"Significant weakness in the factory-built housing market and softness in our other markets during the latter part of the fourth quarter 2000 caused sales to decline approximately 14% below previous expectations," said Daniel K. Frierson, company chairman and CEO. "Production during the fourth quarter was substantially lower as a result of the declining sales and efforts to reduce inventory levels.
"In response to these issues, we have acted to bring costs in line with the softness in revenues we are experiencing and now expect during the first half of 2001. We have implemented plans to aggressively identify and reduce non-essential costs,” Frierson added. “We reduced salaried personnel in our North Georgia operations by approximately 15%, or 80 associates; closed an inefficient dyeing operation; and sold non-critical assets, such as the company's aircraft. We are further evaluating our options related to other non-strategic assets. The effect of these actions should reduce costs and improve our competitive position going forward.
"Since mid-August 2000, inventories in our Globaltex and Bretlin operations were reduced by approximately $12 million. We also completed consolidation of the tufting, finishing and distribution operations at our North Georgia tufted carpet facilities and integrated information systems at Carriage and Globaltex. Although the softness in markets served by our North Georgia tufting operations is expected to extend through the first half of 2001, our high-end business at Masland and Fabrica continues to show growth and profitable results and has not yet been significantly affected by the general economic downturn," said Frierson.