Dixie Group Inc (DXYN) 10-Q Quarterly Report August 2022

Highlights from First Quarter 2022 Results (all comparisons are to the prior year first quarter, as adjusted for discontinued operations, unless stated otherwise):

•Net sales from continuing operations increased over the prior year by $4.8 million or 6.6%

•Secured $11 million in long term property refinancing at a fixed interest rate of 3.81%

•Strong order activity throughout the quarter

DALTON, GEORGIA (May 11, 2022)-- The Dixie Group, Inc. (NASDAQ: DXYN) today reported financial results for the quarter ended March 26, 2022. For the first quarter of 2022, the Company had net sales from continuing operations of $77,575,000 and a net loss of $3,357,000 or $0.22 per diluted share. In the first quarter of 2021, as adjusted to reflect the commercial business as discontinued operations, net sales from continuing operations were $72,747,000 and the net loss was $2,028,000 or $0.14 per diluted share.

Commenting on the results, Daniel K. Frierson, Chairman and Chief Executive Officer, said, “During the first quarter of 2022, our net sales increased 6.6% compared with the first quarter of 2021. Order entry surpassed prior year throughout the quarter with the highest growth occurring within our Masland Residential and Fabrica business and within our hard surface products overall. Our Dixie Home business declined due to a shift in strategy by our primary mass merchant customer. Although this change in strategy will continue to negatively impact our Dixie Home business, we have increased our sales in the specialty retail segment by 9% over the prior year, outpacing the market.

In the first quarter of 2022 we experienced a decline in our gross margins primarily due to two major items. First, we were negatively impacted by unprecedented price increases from our primary raw material supplier, coupled with their decision to exit the business. We are working with other suppliers to replace this volume and bring our costs to a more normal level. We expect the conversion to be complete by the end of the second quarter. Second, dramatic increases in ocean freight costs resulted in significant declines in margin on our hard surface business. Fortunately, late in the quarter we began to see a reduction in these freight costs resulting in improved margins for these products.

We are excited about a number of new product offerings introduced during the quarter. We successfully launched our new decorative segment offering introducing 30 new styles under our new brands, 1866 by Masland and Décor by Fabrica. The new offering will include hand tufted, hand loomed, wire wilton, and face to face woven products with fresh looks and on trend colors.

In addition to the launch of our decorative segment offering, we also introduced several new hard surface programs, including TRUCOR Tymbr and Dwellings by Dixie Home. TRUCOR® Tymbr will compete in the high end of the laminate category, and includes a 9.5” wide & 72” long laminate product with excellent water resistance, stunning visuals, and an AC6 scratch resistance rating. Dwellings by Dixie Home, is an engineered wood program which hits mainstream price points and offers beautiful colors and finishes in white oak and hickory. In addition to these new categories, we also have several new innovations in our existing categories planned for introduction to the market in the second quarter. The innovations include: TRUCOR® Boardwalk, a new SPC offering featuring clean visuals, lighter colors, and a new pillowed edge bevel for an authentic look, TRUCOR® Prime Pinnacle, a new

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The following information was filed by Dixie Group Inc (DXYN) on Wednesday, May 11, 2022 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Inside Dixie Group Inc's 10-Q Quarterly Report:

Financial - Expense Highlight
The following important factors may affect our future results and could cause those results to differ materially from our historical results; these factors include, in addition to those "Risk Factors" detailed in item 1A of this report, and described elsewhere in this document, the cost and availability of capital, raw material and transportation costs related to petroleum price levels, the cost and availability of energy supplies, the loss of a significant customer or group of customers, the ability to attract, develop and retain qualified personnel, materially adverse changes in economic conditions generally in carpet, rug and floorcovering markets we serve and other risks detailed from time to time in our filings with the Securities and Exchange Commission.

Other - Other Highlight
We had net borrowings on our revolving credit facility of $5.0 million and net borrowings on notes payable and financing leases of $2.1 million which included a new note payable on buildings (see Note 8).
Financial - Expense Highlight
The higher costs in the second quarter of 2022 as compared to the second quarter of 2021 were primarily due to higher investment in product offerings through product development and samples and marketing, these expenses being escalated by increases in raw material costs.
Financial - Expense Highlight
The higher costs in the first half of 2022 as compared to the first half of 2021 were primarily due to higher investment in product offerings through product development and samples and marketing, these expenses being escalated by increases in raw material costs.
Financial - Expense Highlight
Interest Expense Interest expense decreased $161 thousand in the second quarter of 2022 compared with the second quarter of 2021.
Financial - Expense
Interest Expense Interest expense decreased...Read more
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Such benefits, if recognized, would...Read more
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The expenses in the second...Read more
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The decision by our primary...Read more
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Table of Contents 22 Other...Read more
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Accounts payable and accrued expenses...Read more
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The Company is in a...Read more
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Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Material Contracts, Statements, Certifications & more

Dixie Group Inc provided additional information to their SEC Filing as exhibits

Exhibit 31.1: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 31.2: Rule 13A-14(A)/15D-14(A) Certification

Exhibit 32.1: Section 1350 Certification

Exhibit 32.2: Section 1350 Certification

Ticker: DXYN
CIK: 29332
Form Type: 10-Q Quarterly Report
Accession Number: 0000029332-22-000125
Submitted to the SEC: Mon Aug 08 2022 4:37:52 PM EST
Accepted by the SEC: Mon Aug 08 2022
Period: Saturday, June 25, 2022
Industry: Carpets And Rugs