Stanley Furniture Announces Record First Quarter Sales and Earnings
Furniture World Magazine
Stanley Furniture Company, Inc. reported record sales and earnings for the first quarter of 2005. Both sales and earnings modestly exceeded the high end of management's previous guidance provided in early February 2005.
Net sales of $83.0 million increased 16.0% and earnings per share grew 21.1% to $.86 from the first quarter of last year. This marks the twelfth consecutive quarter of sales growth and the sixth consecutive quarter of double digit sales gains over the comparable prior year quarter.
Operating income rose to $9.4 million, or 11.3% of net sales, in the first quarter of 2005 from $7.8 million, or 10.9% of net sales, in the first quarter of 2004. Higher sales, increased production levels at the Company's domestic facilities, although at a slower growth rate than sales due to the expansion of sourced items, and operating efficiencies drove the improvement. These improvements were partially offset by inflation in raw materials, compensation costs, energy and freight costs, increased warehouse expense and tariffs imposed on wooden bedroom furniture imported from China.
Strong cash flow in the first quarter was used to purchase $1.9 million of the Company's common stock, pay cash dividends of $778,000 and increase the Company's cash on hand $9.6 million. Approximately $8.3 million remains authorized by the Company's Board of Directors to repurchase shares of the Company's common stock. At April 2, 2005, the Company was in a net cash position with total debt outstanding of $15.7 million and cash on hand of $17.3 million.
"We are pleased to report another quarter of significant progress," commented Jeffrey R. Scheffer, president and chief executive officer. For the most recent four quarters our sales have increased 15.6% from the previous four quarter period. "We believe market share gains are driving our sales growth. Blending efficient domestic manufacturing in our highly focused facilities with intelligent outsourcing of certain component parts and finished goods has allowed us to improve the styling and value of our products. Combining this with our culture and reputation for high quality and fast delivery differentiates us from our competition. We enter the second quarter with considerable momentum and anticipate 2005 to be another good year."