Craftmade International Reports Fiscal 2011 First Quarter Results

COPPELL, Texas, Nov. 23, 2010 /PRNewswire-FirstCall/ -- Craftmade International, Inc. (OTCQX: CRFT) today reported the following results for its fiscal 2011 first quarter ended September 30, 2010:

First Quarter 2011 Consolidated Results

Net loss for the quarter ended September 30, 2010 was $712,000, compared to net loss of $595,000 for the quarter ended September 30, 2009.  On a fully diluted basis, net loss per share was $0.12 for the quarter ended September 30, 2010, compared to a net loss of $0.10 for the same period of 2009.  For purposes of calculating loss per share, weighted average diluted shares outstanding for the first quarter were 5,705,000, versus 5,705,000 for the 2009 first quarter. There are also 50,000 shares of issued but unvested restricted stock which are not included for purposes of calculating the Company's loss per share.

The first quarter represents the off-season for many of the Company's products, and typically represents the lowest sales and profit quarter of the annual cycle.

Net sales for the Company increased by $353,000 to $21,401,000 for the quarter ended September 30, 2010, up 2% from $21,048,000 for the quarter ended September 30, 2009. The increase is due to higher sales in the Specialty segment and somewhat offset by lower sales in the Mass segments.

Chief Executive Officer J. Marcus Scrudder commented, "Our first quarter results were generally in line with our quarterly results for the same period last year. While we are encouraged by the growth in the Specialty segment, these quarterly results were impacted by the overall housing market and the seasonal nature of our outdoor patio furniture business.  Despite market conditions, we remain focused on growing our market share and controlling costs."

Gross Profit; Selling, General and Administrative ("SG&A") Expense and Interest Expense

Gross profit as a percentage of net sales was 25.5% for the quarter ended September 30, 2010, down from 27.6% for the quarter ended September 30, 2009, primarily due to higher off-season costs in the furniture segment.

Total selling, general and administrative ("SG&A") expenses of the Company decreased $177,000 to $5,699,000 or 26.6% of net sales for the quarter ended September 30, 2010, from $5,876,000 or 27.9% of net sales for the same period last year. These savings are related to ongoing cost cutting efforts across the business, including the delisting and deregistration of the Company's stock in fiscal 2010. Savings were partially offset by higher advertising expense for the quarter, and higher claims on the self-insured portion of the Company's group insurance.

Net income attributable to noncontrolling interest was $206,000 for the quarter ended September 30, 2010, down slightly from $218,000 for the same period in the previous year.

First Quarter 2011 Segment Results

Net sales from the Specialty segment were $15,545,000 for the quarter ended September 30, 2010, up 8% compared to $14,394,000 for the quarter ended September 30, 2009, driven by increases in both furniture and fan/lighting product lines.

Net sales of the Mass segment were $5,856,000 for the quarter ended September 30, 2010, a decrease of 12% from $6,654,000 for the quarter ended September 30, 2009, primarily due to lower shipments of Mass furniture during the off season.

"We continue to focus on our strategy for growth, combined with ongoing cost reduction efforts. This will enable us to remain competitive in a difficult economic environment, and achieve long-term profitability as economic conditions improve," concluded Mr. Scrudder.

Founded in 1985, Craftmade International, Inc. is engaged in the design, manufacturing, distribution and marketing of a broad range of home decor products, including proprietary ceiling fans, lighting products and outdoor furniture.  The Company distributes its premium products through a network of independent showrooms and mass retail customers through its headquarters and distribution facility in Coppell, Texas and manufacturing plant in Owosso, Michigan.  

More information about Craftmade International, Inc. can be found at www.craftmade.com.

Various statements in this Press Release or incorporated by reference herein, in future filings with the SEC, in press releases, and in oral statements made by or with the approval of authorized personnel constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current expectations and are indicated by words or phrases such as "may," "will," "should," "could," "might," "expects," "plans," "anticipates," "believes," "estimates," "projects," "predicts," "forecasts," "intends," "potential," "continue," and similar words or phrases and involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from the future results, performance or achievements expressed in or implied by such forward-looking statements.  These forward-looking statements include statements or predictions regarding among other items: revenues and profits; gross margin; customer concentration; customer buying patterns; sales and marketing expenses; general and administrative expenses; pricing and cost reduction activities; income tax provision and effective tax rate; realization of deferred tax assets; liquidity and sufficiency of existing cash, cash equivalents, and investments for near-term requirements; purchase commitments; product development and transitions; competition and competing technology; outcomes of pending or threatened litigation; and financial condition and results of operations as a result of recent accounting pronouncements.  These forward-looking statements are based largely on expectations and judgments and are subject to a number of risks and uncertainties, many of which are beyond our control.  Significant factors that cause our actual results to differ materially from our expectations are described in our Form 10-K under the heading of "Risk Factors."  We undertake no obligation to publicly update or revise these Risk Factors or any forward-looking statements, whether as a result of new information, future events or otherwise.

SOURCE Craftmade International, Inc.