Beaulieu of America has secured $230 million in refinancing to help the Dalton-based carpetmaker cope with the ongoing slump in carpet sales, President and CEO Ralph Boe announced Thursday.
The company had been in talks for some time to seal the deal, which will carry it through “the next several years,” Boe said.
“Given the climate in the industry and the economy, people were concerned with whether or not those refinancing capabilities are there,” Boe said. “These are people who have worked with us for years, so they recognize the cyclicality that exists in our industry, and fully understand the depression that exists in the housing market today.”
Carpet industry sales are down 40 percent from their peak levels in the mid-2000s, and Beaulieu workers took a 10 percent pay cut this year following companywide furloughs in 2010.
Beaulieu’s latest infusion of cash should be more than enough to carry it through 2012, which Boe expects to be another flat year. It’s too soon, he said, to predict when the market will turn around.
“Right now, we still don’t foresee that 2012 is going to be any different from where we’ve been here in the last few years,” Boe said. “The only thing that could change that would be some governmental relaxation of how banks are dealing with home loans that are underwater.”
With revenue expected to be flat, there aren’t plans for expansion, but the $230 million will give Beaulieu flexibility to be ready if demand picks up.
In the meantime, he said, executives are “making sure the company is being prudent about how we’re handling operations during these difficult times.”
Ellis Smith joined the Chattanooga Times Free Press in January 2010 as a business reporter. His beat includes the flooring industry, Chattem, Unum, Krystal, the automobile market, real estate and technology. Ellis is from Marietta, Ga., and has a bachelor’s degree in mass communication at the University of West Georgia. He previously worked at UTV-13 News, Carrollton, Ga., as a producer; at the The West Georgian, Carrollton, Ga., as editor; and at the Times-Georgian, Carrollton, ...