THE DIXIE GROUP REPORTS NET INCOME FOR THE SECOND QUARTER OF 2026
Rhea-AI Summary
The Dixie Group (OTCQB:DXYN) reported second quarter 2026 net sales of $68.6 million, essentially flat with $68.6 million a year earlier, with operating income of $3.1 million versus $3.2 million and net income from continuing operations of $1.1 million, or $0.07 per diluted share, compared with $1.3 million, or $0.08 per diluted share, in 2025.
For the first six months of 2026, net sales were $128.0 million, down 2.7% year over year, while operating income rose to $6.4 million from $3.2 million. Net income from continuing operations improved to $2.5 million, or $0.16 per diluted share, from a $0.3 million loss. Gross margin increased to 29.5% in Q2 and 30.9% year to date, aided by pricing and a Profit Improvement Plan targeting $17 million of annualized cost reductions and profit contributions.
Positive
- Six-month operating income rose to $6.4 million from $3.2 million
- Six-month net income from continuing operations improved to $2.5 million from a $0.3 million loss
- Gross margin expanded to 29.5% in Q2 and 30.9% year to date
- Profit Improvement Plan targeted to deliver $17 million in yearly cost reductions and profit contributions
- Stockholders’ equity increased to $11.1 million from $8.8 million since year-end 2025
Negative
- Six-month net sales declined 2.7% year over year to $128.0 million
- Q2 net income from continuing operations decreased to $1.1 million from $1.3 million
- Interest expense for six months increased to $3.9 million from $3.4 million
- Total debt on the balance sheet rose by $1.0 million since fiscal year end 2025
News Explained
June 27 balance-sheet figures show $2,095 thousand cash, higher debt than year-end, and a yarn consolidation already underway with savings still expected.
The Dixie Group reported second-quarter 2026 results for the quarter ended
At
The consolidation moves part of the company’s west coast yarn operations to its existing Roanoke, Alabama, plant; the company expects this to lower internal raw-material costs, while its estimated annual cost reductions and profit contributions remain
The next quarterly results provide a checkpoint for that
AI-generated analysis. How Rhea-AI works. Not financial advice.
For the second quarter of 2026, the Company had net sales of
For the six months ended June 27, 2026, net sales were
Commenting on the results, Daniel K. Frierson, Chairman and Chief Executive Officer, said, "Our results for the quarter showed a modest improvement in gross profit margins on relatively flat year over year net sales. Market conditions remained challenging, reflecting the continued softness in the home resale and remodeling environment. As we continue to monitor market conditions and the uncertain economic environment, we remain committed to controlling costs and improving profitability through our previously announced Profit Improvement Plan. We currently estimate the Plan will contribute
Our sales for the quarter showed strong activity in the higher end segments such as our decorative product lines, 1866 by Masland and Décor by Fabrica, and our Fabrica wood program in our hard floor offerings. Outside of these higher end offerings, our DuraSilkSD polyester category in our DH Floors division increased its market share with strong growth.
During the quarter, we introduced 14 new carpet styles with a strong focus on high end nylon in our Masland and Fabrica divisions. These introductions included a collection of high luster, soft nylon products in our Fabrica brand and a trio of new solid color cut pile products in our Masland line, all which support our Step Into Color campaign. Continuing our Affordable Fashion brand promise in our DH Floors line, we launched several new DuraSilkSD polyester patterns which provide a high-end look and feel at a price point that fits the budget for most consumers. Additional product launches are planned in our soft and hard surface segments during the third quarter.
As conditions in the housing market continue to present a challenge for the flooring industry, we are focusing on strategically introducing new products to the strongest parts of our markets. And we also remain committed to reducing expenses without negatively affecting the quality of our products or service to our customers," Frierson concluded.
The gross profit margin for the second quarter of 2026 was
Receivables on our balance sheet increased by
This press release contains forward-looking statements. Forward-looking statements are based on estimates, projections, beliefs and assumptions of management and the Company at the time of such statements and are not guarantees of performance. Forward-looking statements are subject to risk factors and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements. Such factors include the levels of demand for the products produced by the Company. Other factors that could affect the Company's results include, but are not limited to, availability of raw material and transportation costs related to petroleum prices, the cost and availability of capital, integration of acquisitions, ability to attract, develop and retain qualified personnel and general economic and competitive conditions related to the Company's business. Issues related to the availability and price of energy may adversely affect the Company's operations. Additional information regarding these and other risk factors and uncertainties may be found in the Company's filings with the Securities and Exchange Commission. The Company disclaims any obligation to update or revise any forward-looking statements based on the occurrence of future events, the receipt of new information, or otherwise. |
THE DIXIE GROUP, INC. Consolidated Condensed Statements of Operations (unaudited; in thousands, except earnings (loss) per share) | |||||||
Three Months Ended | Six Months Ended | ||||||
June 27, | June 28, | June 27, | June 28, | ||||
NET SALES | $ 68,614 | $ 68,573 | $ 127,995 | $ 131,563 | |||
Cost of sales | 48,381 | 48,557 | 88,473 | 94,645 | |||
GROSS PROFIT | 20,233 | 20,016 | 39,522 | 36,918 | |||
Selling and administrative expenses | 16,730 | 16,778 | 32,726 | 33,652 | |||
Other operating income, net | (90) | (68) | (174) | (166) | |||
Facility consolidation and severance expenses, net | 500 | 117 | 612 | 232 | |||
OPERATING INCOME | 3,093 | 3,189 | 6,358 | 3,200 | |||
Interest expense | 1,966 | 1,872 | 3,871 | 3,365 | |||
Other (income) expense, net | (55) | (4) | (87) | 84 | |||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE TAXES | 1,182 | 1,321 | 2,574 | (249) | |||
Income tax provision | 52 | 67 | 90 | 79 | |||
INCOME (LOSS) FROM CONTINUING OPERATIONS | 1,130 | 1,254 | 2,484 | (328) | |||
Loss from discontinued operations, net of tax | (42) | (94) | (245) | (209) | |||
NET INCOME (LOSS) | $ 1,088 | $ 1,160 | $ 2,239 | $ (537) | |||
BASIC EARNINGS (LOSS) PER SHARE: | |||||||
Continuing operations | $ 0.07 | $ 0.08 | $ 0.16 | $ (0.02) | |||
Discontinued operations | (0.00) | (0.01) | (0.02) | (0.01) | |||
Net income (loss) | $ 0.07 | $ 0.07 | $ 0.14 | $ (0.03) | |||
DILUTED EARNINGS (LOSS) PER SHARE: | |||||||
Continuing operations | $ 0.07 | $ 0.08 | $ 0.16 | $ (0.02) | |||
Discontinued operations | (0.00) | (0.01) | (0.02) | (0.01) | |||
Net income (loss) | $ 0.07 | $ 0.07 | $ 0.14 | $ (0.03) | |||
Weighted-average shares outstanding: | |||||||
Basic | 14,616 | 14,496 | 14,574 | 14,431 | |||
Diluted | 14,709 | 14,589 | 14,667 | 14,431 | |||
THE DIXIE GROUP, INC. Consolidated Condensed Balance Sheets (in thousands) | |||
June 27, | December 27, | ||
ASSETS | (Unaudited) | ||
CURRENT ASSETS | |||
Cash and cash equivalents | $ 2,095 | $ 3,204 | |
Receivables, net of allowances for expected credit losses of | 27,773 | 22,984 | |
Receivables - tariff refunds | 3,057 | 0 | |
Inventories, net | 66,929 | 66,370 | |
Prepaid and other current assets | 6,703 | 5,391 | |
TOTAL CURRENT ASSETS | 106,557 | 97,949 | |
PROPERTY, PLANT AND EQUIPMENT, NET | 26,937 | 29,154 | |
OPERATING LEASE RIGHT-OF-USE ASSETS | 23,698 | 23,649 | |
RESTRICTED CASH | 4,033 | 3,865 | |
OTHER ASSETS | 19,011 | 19,488 | |
LONG-TERM ASSETS OF DISCONTINUING OPERATIONS | 1,137 | 1,053 | |
TOTAL ASSETS | $ 181,373 | $ 175,158 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||
CURRENT LIABILITIES | |||
Accounts payable | $ 24,153 | $ 22,781 | |
Accrued expenses | 18,066 | 16,043 | |
Current portion of long-term debt | 58,830 | 56,642 | |
Current portion of operating lease liabilities | 5,254 | 4,553 | |
Current liabilities of discontinued operations | 1,204 | 1,073 | |
TOTAL CURRENT LIABILITIES | 107,507 | 101,092 | |
LONG-TERM DEBT, NET | 23,935 | 25,096 | |
OPERATING LEASE LIABILITIES | 19,623 | 20,200 | |
OTHER LONG-TERM LIABILITIES | 15,800 | 16,651 | |
LONG-TERM LIABILITIES OF DISCONTINUED OPERATIONS | 3,411 | 3,321 | |
STOCKHOLDERS' EQUITY | 11,097 | 8,798 | |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 181,373 | $ 175,158 | |
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SOURCE The Dixie Group, Inc.