Quaker Fabric records modest loss
Laurie Karzen -- Home Textiles Today, July 26, 2004
FALL RIVER, Mass. — Hampered by weaker sales, thinning margins and rising costs, decorative fabrics producer Quaker Fabric Corp. recorded a modest second quarter loss of $482,000, compared with a prior-year profit of $165,000.
Hobbled by weak U.S. demand — even as the company’s export business held steady — sales slipped by 1 percent, to $73.1 million from $73.9 million during the prior-year period. “The overall weakness in demand for upholstered furniture that negatively affected our first-quarter financial results continued to affect our financial performance during the second quarter,” said Larry Liebenow, Quaker president and CEO. “In addition, consumer demand for leather and suede furniture coverings remained strong, competing with the jacquard and plain woven fabrics Quaker produces.”
U.S. sales declined by 8 percent during the second quarter, and by 10 percent for the six months, offset by steady export sales and a surge in yarn sales, which almost tripled during the second quarter.
Average gross margin narrowed by 130 basis points, or 1.3 percentage points, to 18.3 percent from 19.6 percent a year ago. Gross margin dollars fell by 7.5 percent, to $13.4 million from $13.3 million.