Sales up, but Congoleum posts 2005 loss due to asbestos charges

Although sales were up by more than $8 million over the previous year, Congoleum Corp. reported a $21.6 million loss in 2005 due to asbestos liabilities. A recently released financial report for the Mercerville, N.J.-based company indicates that expenses related to asbestos litigation grew significantly last year. The results for calendar year 2005 include $25.3 million in charges related to asbestos liabilities, including $15.5 million in the second quarter and $9.9 million in the fourth quarter. This compares to $5 million in charges to resolve asbestos liabilities in 2004.

Congoleum chairman, Roger S. Marcus, said the company is working to move past the fallout from asbestos. "It is unfortunate that the intense litigation surrounding our asbestos situation and reorganization process has greatly increased the time and cost needed to put these problems behind us. However, I am very encouraged by our latest plan, which we are currently preparing and will soon file with the Bankruptcy Court. We believe this plan will eliminate issues that were the basis of objections by opponents of prior plans. I'm optimistic that we will receive the requisite consents to confirm this plan in 2006, and that the charge in the fourth quarter, together with existing reserves, will be adequate to cover costs through the confirmation date."