The Dixie Group Inc. reported Wednesday that net sales rose to $50.4 million in the first quarter of this year, up year-over-year from $47.6 million in 2009.
Losses from continuing operations declined sharply to $2.5 million or 20 cents per diluted share in the first quarter, down from $35.4 million or $2.90 per diluted share in first quarter of last year, according to the Chattanooga-based floorcovering company.
Dan Frierson, chairman and chief executive officer, attributed the company’s improving finances to a gradual recovery in the residential market, where Dixie has been pushing low-priced products that increased sales growth in dollars by 10 percent over and above the general market.
“The first quarter, which is usually our lowest from a seasonal standpoint, was an improvement over the same quarter of last year and our first favorable year-over-year comparison since the downturn began,” Mr. Frierson said.
Mr. Frierson noted that while the industry experienced its first year-over-year increase in unit sales since the third quarter of 2005, the carpet industry has still not experienced a yearly increase in dollar sales since the second quarter of 2006.
“The financial meltdown over the last year and half impacted the upper end markets we serve even more severely than the industry as a whole,” said Mr. Frierson, but added that “our first objective has been to return to profitability at the existing levels of business, and we’re well along there.”
Kemp Harr, publisher of Floor Focus magazine, said Dixie has responded adequately to market pressures to remain competitive in a tighter economy.
“Dixie’s made some big changes in the last couple years: they’ve right-sized, they’ve consolidated, they got out of lines that weren’t moving very well, and last year they introduced more products than they’ve introduced in years,” he said.
Dixie’s stock closed Wednesday at $5.02 per share, down 14 cents.