Dixie Group (NASDAQ: DXYN) lifts 2026 income on stronger margins
Rhea-AI Filing Summary
The Dixie Group, Inc. reported second-quarter 2026 net sales of $68,614,000, essentially flat with $68,573,000 a year earlier. Operating income was $3,093,000 versus $3,189,000, and net income from continuing operations was $1,130,000, or $0.07 per diluted share.
For the first six months of 2026, net sales were $127,995,000 compared with $131,563,000 in 2025, while operating income rose to $6,358,000 from $3,200,000 and net income from continuing operations improved to $2,484,000, or $0.16 per diluted share, from a loss of $328,000. Gross profit margin increased to 29.5% in the quarter and 30.9% for the first half, aided by pricing and cost reductions under a Profit Improvement Plan expected to provide $17 million in year-over-year cost reductions and profit contributions. Management also cited challenging housing-related demand, modest increases in receivables and inventory, capital expenditures of $175 thousand, interest expense of $3.9 million for the first half versus $3.4 million a year earlier, and a $1.0 million increase in total debt driven by operating needs.
Positive
- Operating income for the first six months of 2026 rose to $6,358,000 from $3,200,000, indicating substantially stronger operating profitability despite slightly lower net sales.
- Net income from continuing operations for the first half of 2026 improved to $2,484,000, or $0.16 per diluted share, from a loss of $328,000, reflecting better margins and cost control.
Negative
- Interest expense for the first six months of 2026 increased to $3.9 million from $3.4 million, adding to the burden of financing costs.
- Management noted continued softness in the home resale and remodeling environment, signaling ongoing demand pressure in core flooring markets.
Filing Explained
On June 27, cash was $2,095 thousand, below year-end’s $3,204 thousand, alongside $58,830 thousand classified as current debt.
The June 27, 2026 balance sheet reports
This makes the filing’s material structural disclosure a lower reported cash balance alongside debt obligations classified in both current and long-term categories.
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Q2 2026 net sales: $68,614,000
Q2 2026 net income from continuing operations: $1,130,000
Six-month 2026 net sales: $127,995,000
+4 more
7 metrics
Q2 2026 net sales
$68,614,000
Quarter ended June 27, 2026 versus $68,573,000 in Q2 2025
Q2 2026 net income from continuing operations
$1,130,000
Quarter ended June 27, 2026 versus $1,254,000 in Q2 2025
Six-month 2026 net sales
$127,995,000
Six months ended June 27, 2026 versus $131,563,000 in 2025
Six-month 2026 net income from continuing operations
$2,484,000
Six months ended June 27, 2026 versus a loss of $328,000 in 2025
Q2 2026 gross profit margin
29.5%
Gross profit margin for the second quarter of 2026 versus 29.2% in 2025
Six-month 2026 gross profit margin
30.9%
Gross profit margin for the first six months of 2026 versus 28.1% in 2025
Interest expense, first six months 2026
$3.9 million
Interest expense for the first six months of 2026 versus $3.4 million in 2025
Key Terms
Profit Improvement Plan, IEEPA tariffs, discontinued operations, operating lease right-of-use assets
4 terms
Profit Improvement Plan financial
"committed to controlling costs and improving profitability through our previously announced Profit Improvement Plan"
IEEPA tariffs regulatory
"first quarter of 2026 included the benefit of the refund of the IEEPA tariffs"
Measures labeled as IEEPA tariffs are trade restrictions or charges imposed under the U.S. International Emergency Economic Powers Act, a law that lets the government respond to national emergencies with economic tools. For investors, these actions are like suddenly adding a toll to certain imports, exports or transactions: they can raise costs, disrupt supply chains, limit market access, and change a company’s revenue or risk profile overnight.
discontinued operations financial
"Loss from discontinued operations, net of tax"
Discontinued operations are parts of a company that it has decided to sell or shut down, and no longer plans to run in the future. This matters to investors because it helps them understand which parts of the business are ongoing and which are being phased out, providing a clearer picture of the company’s current performance and future prospects. Think of it like a store closing a department—it no longer contributes to sales or profits.
operating lease right-of-use assets financial
"OPERATING LEASE RIGHT-OF-USE ASSETS"
An operating lease right-of-use (ROU) asset is an accounting entry that shows the value of a leased item you have the legal right to use—like a building, vehicle, or equipment—recorded on a company’s balance sheet along with the corresponding lease obligation. Investors care because it adds to reported assets and liabilities, changing measures like leverage and return on assets much like bringing a long-term rental onto the company’s financial snapshot, which can affect credit terms and valuation.
Earnings Snapshot
Q2 2026 net sales: $68,614,000
quarter and six months ended June 27, 2026
Q2 2026 net sales
$68,614,000
compared with $68,573,000 in Q2 2025
Q2 2026 net income from continuing operations
$1,130,000
compared with $1,254,000 in Q2 2025
Six months 2026 net income from continuing operations
$2,484,000
compared with a loss of $328,000 in the first half of 2025
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What were The Dixie Group (DXYN) Q2 2026 sales and earnings?
The Dixie Group reported Q2 2026 net sales of $68,614,000 and net income from continuing operations of $1,130,000, or $0.07 per diluted share. Operating income was $3,093,000, and gross profit margin increased to 29.5% versus 29.2% a year earlier.
How did DXYN’s first-half 2026 results compare with 2025?
For the first six months of 2026, net sales were $127,995,000 versus $131,563,000 in 2025. Operating income rose to $6,358,000 from $3,200,000, and net income from continuing operations was $2,484,000 versus a loss of $328,000.
What margins did The Dixie Group (DXYN) achieve in 2026?
The company’s gross profit margin was 29.5% in Q2 2026 versus 29.2% in 2025. For the first six months of 2026, gross margin reached 30.9% compared with 28.1%, or 29.1% when adjusted for the prior IEEPA tariff refund.
What is DXYN’s Profit Improvement Plan and expected impact?
Management highlighted a Profit Improvement Plan estimated to contribute $17 million in year-over-year cost reductions and profit contributions. Actions include consolidating west coast yarn operations into an existing Roanoke, Alabama plant to lower internal raw material costs and support higher margins.
How did interest expense and debt change for DXYN in 2026?
Interest expense for the first six months of 2026 was $3.9 million, up from $3.4 million a year earlier. The company stated that total debt on the balance sheet increased by $1.0 million from fiscal year-end, driven by operating needs.
What balance sheet trends did DXYN report as of June 27, 2026?
Receivables increased by $4.8 million versus fiscal year-end 2025, reflecting stronger late-quarter sales. Net inventory was $66.9 million versus $66.4 million, and combined accounts payable and accrued expenses were $3.4 million higher, tied to increased production needs and raw material costs.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 6, 2026
(Exact name of registrant as specified in its charter)
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| (Registrant's telephone number, including area code) | |||||
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
1
Item 2.02. Results of Operations and Financial Condition.
On August 6, 2026, The Dixie Group, Inc. issued a press release reporting results for the second quarter ended June 27, 2026.
Item 9.01. Financial Statements and Exhibits.
(c) Exhibits
(99.1) Press Release, dated August 6, 2026
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: | THE DIXIE GROUP, INC. | |||||||
By: /s/ Allen L. Danzey | ||||||||
| Allen L. Danzey | ||||||||
| Chief Financial Officer | ||||||||
Exhibit 99.1
CONTACT: Allen Danzey
Chief Financial Officer
706-876-5865
allen.danzey@dixiegroup.com
THE DIXIE GROUP REPORTS NET INCOME FOR THE SECOND QUARTER OF 2026
DALTON, GEORGIA (August 6, 2026) -- The Dixie Group, Inc. (OTCQB: DXYN) today reported financial results for the quarter ended June 27, 2026.
For the second quarter of 2026, the Company had net sales of $68,614,000 as compared to $68,573,000 in the same quarter of 2025. The Company had an operating income of $3,093,000 compared to an operating income of $3,189,000 in the second quarter of 2025. The net income from continuing operations in the second quarter of 2026 was $1,130,000 or $0.07 per diluted share. In 2025, the net income from continuing operations for the second quarter was $1,254,000 or $0.08 per diluted share.
For the six months ended June 27, 2026, net sales were $127,995,000 or 2.7% below the net sales for the six-month period ended June 28, 2025 at $131,563,000. The operating income for the first six months of 2026 was $6,358,000 compared to an operating income of $3,200,000 in the same period of the prior year. The Company had a net income from continuing operations of $2,484,000 or $0.16 per diluted share for the six months ended June 27, 2026 compared to a net loss from continuing operations of $328,000 or $0.02 per diluted share in the six-month period ending June 28, 2025.
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 $17 million in year over year cost reductions and profit contributions. The Plan includes net savings related to relocating a portion of our west coast yarn operations to our existing yarn plant in Roanoke, Alabama. This manufacturing consolidation began in the second quarter and is expected to lower internal raw material costs.
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.
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The Dixie Group Reports Second Quarter 2026 Results
Page 2
August 6, 2026
The gross profit margin for the second quarter of 2026 was 29.5% compared to 29.2% in the prior year. For the six months ended June 2026, the gross profit margin was 30.9% compared to 28.1% in the first six months of 2025. The first quarter of 2026 included the benefit of the refund of the IEEPA tariffs from the previous year. Adjusted for this refund, the gross profit margin in the first six months of 2026 would have been 29.1%. The improved year over year margins are the result of favorable pricing and cost reductions as part of our Profit Improvement Plan.
Receivables on our balance sheet increased by $4.8 million from the balance at fiscal year-end 2025 due to higher sales in the last month of the second quarter of 2026 as compared to the seasonally lower sales volume in the last month of the previous fiscal year. The second quarter 2026 net inventory value of $66.9 million was slightly higher than the 2025 fiscal year end value of $66.4 million. Combined accounts payable and accrued expenses were $3.4 million greater at the 2026 second quarter end as compared to the 2025 year-end balance. Higher production needs in the comparative periods and higher costs of raw materials contributed to the increase. Capital expenditures for the first six months of 2026 were $175 thousand. Interest expense for the first six months of 2026 was $3.9 million compared to $3.4 million in the first six months of 2025. Our total debt on the balance sheet increased $1.0 million from fiscal year end driven by operating needs.
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.
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The Dixie Group Reports Second Quarter 2026 Results
Page 3
August 6, 2026
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, 2026 | June 28, 2025 | June 27, 2026 | June 28, 2025 | ||||||||||||||||||||
| 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 | 1 | 14,589 | 14,667 | 14,431 | ||||||||||||||||||
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The Dixie Group Reports Second Quarter 2026 Results
Page 4
August 6, 2026
THE DIXIE GROUP, INC.
Consolidated Condensed Balance Sheets
(in thousands)
| June 27, 2026 | December 27, 2025 | ||||||||||
| ASSETS | (Unaudited) | ||||||||||
| CURRENT ASSETS | |||||||||||
| Cash and cash equivalents | $ | 2,095 | $ | 3,204 | |||||||
| Receivables, net of allowances for expected credit losses of $507 and $640 | 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 | |||||||
-END-