Crown Crafts Dodges Some Headwinds in Q4
July 25, 2013,
Net income for the quarter, ended March 31, was fl at to last year's same period -- $1.9 million, or $0.19 per diluted share.
Net sales, however, declined 4.8% to $23.6 million, compared with $24.8 million a year ago.
The best news stemmed from the full-year's net income, which reached $5.1 million, or $0.52 per diluted share -- the company's highest rate since fiscal 2002, excluding an after-tax gain on debt restructuring of $3.7 million in fiscal 2007 and a $4.2 million income tax benefit in fi scal 2006.
By comparison, fiscal 2012's net income was $5.0 million, or $0.52 per diluted share.
Year-to-date net sales took an 8.1% hit, declining to $78.4 million, compared to $85.3 million in 2012, as a result of the discontinuance of an unprofitable private label infant bedding program, the company explained. Additionally, both the fourth quarter and full year were impacted negatively by the shift of a modular program's shipment for a major customer from the first quarter of fiscal 2013 into the fourth quarter of fiscal 2012. The decreased birth rate and soft retail environment also contributed to the declines in net sales.
"While market headwinds presented many challenges for our industry in fiscal 2013, we were able to make the necessary adjustments and achieve a historic level of profitability," said E. Randall Chestnut, chairman, president and ceo.
Looking ahead, he added the company is seeing continued benefits from the realignment of its cost structure, the redesign of products to reduce Crown Crafts' dependence on high-cost raw materials, and the discontinuance of an unprofitable private label infant bedding program.
"In addition, the overall strength of our products has allowed us to adjust pricing to recover from the record-high cotton prices that peaked in fiscal 2012," he summed.