LADD EXPECTS FOURTH QUARTER LOSS, SUSPENDS DIVIDEND
LADD EXPECTS FOURTH QUARTER LOSS, SUSPENDS DIVIDEND HIGH POINT, N.C., Jan. 16 /PRNewswire/ -- LADD Furniture, Inc.
(NASDAQ-NMS: LADF) chairman Richard R. Allen said today the company is expecting to report a significant loss for the fourth quarter of fiscal 1991, ended Dec. 28, 1991. Allen said the company significantly increased its reserve for bad debts during the fourth quarter, in light of continuing weakness in the furniture retailing sector. He said: "Additionally, in response to the ongoing U.S. furniture industry recession during the final three months of 1991, LADD scheduled considerable plant downtime to control inventory levels, which negatively impacted margins during the quarter. The company also accrued severance and early retirement pension expenses relating to cost and overhead reduction actions taken by several LADD Operating companies during the fourth quarter and wrote off the unamortized balance of
acquisition financing costs." Allen said LADD will report its 1991 fourth quarter and full year results during the first week in February, and estimated that the fourth quarter loss will be in the range of $.55-$.60 per share.
"While there has been some improvement in business recently," Allen said, "we expect the domestic furniture industry to show very slow recovery in early 1992, as a result of current low levels of U.S. consumer confidence. Recent sharp declines in U.S. interest rates should eventually prove very stimulative for the American economy in general and furniture demand in particular, but consumers will most likely defer making major durable goods purchases such as furniture for several months or more. With these factors in mind, LADD's directors voted today to temporarily suspend the company's cash dividend." He added: "It is our intention to reinstitute a cash dividend payment at the earliest possible time, consistent with industry conditions and LADD's earnings levels." He concluded: "Management's primary near-term focus is on returning LADD to profitability -- even if sales remain at current levels. We are taking numerous actions to accomplish this, including reduced staffing levels, aggressive cost-reduction programs and careful asset and inventory management." LADD's most recent quarterly cash dividend was $.03 per share, paid on Nov. 15, 1991, Allen noted. Headquartered in High Point, N.C., LADD is one of the largest U.S. producers of residential and contract furniture, marketing its broad range of wood, upholstered and metal furniture under the major brand names American Drew, American of Martinsville, Barclay, Brown Jordan, Clayton Marcus, Daystrom, Design Horizons, Lea Industries and Pennsylvania House. LADD also owns and operates two support companies, Lea Lumber & Plywood and LADD Transportation and its stock is traded on the over-the-counter National Market System under the NASDAQ symbol LADF. -0- 1/16/92 /CONTACT: John J. Ong, LADD Furniture, Inc., 919-888-6353/ (LADF) CO: LADD Furniture, Inc. ST: North Carolina IN: REA SU: ERN DIV
CM -- CH004 -- 0444 01/16/92 11:01 EST
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|Date:||Jan 16, 1992|
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