Dixie Group Inc. Reports Operating Results (10-Q)
Dixie Group Inc. is a leading carpet and rug manufacturer and supplier to higher-end residential and commercial customers serviced by Masland Carpets and Fabrica International to consumers through major retailers under the Bretlin Globaltex and Alliance Mills brands and to the factory-built housing and recreational vehicle markets through Carriage Carpets. Dixie's Candlewick Yarns serves specialty carpet yarn customers.(PR) Dixie Group Inc. has a market cap of $47.2 million; its shares were traded at around $3.74 with and P/S ratio of 0.1. Highlight of Business Operations: Expenses for the consolidation and organizational changes were $1.6 million in the first quarter of 2009, bringing the total costs for the cost reduction plan to $3.9 million. The first quarter costs included $1.0 million for facility consolidations and $600 thousand for severance expenses. The expenses to complete the cost reduction plan, excluding any expenses that may be incurred to exit a leased facility, are expected to be approximately $400 thousand.
Income (Loss) from Continuing Operations. The loss from continuing operations was $35.4 million, or $2.90 per diluted share in the first quarter of 2009, including $29.5 million, or $2.42 per diluted share of losses associated with the impairment of goodwill and consolidation and severance expenses, compared with income of $82 thousand, or $0.01 per diluted share, in the first quarter of 2008.
Net Income (Loss). Discontinued operations reflected a loss of $116 thousand, $0.01 per diluted share, in the first quarter of 2009, compared with a loss of $69 thousand, or $0.01 per diluted share, in the same period of 2008. Including discontinued operations, the net loss was $35.6 million, or $2.91 per diluted share, in the first quarter of 2009, compared with income of $13 thousand, or $0.00 per diluted share, for the same period of 2008.
During the three months ended March 28, 2009, we generated $11.1 million of funds through operating activities and $283 thousand from the sale of available-for-sale securities. These funds were primarily used to finance operations, invest $1.0 million in capital assets, reduce outstanding checks in excess of cash by $649 thousand and reduce debt by $9.6 million.
Working capital was reduced $14.2 million during the three month period ended March 28, 2009, principally as a result of lower levels of receivables and inventory. Receivables and inventories were reduced $9.8 million and $9.3 million, respectively, and accounts payable and accrued expenses declined by $2.7 million. Other current assets increased $2.2 million, principally as the result of seasonally higher prepaid expenses. The lower level of receivables reflected reductions of $3.2 million in trade receivables, $2.9 million in income tax receivables and $3.7 million in other receivables.
Capital expenditures for the three-months ended March 28, 2009 were $1.0 million while depreciation and amortization was $3.6 million. We expect capital expenditures to be approximately $7.0 million in fiscal 2009, while depreciation and amortization is expected to be approximately $14.0 million. Approximately $3.2 million of the anticipated 2009 capital expenditures will be for new manufacturing technology, with the remainder being expenditures to maintain our facilities and equipment.
Read the The complete ReportDXYN is in the portfolios of Arnold Van Den Berg of Century Management.