Dixie sees Q3 earnings hurt by lower sales
The company, which said it reduced its debt by $7 million during the quarter, also said its senior lenders have extended its credit agreement waiver until Nov. 30. The company's discussions with its lenders were delayed as a result of the Sept. 11 air attacks of the World Trade Center and Pentagon.
Analysts were forecasting earnings between 5 cents and 12 cents a share, with a mean estimate of 7 cents, according to research firm Thomson Financial/First Call. The company posted a loss of 32 cents a share in the year-earlier period.
The Dixie Group said its sales in the third quarter will be down about 11% from a year ago, due primarily to weaker demand its markets.
"We continued to improve our balance sheet, streamline our cost structure and remain profitable in a slowing economy," said Daniel K. Frierson, company chairman and CEO. "The uncertain and lagging economy has lowered sales across most product categories, delaying our ability to take full advantage of cost improvements from consolidating operations.”
Frierson noted that sales to higher-end markets served by Masland and Fabrica continue to be the least affected by the economic downturn.