IVESTITURE EYED: Belding Heminway said it is planning to divest its home furnishings division and concentrate on its thread and button divisions.
Belding expects to report a fourth-quarter loss, primarily noncash and including good will for the disposal of the home furnishings division, of $8 million, or $2.40 a share. It also expects to record an after-tax restructuring charge of $22 million, or $3 per share, related to its thread division. The charge represents a write-off of goodwill with the balance reflecting costs for productivity improvements in the thread division.
For the nine months ended Sept. 30, the thread and button division had sales of $71 million, while the home furnishings division had sales of $24 million.
Bowles Hollowell Conner & Co., based in Charlotte, N.C., has been retained to assist with the sale of the home furnishings division.
DOMINION FORECAST: Blaming difficult market conditions in its yarns division and European Klopman apparel fabric operation, Dominion Textile Inc. said it expects to report a loss in the second quarter ended Dec. 31 ranging from $4.4 million U.S. ($6 million Canadian) to $5.9 million U.S. ($8 million Canadian).
The Montreal-based company added that it anticipates a return to profitability in the second half, but results are still expected to be below last year.
In the second quarter of last year, Dominion earned $8.6 million Canadian on sales of $396.5 million Canadian.
“Our yarns division has been adversely affected by the more widespread weakness of the North American retail environment,” said John A. Boland 3rd, president and chief executive officer. “In order to control inventories, production has been curtailed at all yarns plants throughout the quarter.” He added that margin pressures continue. “In Europe, Klopman’s results will be below expectations as inventory levels at some customers remain high,” Boland said.
On the positive side, Dominion said its Swift denim business continues to meet expectations; all denim plants are running at capacity. The firm added that Poly-Bond, a nonwovens business, continues to solidify its customer base and may show gains in profits and sales over the first quarter. Positive trends at Swift and Poly-Bond are expected to continue into the second half. Dominion noted second-half performance will benefit from capacity expansions at Swift and Poly-Bond, a recovery in yarns and modest improvement at Klopman and Nordlys. In addition, cotton costs are expected to be lower than in the first half. However, these costs will still be slightly higher than previously anticipated due to severe price volatility and the carryover of higher-priced cotton into the second half.
According to Boland, year-over-year sales growth is expected to be modest while the core businesses, apparel and nonwoven fabrics, should show sales growth of 6 to 8 percent.
NEW POST AT DYERSBURG: Dyersburg Corp. has named Jerome Wiggins president, Dyersburg operations. It is a new post.
Wiggins will have responsibility for all service-related functions. He reports to T. Eugene McBride, chairman, president and chief executive officer.
Wiggins was vice president, chief financial officer, treasurer and secretary. Paul Hallock, vice president, finance, will be chief financial officer and treasurer on an interim basis. Wiggins remains secretary.
Prior to joining Dyersburg in 1989, Wiggins was chief financial officer at VF Corp.