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 JASPER, Ind., Oct. 12 /PRNewswire/ -- Kimball International (NASDAQ: KBALB) told share owners at the annual meeting today that sales and net income will increase in the fiscal first quarter ended Sept. 30, 1993, when compared to the same period last year.
 Douglas A. Habig, president and chief executive officer, said sales are expected to be up about 15 percent and operating net income is expected to increase almost 25 percent over last year's first quarter, excluding the effect of adopting FASB Statement 109 -- Accounting for Income Taxes. Operating earnings per share should approximate 43 cents before adding 5 cents for the adoption of the new FASB Statement.
 Habig said these estimates are based on preliminary figures. He said Kimball expects to release final results for the quarter in a couple of days.
 Habig noted that results in last year's first and second quarters were somewhat sub-par. He said the challenges to maintain favorable year-over-year comparisons will increase as the fiscal year progresses.
 The Lodging Group's sales were substantially higher and profit margins improved in the first quarter versus last year's depressed levels, according to Habig. He said the Lodging Group, in addition to supplying guest room furniture for new major hotels, is getting more replacement business as hotels refurbish. Refurbishments account for almost 80 percent of the hospitality furniture market and represent the growth segment.
 The Electronic Group's sales increased, but income was down slightly due in part to a shift to lower margined products within the group and a difficulty in passing on higher operating costs to customers. Habig said the company is pleased that in a recent survey of customers by a leading electronics industry publication, the Kimball Electronics Group was rated No. 1 in manufacturing quality, timely delivery and customer responsiveness.
 The Cabinet's and OEM Furniture Group had strong increases in sales and income versus last year's slow start. While TV cabinet sales have picked up, Habig said he wasn't certain this will be sustainable through the year. He said Kimball is expanding its presence in residential furniture by developing a line of solid wood bedroom furniture, called Traditions by Kimball. Preliminary market reaction has been very positive.
 The Office Furniture Group posted solid first quarter gains in both sales and income. Habig said the company expects continued steady growth in office furniture this year, with above-average growth in systems and mid-range furniture lines.
 Habig said expenses for Harpers will continue to be relatively high as the subsidiary relocates its operation from Torrance, Calif., to Post Falls, Idaho, along with continuing to expand its distribution eastward and further intensifying its new product development efforts. The new plant will be completed next summer.
 Although Piano Group sales were lower, the group posted breakeven for the quarter, largely because of strong contract business.
 International sales were off significantly while operating losses were flat in U.S. dollars. Habig said the restructuring efforts undertaken last year by the company's European operations have begun to reduce their overhead cost structures, and impacts on profitability will be seen as volume levels improve.
 Habig said Kimball is optimistic about fiscal 1994. He said sales are expected to advance 10-15 percent and net income will rebound and approach a new record. But he cautioned that assumes contract sales will hold up and that European market refocus and production realignment efforts move forward.
 The company's balance sheet remains strong, according to Habig. He said balance sheet liquidity will allow the company to weather periods of high capital expansion, such as it had the last two years and expects to have this year.
 In a report on the fiscal year ended June 30, 1993, James C. Thyen, senior executive vice president, chief financial and administrative officer and treasurer, reported that consolidated sales were a record $722,400,000 an increase of 17 percent from the prior year's $617,301,000. Net income, before a second quarter charge of $2,850,000 for restructuring the company's two European subsidiaries, was $33,433,000, a decrease of 11 percent from the year-earlier $37,400,000, excluding the previous year's non operating gain of $1,228,000. Including the restructuring charge, net income for fiscal 1993 was $30,583,000.
 At Kimball's annual meeting, share owners re-elected all 12 members of the Board of Directors. The directors are Thomas L. Habig, chairman; Douglas A. Habig, John B. Habig, James C. Thyen, Ronald J. Thyen, John T. Thyen, Anthony P. Habig, Gary P. Critser, Brian K. Habig, Leonard B. Marshall, Jr., Patricia H. Snyder and Jack R. Wentworth.
 -0- 10/12/93
 /CONTACT: Ken Sendelweck, assistant treasurer, of Kimball International, 812-482-1600/

CO: Kimball International ST: Indiana IN: HOU SU: ERP

LC-BM -- CL024 -- 1109 10/12/93 12:39 EDT
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Publication:PR Newswire
Date:Oct 12, 1993

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