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Bassett Furniture Reports Increased Earnings for Second Quarter and First Half of Fiscal 1999 Business Wire - June 29, 1999 18:50 BASSETT, Va.--(BUSINESS WIRE)--June 29, 1999-- Gross Margin Improvement and Higher Sales Drive Results Bassett Furniture Industries, Inc. today announced increased revenue and earnings for the second quarter and first half of fiscal 1999. The increases resulted from a combination of sales growth, gross margin improvement and investment earnings. Earnings per share increased 5.3% for the second quarter and 5.6% for the six-month period ended May 29, 1999. Diluted earnings per share were $.40 for the quarter and $.75 for the first half, compared with $.38 and $.71, respectively, for the year-ago periods. All comparisons are with proforma fiscal 1998 earnings excluding charges for restructuring and discontinued operations. Reported diluted earnings per share were $.30 and $.56, respectively for the year ago periods. Commenting on the results, Paul Fulton, Chairman, and Chief Executive Officer, said, "We are pleased with these results, which are in line with our plan. Two trends that are especially encouraging are growth in sales of Bassett branded furniture and the increase in gross margin. Sales were up 5.4% in the second quarter and 3.5% in the first half. Gross Margin - a major area of focus for Bassett - was 21.7% for the quarter and 20.7% for the first half, an improvement of 1.7 percentage points for the quarter and 1.1 percentage points for the first half." The gross margin improvement resulted from a better product mix, price increases, and increased levels of production, with particularly strong performance in the wood division. A new table plant, which will open in the fall of this year, will further improve manufacturing productivity. The operating margin was 3.8%, the same as last year, reflecting continued spending to build the brand and the organization, start-up costs of the new table plant and the growing retail operation, and operating losses on the bedding division which was divested as of April 30, 1999. Net sales for the quarter were $103.7 million, compared with $98.3 million in 1998; first half sales were $203.5 million in 1999 and $196.7 million in 1998. The sales improvement reflects the expansion of the Bassett Furniture Direct (BFD) retail program from 27 stores in mid-1998 to 44 stores at the end of May 1999. BFD sales represented 19% of total sales in 1999, up from 12% in 1998. Plans call for a total of 55 to 60 BFD stores open by the end of 1999. Bassett also announced that it is continuing its active share repurchase program. As of May 31, approximately 32% of the current $40 million share repurchase program had been completed. Also today, Bassett's board of directors declared a regular quarterly dividend of $.20 per share payable September 1, 1999 to shareholders of record August 17, 1999. Bassett Furniture Industries, Inc., based in Bassett, VA, is a manufacturer and marketer of branded home furnishings. The company operates 15 plants in five states and operates or licenses 44 Bassett Furniture Direct stores nationwide. The company's stock is traded on the NASDAQ market under the symbol BSET. More information about Bassett is available on the Internet at http:\\www.bassettfurniture.com. This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations and business of Bassett Furniture Industries, Inc. These forward-looking statements involve certain risks and uncertainties. No assurance can be given that any such matters will be realized. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following possibilities: (I) competitive conditions in the industry in which Bassett operates; and (II) general economic conditions that are less favorable than expected. | ||||||||||||
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