Cone rebound led by denim business
By Don Hogsett -- Home Textiles Today, 2/12/2001 2:14:00 PM
GREENSBORO, N.C. — With sales rebounding in its core denim business, and margins improving along with sales, Cone Mills Inc. staged a modest turnaround during the fourth-quarter, posting a small operating profit of $1.1 million, compared with a year-before loss of $3.8 million.
But weighed down by the cost of closing a home fashions printing plant, a total of $38.8 million, the diversified textiles producer generated a net loss of $28.0 million, compared with a smaller year-before loss of $4.9 million.
Lifted by growing strength in its big denim business, Cone sales climbed higher by 8.6 percent, to $149.2 million from $137.4 million last year. Denim sales improved by 16.8 percent, to $116.9 million from $100.1 million. But the company's home-related businesses remained weak, each posting a drop in sales.
Losing some ground after making picking ups team earlier in the year, decorative fabric sales were off by 4.3 percent, to $18.1 million from $18.9 million last year. But buoyed by an earlier rebound, decorative fabric sales for all of last year climbed by 6.0 percent, to $77.3 million from $72.9 million. And still reeling from the broad slowdown in the print market, Cone's commission printing business declined by 18.6 percent in the closing quarter, to $17.9 million from $22.0 million last year.
Giving a lift to the bottom line, average gross margin improved by 310 basis points, to 8.8 percent from 5.7 percent a year ago. Combined with the improvement in sales, that drove gross margin dollars higher by 67.6 percent, to $13.2 million form $7.9 million.
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