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Furniture Brands International Inc. Reports Operating Results (10-Q)

August 06, 2010 | About:
10qk

10qk

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Furniture Brands International Inc. (FBN) filed Quarterly Report for the period ended 2010-06-30.

Furniture Brands International Inc. has a market cap of $298.2 million; its shares were traded at around $5.86 with and P/S ratio of 0.2. FBN is in the portfolios of HOTCHKIS & WILEY of HOTCHKIS & WILEY Capital Management LLC, Chuck Royce of Royce& Associates, Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Net sales for the three months ended June 30, 2010 were $289.5 million compared to $288.3 million in the three months ended June 30, 2009, an increase of $1.2 million, or 0.4%. The increase in net sales was primarily the result of lower price discounts and increased retail sales, partially offset by decisions to abandon unprofitable products, customers, and programs, resulting in lower sales volume.

Gross profit for the three months ended June 30, 2010 increased to $74.4 million compared to $61.6 million in the three months ended June 30, 2009. Gross margin for the three months ended June 30, 2010 increased to 25.7% compared to 21.4% in the three months ended June 30, 2009. The increases in gross profit and gross margin are primarily due to lower price discounts proportionate to sales, increased efficiencies in our supply chain, and improved capacity utilization, partially offset by lower sales.

Net sales for the six months ended June 30, 2010 were $611.9 million compared to $645.1 million in the six months ended June 30, 2009, a decrease of $33.3 million, or 5.2%. The decrease in net sales was primarily the result of continued weak retail conditions and decisions to abandon unprofitable products, customers, and programs, resulting in lower sales volume, and was partially offset by lower price discounts and increased retail sales.

Gross profit for the six months ended June 30, 2010 increased to $158.9 million compared to $142.0 million in the six months ended June 30, 2009. Gross margin for the six months ended June 30, 2010 increased to 26.0% compared to 22.0% in the six months ended June 30, 2009. The increases in gross profit and gross margin are primarily due to lower price discounts proportionate to sales, increased efficiencies in our supply chain, and improved capacity utilization, partially offset by lower sales.

Income tax benefit for the six months ended June 30, 2010 totaled $4.8 million compared to income tax expense of $1.3 million in the six months ended June 30, 2009. The increase in income tax benefit in the six months ended June 30, 2010 was driven by additional net operating loss carry backs created from contributions to our pension plans in the second quarter of 2010. These contributions allowed us to utilize remaining carry back capacity from previous tax years and increase our income tax refund receivable.

Cash and cash equivalents at June 30, 2010 totaled $102.8 million, compared to $83.9 million at December 31, 2009. Net cash provided by operating activities totaled $46.3 million in the six months ended June 30, 2010 compared with $35.5 million in the six months ended June 30, 2009. Increased earnings from operations, higher receipt of income tax refunds receivable, and lower payments of long-term incentive compensation contributed increased cash flow from operations in the six months ended June 30, 2010 as compared to the six months ended June 30, 2009, partially offset by lower cash generated from working capital. Net cash used in investing activities for the six months ended June 30, 2010 totaled $9.3 million compared with $3.8 million in the six months ended June 30, 2009. The increase in cash used in investing activities

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