The Dixie Group Reports Financial Results 2022
DALTON, GA / ACCESSWIRE / March 2, 2023 / The Dixie Group, Inc. (NASDAQ:DXYN) today reported financial results for the fiscal year ended December 31, 2022.Net sales for the fiscal year of 2022 were $304 million, or 11% below the net sales of $341 million in the fiscal year of 2021.The net loss for the fiscal year end 2022 was $35.1 million with a $33.4 million loss from continuing ...
- Net sales for the fiscal year of 2022 were
$304 million, or 11% below the net sales of $341 millionin the fiscal year of 2021.
- The net loss for the fiscal year end 2022 was
$35.1 millionwith a $33.4 millionloss from continuing operations.
- The plan for the consolidation of our east coast facilities has resulted in a 24% reduction of associates and is expected to result in estimated savings of over
For the year 2022, net sales from continuing operations for the Company were
Commenting on the results,
Beginning in the mid second quarter of 2022, the flooring industry started to see a decrease in demand that persisted through the remainder of the year. High inflation and rising interest rates negatively impacted consumer confidence and lowered discretionary spending. Home sales and residential remodeling both declined in the second half of the year.
Our net sales in 2022 also reflected the year over year loss of approximately
Our gross margins in 2022 were negatively impacted by excessively high material costs as a result of our former primary raw material supplier's abrupt exit from the business, dramatic increases in ocean freight which impacted our imported hard surface inventory and overall higher material costs from most suppliers as a result of inflation. Due to the rapid timing and magnitude of these increases, we were not able to raise the prices to our customers at the same rate. Fortunately, by the end of the year we began to see costs decline but, during the 4th Quarter, we continued to work through inventory at inflated values due to costs incurred in earlier periods. In addition, our gross margin in the fourth quarter was also negatively impacted by our decision to scale back production in our plants in line with decreased demand and our plan to reduce inventories. This decreased production resulted in higher expenses for unabsorbed overhead.
In the third quarter of 2022 we began our plan to consolidate our manufacturing operations on the east coast. This plan was implemented to lower our fixed and variable costs by shutting higher cost assets, reducing staffing and aligning production with demand. Under this plan we consolidated all of our east coast tufting operations to our plant in
During the fourth quarter, we continued executing the launch of our new decorative segment programs, 1866 by Masland and Décor by Fabrica. This key growth initiative included 30 new styles and, despite soft market conditions, we are seeing strong placement of product with our customers and order entry momentum continues to build.
In our nylon segment, we launched our remaining new soft surface EnVision Nylon carpet introductions into the market in the fourth quarter of 2022. In our TRUCOR line of luxury vinyl flooring, we launched TRUCOR Boardwalk, a collection of 12SPC SKUs featuring lighter, coastal colors and a pillowed edge for a realistic wood visual. This collection is 6.5mm thick for long lasting durability and easy installation.
In 2023, we are launching a broad mix of new products, including new price point items in soft and hard surfaces, and beautiful high end carpet styles in the nylon and decorative segments. In the first 7 weeks of this year, we have seen a pick up in order entry and are running less than 5% below prior year demand levels. We are encouraged by the strong attendance levels and positive customer sentiment at the regional and national trade shows in early 2023." Frierson concluded.
The gross profit margin for the full year of 2022 was 17.7% of net sales compared with 22.6% in the prior year fiscal year. Selling and general administrative expenses were
Our receivables decreased at fiscal year-end 2022 as compared to the end of the fiscal year 2021. The decrease of
Our debt increased by
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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, availability of 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 Statements of Operations
(unaudited; in thousands, except earnings per share)
|Three Months Ended||Year Ended|
Cost of sales
Selling and administrative expenses
Other operating (income) expense, net
Facility consolidation and severance expenses, net
OPERATING INCOME (LOSS)
Other expense, net
Income (loss) from continuing operations before taxes
Income tax provision (benefit)
Income (loss) from continuing operations
Income (loss) from discontinued operations, net of tax
BASIC EARNINGS (LOSS)PER SHARE:
Net income (loss)
DILUTED EARNINGS(LOSS) PER SHARE:
Net income (loss)
Weighted-average shares outstanding:
Consolidated Condensed Balance Sheet
Cash and cash equivalents
Current assets of discontinued operations
Total Current Assets
Property, Plant and Equipment, Net
Operating Lease Right-Of-Use Assets
Long-Term Assets of Discontinued Operations
LIABILITIES AND STOCKHOLDERS' EQUITY
Current portion of long-term debt
Current portion of operating leaseliabilities
Current liabilities of discontinued operations
Total Current Liabilities
Operating Lease Liabilities
Other Long-Term Liabilities
Long-Term Liabilities of Discontinued Operations
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
Chief Financial Officer 706-876-5865
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