surface initiatives with adding an engineered hardwood line to our
"Our floorcovering sales for the first 8 weeks of the quarter were flat compared to this period in 2017. Our residential sales are positive relative to 2017 while our commercial sales are behind from this same period last year. We are well positioned to continue to be the style leader in the flooring industry,” Frierson concluded.
A listen-only Internet simulcast and replay of Dixie's conference call may be accessed with appropriate software at the Company's website at www.thedixiegroup.com. The simulcast will begin at approximately
This press release contains forward-looking statements. Forward-looking statements are based on estimates, projections, beliefs and assumptions of management and the Company at the time of such statements and are not guarantees of performance. Forward-looking statements are subject to risk factors and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements. Such factors include the levels of demand for the products produced by the Company. Other factors that could affect the Company's results include, but are not limited to, raw material and transportation costs related to petroleum prices, the cost and availability of capital, integration of acquisitions, ability to attract, develop and retain qualified personnel and general economic and competitive conditions related to the Company's business. Issues related to the availability and price of energy may adversely affect the Company's operations. Additional information regarding these and other risk factors and uncertainties may be found in the Company's filings with the
Consolidated Condensed Statements of Operations | |||||||||||||||
(unaudited; in thousands, except earnings per share) | |||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
$ | 105,084 | $ | 102,606 | $ | 412,462 | $ | 397,453 | ||||||||
Cost of sales | 82,315 | 80,760 | 311,249 | 302,028 | |||||||||||
GROSS PROFIT | 22,769 | 21,846 | 101,213 | 95,425 | |||||||||||
Selling and administrative expenses | 22,384 | 25,223 | 96,171 | 96,983 | |||||||||||
Other operating (income) expense, net | 359 | (124 | ) | 441 | 401 | ||||||||||
Facility consolidation and severance expenses, net | 634 | (359 | ) | 636 | 1,456 | ||||||||||
OPERATING INCOME (LOSS) | (608 | ) | (2,894 | ) | 3,965 | (3,415 | ) | ||||||||
Interest expense | 1,535 | 1,423 | 5,739 | 5,392 | |||||||||||
Other expense, net | 1 | 7 | 39 | 22 | |||||||||||
Loss from continuing operations before taxes | (2,144 | ) | (4,324 | ) | (1,813 | ) | (8,829 | ) | |||||||
Income tax provision (benefit) | 7,283 | (1,686 | ) | 7,509 | (3,622 | ) | |||||||||
Loss from continuing operations | (9,427 | ) | (2,638 | ) | (9,322 | ) | (5,207 | ) | |||||||
Loss from discontinued operations, net of tax | (69 | ) | (79 | ) | (233 | ) | (131 | ) | |||||||
Income (loss) on disposal of discontinued operations, net of tax | — | (5 | ) | — | 60 | ||||||||||
NET LOSS | $ | (9,496 | ) | $ | (2,722 | ) | $ | (9,555 | ) | $ | (5,278 | ) | |||
BASIC EARNINGS (LOSS) PER SHARE: | |||||||||||||||
Continuing operations | $ | (0.60 | ) | $ | (0.17 | ) | $ | (0.59 | ) | $ | (0.33 | ) | |||
Discontinued operations | (0.00 | ) | (0.01 | ) | (0.01 | ) | (0.01 | ) | |||||||
Disposal of discontinued operations | — | (0.00 | ) | — | 0.00 | ||||||||||
Net loss | $ | (0.60 | ) | $ | (0.18 | ) | $ | (0.60 | ) | $ | (0.34 | ) | |||
DILUTED EARNINGS (LOSS) PER SHARE: | |||||||||||||||
Continuing operations | $ | (0.60 | ) | $ | (0.17 | ) | $ | (0.59 | ) | $ | (0.33 | ) | |||
Discontinued operations | (0.00 | ) | (0.01 | ) | (0.01 | ) | (0.01 | ) | |||||||
Disposal of discontinued operations | — | (0.00 | ) | — | 0.00 | ||||||||||
Net loss | $ | (0.60 | ) | $ | (0.18 | ) | $ | (0.60 | ) | $ | (0.34 | ) | |||
Weighted-average shares outstanding: | |||||||||||||||
Basic | 15,707 | 15,659 | 15,699 | 15,638 | |||||||||||
Diluted | 15,707 | 15,659 | 15,699 | 15,638 | |||||||||||
Consolidated Condensed Balance Sheets | |||||||
(in thousands) | |||||||
2017 | 2016 | ||||||
ASSETS | (Unaudited) | ||||||
Current Assets | |||||||
Cash and cash equivalents | $ | 19 | $ | 140 | |||
Receivables, net | 46,480 | 43,605 | |||||
Inventories, net | 113,657 | 97,237 | |||||
Other | 3,600 | 4,376 | |||||
Total Current Assets | 163,756 | 145,358 | |||||
Property, Plant and Equipment, Net | 93,785 | 92,807 | |||||
5,850 | 6,156 | ||||||
Other Assets | 19,447 | 24,666 | |||||
TOTAL ASSETS | $ | 282,838 | $ | 268,987 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current Liabilities | |||||||
Accounts payable and accrued expenses | $ | 48,832 | $ | 53,509 | |||
Current portion of long-term debt | 9,811 | 10,122 | |||||
Total Current Liabilities | 58,643 | 63,631 | |||||
Long-Term Debt | 123,446 | 98,256 | |||||
Other Liabilities | 21,486 | 19,978 | |||||
Stockholders' Equity | 79,263 | 87,122 | |||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 282,838 | $ | 268,987 | |||
Use of Non-GAAP Financial Information:
(in thousands)
The Company believes that non-GAAP performance measures, which management uses in evaluating the Company's business, may provide users of the Company's financial information with additional meaningful bases for comparing the Company's current results and prior period results, as these measures reflect factors that are unique to one period relative to the comparable period. However, the non-GAAP performance measures should be viewed in addition to, not as an alternative for, the Company's reported results under accounting principles generally accepted in
Non-GAAP Summary | |||||||||||||||||||
Twelve Months Ended | |||||||||||||||||||
Net Sales As Adjusted | Week 53 | Increase (Decrease) | |||||||||||||||||
Net Sales As Adjusted (Note 1) | $ | 412,462 | $ | 397,453 | $ | (5,380 | ) | $ | 392,073 | $ | 20,389 | 5.2 | % | ||||||
(Note 1) The Company defines | |||||||||||||||||||
Twelve Months Ended | |||||||||||||||||||
Adjusted for Tax Cut and Jobs Act of 2017 (Note 2) | 2017 | ||||||||||||||||||
Net loss as reported | $ | (9,555 | ) | ||||||||||||||||
Loss from discontinued operations | (233 | ) | |||||||||||||||||
Loss from continuing operations | (9,322 | ) | |||||||||||||||||
Impact of Tax Cuts and Jobs Act of 2017 | 8,169 | ||||||||||||||||||
Loss from continuing operations less affect of Tax Cuts and Jobs Act of 2017 | $ | (1,153 | ) | ||||||||||||||||
Diluted shares | 15,699 | ||||||||||||||||||
Adjusted loss per diluted share | $ | (0.07 | ) | ||||||||||||||||
(Note 2) The Company defines Non-GAAP earnings per Share (EPS) for the Tax Cuts and Jobs Act of 2017 (the "Tax Act") as Net Income less discontinued operations minus the effect of the Tax Act and divided by the number of fully diluted shares. | |||||||||||||||||||
Further non-GAAP reconciliation data are available at www.thedixiegroup.com under the Investor Relations section. | |||||||||||||||||||
CONTACT:
Chief Financial Officer
706-876-5814
jon.faulkner@dixiegroup.com