Michael Knell
\nHigher particleboard costs hurt margins<\/p>\n
MONTREAL \u00e2\u20ac\u201d Lower home furnishings shipments and the rising cost of particleboard helped drag down sales and earnings for Dorel Inds. in the first quarter.<\/p>\n
<\/p>\n
The consumer goods giant\u00e2\u20ac\u2122s revenue of $451 million was down 4.4% from the same period last year and earnings fell 11.1% to $24.2 million.<\/p>\n
Revenue in the home furnishings segment was down 8% to $133.7 million while earnings from operations decreased 57.3% to $4.6 million. Sales declined by 7% in Dorel\u00e2\u20ac\u2122s recreational and leisure segment and by 1.4% in the juvenile segment.
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\n\u00e2\u20ac\u0153The aggressive plan announced last year to revitalize Dorel\u00e2\u20ac\u2122s ready-to-assemble furniture division is on track and important progress has been made on several fronts,\u00e2\u20ac\u009d
\nsaid Martin Schwartz, Dorel president and CEO.<\/p>\n
\u00e2\u20ac\u0153A greatly enhanced new product development capability has resulted in an exciting flow of new products; Ameriwood has a wider positioning in its markets and has added new customers; sourcing has increased significantly from China and overheads have been reduced due to operational improvements at the division\u00e2\u20ac\u2122s domestic factories,\u00e2\u20ac\u009d he said.<\/p>\n
Sales of RTA furniture, however, declined by $20 million or 27.6% because of lower shipments to mass merchants. Substantial new orders came in but not all could be filled, Schwartz said.<\/p>\n
\u00e2\u20ac\u0153This demand was above expectations and beyond the immediate capabilities of the three remaining RTA furniture plants. An insufficient level of finished goods inventory coupled with the ongoing integration of the closed Wright City (Mo.) plant resulted in orders being either cancelled or delayed into the second quarter,\u00e2\u20ac\u009d he said.<\/p>\n
The situation \u00e2\u20ac\u0153substantially improved near the end of March,\u00e2\u20ac\u009d he added.<\/p>\n
Dorel\u00e2\u20ac\u2122s Cosco Home & Office division had a sales decline of 8% but a better mix of products resulted in higher gross margins. \u00e2\u20ac\u0153Business in this division is robust and a solid year is expected,\u00e2\u20ac\u009d Schwartz said.<\/p>\n
He added that because of a continued rise in the price of particleboard, Dorel plans to raise its prices later this year. But until those increases take effect, he said, the company doesn\u00e2\u20ac\u2122t expect any material improvement in RTA furniture margins.<\/p>\n","protected":false},"excerpt":{"rendered":"
Michael Knell Higher particleboard costs hurt margins MONTREAL \u00e2\u20ac\u201d Lower home furnishings shipments and the rising cost of particleboard helped drag down sales and earnings for Dorel Inds. in the first quarter. The consumer goods giant\u00e2\u20ac\u2122s revenue of $451 million was down 4.4% from the same period last year and earnings fell 11.1% to $24.2 […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":["post-661","post","type-post","status-publish","format-standard","hentry","category-furniture-world-news"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/posts\/661","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/comments?post=661"}],"version-history":[{"count":0,"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/posts\/661\/revisions"}],"wp:attachment":[{"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/media?parent=661"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/categories?post=661"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/indonesia-furniture.com\/articles\/wp-json\/wp\/v2\/tags?post=661"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}