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Stanley Furniture Company Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: April 17, 2012 05:02PM
Stanley Furniture Company Inc. (STLY) filed Quarterly Report for the period ended 2012-03-31. Stanley Furn Co has a market cap of $64.9 million; its shares were traded at around $4.4 with and P/S ratio of 0.6.
Highlight of Business Operations:Net sales increased $210,000, or 0.8%, for the three month period ended March 31, 2012, from the comparable 2011 period. The increase was primarily due to increased unit volume. Although we are seeing signs of improvement in the general economy, demand for the higher-end segment of residential wood furniture continues to be inconsistent.
Gross profit for the first three months of 2012 increased to $3.6 million, or 13.4% of net sales, from $1.7 million, or 6.4% of net sales, for the comparable three months of 2011. Restructuring and related charges of $768,000 are included in gross profit for the first three months of 2011. The remaining improvement in gross profit for the first quarter of 2012 resulted from lower fixed cost burden on the Stanley Furniture product line as it continued to transition during the first quarter of 2011 and improved operating efficiencies in the manufacturing of our Young America furniture as we continue to improve the cost structure for this product line.
Selling, general and administrative expenses decreased to $4.6 million, or 17.1% of net sales, for the three month period of 2012 from $5.1 million, or 19.3% of net sales, for the comparable three month period of 2011. The reduction in expenses and the lower percentage to net sales are primarily due to a decrease in spending on marketing and advertising related costs during the first quarter of 2012.
Working capital, excluding cash and restricted cash, increased during the first three months of 2012 to $31.5 million from $28.8 million on December 31, 2011. The increase was the result of increased inventory on globally sourced product, increased accounts receivable due to higher sales and the payout of accrued compensation and benefits.
Cash used by operations was $3.2 million in the current quarter of 2012 compared to $4.2 million in the comparable prior year quarter. The decrease in cash used by operations in 2012 was primarily due to an increase in cash received from customers due to higher sales, lower fixed cost on our Stanley Furniture product line and operating improvements at our Young America manufacturing facility. Partially offsetting these receipts and operational improvements was higher payments to suppliers for inventory that supports the globally sourced Stanley Furniture product line.
Stocks Discussed: STLY,