Ron Klosterman, president and CEO of Flexsteel Industries Inc., accepted Furniture Today’s “2009 Supplier of the Year” award for the company during the magazine’s 13th annual Leadership Conference in Naples, Fla. last month.
Upon accepting the award, Klosterman thanked Furniture Today and the industry. He said the honor was validation for the 1,500-plus Flexsteel employees who “come to work every day and provide great product and service to all the dealers we serve.” In addition, Klosterman thanked the retailers who work with Flexsteel and case goods division Wynwood, saying: “The independent dealer has always been the backbone of our company.”
Flexsteel, which provides furniture to the RV industry and other markets, was cited as a cornerstone of the furniture industry and well-deserving of the award, according to Furniture Today’s editor-in-chief, Ray Allegrezza, when the award was announced earlier. He also called Flexsteel an “American success story.”
“(Flexsteel) which makes seating products for virtually every application, has more than a 100-year-history as a credible, reliable and innovative supplier,” said Allegrezza.
The publicly traded company sells its well-known furniture across the globe and operates seven U.S. manufacturing plants and two permanent showrooms.
Further information on Flexsteel Industries Inc. can be accessed at http://flexsteel.com.
Flexsteel Industries Inc. Wednesday (Aug. 19) reported results of operations for its fourth quarter and fiscal year ended June 30.
The Dubuque, Iowa-based furniture supplier to the RV industry and other markets reported net sales of $74.6 million compared to the prior year quarter of $100.6 million, a decrease of 25.9%. The company reported net income for the current quarter of $800,000 compared to net income of $300,000 in the prior year quarter.
Net sales for the fiscal year ended June 30 were $324.2 million compared to $405.7 million in the prior fiscal year, a decrease of 20.1%. The company reported a net loss for the current fiscal year of $1.5 million compared to net income of $4.2 million in the prior year. On a pre-tax basis the reported loss of $2.6 million includes approximately $2.6 million related to facility consolidation and employee separation costs, reflecting near break-even results from continuing operations.
For the quarter ended June 30 net sales to the RV industry were $2.8 million compared to $11.6 million in the prior year quarter, a decrease of 75.9%.
For the fiscal year recreational vehicle net sales were $16.2 million, a decrease of 71.1% from net sales of $56.1 million for the year ended June 30, 2008.
In a release, the company stated, “We believe that the consolidation of manufacturing operations and work force reductions that the company completed during the fiscal year have brought production capacity and fixed overhead in line with current and expected demand for our products. Companywide employment has been reduced approximately 30% over the past year through plant closures and work force reductions related to business conditions.
“The recreational vehicle industry continues to be the hardest hit product category with the initial impact of high fuel costs compounded by credit tightening and lack of consumer confidence in the economy as a whole. Recreational vehicle industry published data indicates that motorhome unit sales, the sector that encompasses the majority of our sales, are down nearly 80%.
“We are not anticipating significant improvements in market conditions at this time, and are managing our business on that basis.”
The company expects current business conditions to persist for the remainder of calendar year 2009.
Flexsteel Industries Inc. has been recognized as the best of the nation’s furniture suppliers by an industry publication — an award that comes on the heels of company layoffs and sales declines in the midst of a struggling furniture market, according to the Dubuque (Iowa) Telegraph Herald.
The Dubuque-based furniture maker was named Supplier of the Year by Furniture Today magazine. The award, Flexsteel spokesman Justin Mills said, is significant since the publication is highly regarded among manufacturers and retailers in the industry.
Flexsteel received word about the recognition late last week, and the award will be presented in December at a conference in Naples, Fla.
“This is kind of a landmark for Flexsteel, it really puts us on the map,” said Mills, who said the publication also ranked Flexsteel as ninth among manufacturers worldwide in recent years as residential sales have grown.
Flexsteel was recognized in large part for company longevity, as it has been in existence for more than a century. Flexsteel was founded in Minnesota before moving to Dubuque in the early 1900s.
“We’ve been around 116 years and have one of the strongest balance sheets in the industry. So retailers are recognizing we’re a credible supplier,” Mills said.
The award was cast in the context of the current economic downturn, as the publication looked to recognize companies staying competitive. Mills said this served as a reaffirmation of the company’s efforts.
In the article, Furniture Today Editor-in-Chief Ray Allegrezza called Flexsteel an “American success story.”
“The company, which makes seating products for virtually every application, has more than a 100-year history as a credible, reliable and innovative supplier,” he said.
But the past year has unquestionably been a challenging one for Flexsteel.
Last quarter, Flexsteel reported net sales of $73.6 million for the quarter — 25% lower than the year before.
Ron Klosterman, Flexsteel chairman and CEO, said the work force was slashed by more than 30% over the year.
Many of those reductions came from the closure of Flexsteel’s New Paris, Ind., recreational vehicle seating production plant and ending manufacturing operations at a Lancaster, Pa., facility last fall.
But there have been job cuts locally as well, a series of reductions at the Dubuque flagship factory trimmed the staff to less than 150 and completely eliminated the second shift.
Mills said Flexsteel now employs 1,450 employees companywide.
“We hope that’s all behind us. It’s not been an easy journey to get where we are today,” he said. “Until this economy turns around that’s all we can do is be ready, be prepared and be well equipped.”
Mills said he didn’t want to speculate on the role the troubled recreational vehicle business will play in the future.
“It’s tough to say,” he said, adding that a turnaround on recreational vehicles won’t happen until the original equipment manufacturers rebound.
The furniture industry in general has been facing a perfect storm of rising material costs, the credit crunch and a generally poor housing market.
“Some of these manufacturers can’t balance source production versus domestic production and they get in big trouble. They’re taking out millions in loans just to stay in business,” said Mills, who said Flexsteel officials are hoping for a retail bounce back this fall.
“The bottom line is we’re well-positioned and well-equipped to handle the demand when it does turn around.”
Flexsteel Industries Inc. reported Tuesday (April 21) net sales for the quarter ended March 31 of $73.6 million compared to the prior year quarter of $98.1 million, a decrease of 25.0%.
The Dubuque, Iowa-based RV furniture manufacturer also reported a net loss for the quarter of $1.9 million compared to net income of $800,000 in the prior year quarter.
Net sales for the nine months ended March 31 were $249.6 million compared to $305.0 million in the prior year nine-month period, a decrease of 18.2%. The company reported a net loss for the current nine-month period of $2.3 million compared to net income of $3.9 million in the prior year period.
During the the first three quarters of the current fiscal year, the company recorded pre-tax charges of approximately $2.4 million related to facility consolidation and employee separation costs and a $1.7 million inventory write-down.
For the quarter ended March 31 net sales to the RV industry were $2.5 million compared to $14.0 million in the prior year quarter, a decrease of 82%. Net sales to the RV industry were $13.4 million for the nine months ended March 31, a decrease of 70% from net sales of $44.5 million for the year-earlier period.
The consolidation of manufacturing operations that the company announced on Sept. 10 was substantially completed as of Dec. 31. However, workforce reductions have taken place at other facilities as the company continues to adjust operations to bring production capacity in line with current and expected demand for its products. Companywide employment has been reduced approximately 30% over the past year.
“Demand for our products is dependent on factors such as consumer confidence, affordable housing, reasonably attainable financing and an economy with low levels of unemployment and high levels of disposable income,” the company stated in its release. “These factors are all currently in poor positions, and indications are that they will remain that way in the near-term. We are not anticipating significant improvements in market conditions at this time, and are managing our business on that basis.”
“While we expect that current business conditions will persist for the remainder of calendar year 2009, we remain optimistic that our strategy of a wide range of quality product offerings and price points to the residential, recreational vehicle and commercial markets combined with our conservative approach to business will be rewarded over the longer-term,” the company concluded.
Wall Street is soaring, propelling the Dow Jones industrials up nearly 500 points, as investors get the good news they want on the economy’s biggest problems: banks and housing.
Investors have reignited a two-week rally, cheering the government’s plan to help banks remove bad assets from their books. They’re also pleased with a report showing a surprising increase in existing home sales last month, according to Associated Press.
The stocks of public companies engaged in the RV industry that are traded on major markets rode the rally, enjoying their best day in months.
Winnebago Industries Inc. rose 15.9%, Thor Industries Inc. rose 13.5%, Drew Industries Inc. rose 16.9%, Skyline Corp. rose 10%, Patrick Industries Inc. rose 5.5%, Spartan Motors Inc. rose 8.3% and Flexsteel Industries Inc. rose 1.4%.
Equity LifeStyle Properties Inc., a real estate investment trust that serves the campground industry, rose a whopping $5.50 a share to close up 14.9%.
The Dow closed up more than 497 points, its best day in more than four months.
The Treasury Department’s bad asset cleanup program would tap money from the government’s $700 billion financial rescue fund and also involve help from the Federal Reserve, the Federal Deposit Insurance Corp. and the participation of private investors. The housing report, meanwhile, is overwhelmingly positive because it’s a sign that the glut in homes for sale may be easing.