Five vendors post revenue gains in first quarter
By Janice Chamberlain -- Kids Today, 7/1/2005
The first quarter of 2005 turned out to be to be a fairly even quarter in terms of revenue for the nine companies on this edition of the Kids Today vendor scorecard. Five of the nine managed revenue increases — including a whopping 57.4% increase for RC2 — and only one of the four that recorded a revenue decline had a double-digit percentage decrease.
Compared with first quarter 2004 revenue, the largest dollar increase, $74.5 million, belonged to Dorel, bringing its revenue total in the latest quarter to $465.6 million. Coming in second was the $35.2 million gain posted by RC2 to finish the quarter with revenues of $96.5 million. Not far behind was the $33.4 million gain posted by La-Z-Boy, which improved its revenues by 6.3% to $565.6 million from $532.2 million in the comparable year-earlier period.
Coming in second in percentage revenue increase was Dorel's 19%. Stanley Furniture's 16% gain to finish the latest quarter with revenues of $83 million, up from $71.5 million a year earlier, achieved third-place honors.
The largest dollar decline in revenues belonged to Furniture Brands International, which dropped $36 million from a year ago to record revenues of $641.6 million. Despite the decline in revenues, FBI is still the largest revenue-producing company on the list.
Collectively, the nine companies recorded revenues of $2.2 billion for the first quarter of 2005, up 4.7% over revenues of $2.1 billion for the comparable 2004 period.
Perhaps the biggest surprise was that eight of the nine suppliers on the scorecard achieved earnings improvements, either adding to their coffers or at least losing less than in the comparable 2004 period. The largest percentage increase in net profits was the 166.1% surge reported by RC2, which saw income rise from $2.9 million a year ago to $7.8 million in the latest quarter.
Second place in net income percentage growth went to furniture maker and importer Chromcraft Revington, which recorded earnings of $2.3 million in the 2005 period, up 51.1% from $1.5 million a year ago.
Not far behind was the 40.2% increased in net income recorded by Dorel, as the company posted profits of $27.2 million in the latest quarter, up from $19.4 million in the year-earlier period.
Ethan Allen's reported net earnings dropped 22.5% to $17.9 million in the latest quarter from $23.1 million in the first quarter of 2004. Martha Stewart Living Omnimedia was the only company on the scorecard to report a net loss for the period — $19.2 million — but that was better than the comparable 2004 quarter's loss of $19.5 million.
Aggregate profits for the suppliers on the vendor scorecard skyrocketed 250.8% to $89.7 million from $25.6 million in the first quarter of 2004.
As a group, gross margin percentage slipped 0.5% percentage points. The four largest companies — Furniture Brands, La-Z-Boy, Dorel and Ethan Allen — all reported percentage point declines in gross margin.
Martha Stewart Living reported the largest percentage point increase in gross margin — 4.1%. Joining the leader in percentage point gains were Bassett Furniture, Chromcraft Revington, Stanley Furniture and RC2.
Return-on-revenues varied, but overall the companies saw their ROR score increase from 1.2% a year ago to 4% in the latest quarter.
RC2's 8.1% ROR led the way in the latest quarter, with Ethan Allen's 7.8% nipping at its heels. Trailing the pack was Martha Stewart Living, which posted an ROR score of a negative 49.6%.
Kids Today's first-quarter vendor scorecard is based on the financial results of nine publicly traded companies with fiscal quarters ending from Feb. 26 to April 30, 2005. At press time, neither Culp or Crown Crafts had reported out their first quarter results.
Dan River has emerged from bankruptcy, but no longer releases its quarterly earnings.
| 2005 GM% | 2004 GM% | Pct. Pt chnge | |
| Martha Stewart Omnimedia1 | 39.1% | 35.0% | 4.1% |
| Bassett Furniture | 26.4 | 25.7 | 0.7 |
| Chromcraft Revington | 23.6 | 23.0 | 0.6 |
| Stanley Furniture | 24.7 | 24.1 | 0.6 |
| RC2 | 50.9 | 50.6 | 0.3 |
| La-Z-Boy | 23.1 | 23.6 | -0.5 |
| Furniture Brands Intl. | 25.4 | 26.2 | -0.8 |
| Dorel | 23.4 | 24.3 | -0.9 |
| Ethan Allen | 47.8 | 48.8 | -1.0 |
| Composite | 28.0% | 28.5% | -0.5% |
| 1. Cost of goods sold represents production, distribution and editorial costs. Source: Company reports and Kids Today market research |
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| Qtr. | revenue in millions | net income in millions | return on revenues | ||||||
| Retailer | ended | 2005 | 2004 | change | 2005 | 2004 | Change | 2005 | 2004 |
| Furniture Brands Intl. | 3/31 | $641.6 | $677.6 | -5.3% | $24.8 | $33.2 | -25.4% | 3.9 | 4.9 |
| La-Z-Boy1 | 4/30 | 565.6 | 532.2 | 6.3 | 20.82 | (42.1)3 | — | 3.7 | -7.9 |
| Dorel | 3/31 | 465.64 | 391.14 | 19.0 | 27.2 | 19.4 | 40.2 | 5.8 | 5.0 |
| Ethan Allen5 | 3/31 | 231.2 | 244.6 | -5.5 | 17.9 | 23.1 | -22.5 | 7.8 | 9.5 |
| RC2 | 3/31 | 96.5 | 61.3 | 57.4 | 7.8 | 2.9 | 166.1 | 8.1 | 4.8 |
| Stanley Furniture | 4/30 | 83.0 | 71.5 | 16.0 | 5.8 | 4.6 | 25.0 | 6.9 | 6.4 |
| Bassett Furniture | 2/26 | 80.8 | 76.6 | 5.5 | 2.4 | 2.3 | 1.5 | 2.9 | 3.0 |
| Chromcraft Revington | 4/2 | 44.7 | 46.5 | -3.9 | 2.3 | 1.5 | 51.1 | 5.1 | 3.2 |
| Martha Stewart Omnimedia | 3/31 | 38.7 | 44.5 | -13.1 | (19.2)6 | (19.5)6 | — | -49.6 | -43.8 |
| TOTAL | $2,247.4 | $2,145.8 | 4.7% | $89.7 | $25.6 | 250.8% | 4.0% | 1.2% | |
| Note: Figures in parentheses are losses or declines. 1. The 2005 quarter is 14 weeks; the 2004 quarter is 13 weeks. 2. Includes a $3.1 million pretax restructuring credit, $1 million in net income from discontinued operations and a $1.4 million extraordinary gain. 3. Includes a $948,000 pretax restructuring charge, a $1.5 million income tax benefit, $25,000 in net income from discontinued operations and a $8.3 million extraordinary charge, the cumulative effect of an accounting change. 4. Includes licensing and commission income of $6.3 million in the 2005 quarter and $3.4 million in the 2004 quarter. 5. 2004 figures are restated. 6. Includes net losses from discontinued operations of $132,000 in the 2005 quarter and $161,000 in the 2004 quarter. Source: Company reports and Kids Today market research |
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