CONFORMED
Securities and Exchange Commission
Washington, D.C. 20549
FORM 6-K
Report of Foreign Issuer
Pursuant To Rule 13a-16 Or 15d-16
Of The
Securities Exchange Act of 1934
For the month of May 2008 Commission File Number 1-11854
NATUZZI S.p.A.
(Translation of Registrant's name into English)
Via Iazzitiello 47
70029 Santeramo, Italy
(Address of principal office)
(Indicate by check mark whether the registrant files or will file
annual reports under cover of Form 20-F or Form 40-F.)
(Check One) Form 20-F x Form 40-F
---- ---
(Indicate by check mark whether the registrant by furnishing the
information contained in this Form is also thereby furnishing information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.)
(Check One) Yes No X
--- ---
(If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b). 82-___.)
NATUZZI
It's how you live
Investor Relations Dept.
Natuzzi S.p.A. Tel.: +39-080-8820-812
Via Iazzitiello 47, investor_relations@natuzzi.com
70029 Santeramo (BA) - Italy
Tel.:+39 080 8820.111 Corporate Press Office
Fax: +39 080 8820.241 Tel.: +39-080-8820-124
www.natuzzi.com relazioni.esterne@natuzzi.com
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NATUZZI'S BOARD OF DIRECTORS ANNOUNCES CONSOLIDATED
FIRST QUARTER 2008 FINANCIAL RESULTS
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1Q08 FINANCIAL HIGHLIGHTS
- TOTAL NET SALES UP BY 12.4% AT EUR 172.8 MILLION AND UNITS SOLD UP BY
15.9%OVER 1Q07
- OPERATING LOSS AT EUR 12.1 MILLION FROM AN OPERATING LOSS OF EUR 7.9
MILLION IN 1Q07
- NET LOSSES AT EUR 23.4 MILLION FROM NET LOSSES OF EUR 4.7 MILLION IN
1Q07
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Santeramo in Colle, Bari, Italy - May 28, 2008 - The Board of
Directors of Natuzzi S.p.A. (NYSE: NTZ) (`Natuzzi' or `the Group'), the
world's leading manufacturer of leather-upholstered furniture, today
presented the first quarter 2008 consolidated financial results.
NATUZZI
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NET SALES
During the first quarter of 2008 Natuzzi total net sales increased
by 12.4 percent at Eur 172.8 million, as compared to Eur 153.8 million
reported for the first quarter of 2007. During the same period, seats sold
were up 15.9 percent over last year same quarter.
For the first three months of 2008 upholstery net sales were at Eur
153.7 million, 13.0 percent up with respect to Eur 136.0 million of the same
comparable quarter of 2007. Other sales (principally living room accessories
and raw materials produced by the Group and sold to third parties) increased
by 7.3 percent at Eur 19.1 million over first quarter 2007.
During the quarter ended on March 31, 2008, net sales in the
Americas increased by 6.9 percent at Eur 49.6 million, by 13.1 percent in
Europe at Eur 89.9 million and by 40.6 percent at Eur 14.2 million in the
rest of the world as compared to the same period of last year.
Leather-upholstered furniture sales for the first quarter of 2008
were at Eur 138.7 million, up 15.6 percent from Eur 120.0 million of the
first quarter 2007, whereas fabric-upholstered furniture sales decreased by
6.3 percent at Eur 15.0 million over first quarter of 2007.
Net sales for the Natuzzi branded products increased by 7.4 percent
at Eur 87.0 million and net sales for Italsofa products by 21.3 percent at
Eur 66.7 million with respect to the same period of last year.
GROSS & OPERATING RESULTS
For the three-month period ended on March 31, 2008, the Group
reported a gross profit of Eur 44.1 million, decreasing 6.0 percent from Eur
46.9 million in the first quarter of 2007. As a percentage of sales, gross
margin decreased at 25.5 percent from 30.5 percent reported in the first
three months of last year.
In the first quarter of 2008 the Group had an operating loss of Eur
12.1 million as compared with an operating loss of Eur 7.9 million reported
last year.
FOREX AND TAXES
During the first three months of 2008 the Group had a net foreign
exchange loss of Eur 10.0 million, of which a loss of Eur 9.2 million was
not realized. Such unrealized loss on foreign exchange is mostly the result
of the high volatility of the Euro against major currencies that has
negatively affected the valuation at the end of the quarter of our
outstanding net assets denominated in foreign currency.
Income taxes for the first quarter of 2008 were Eur 1.0 million.
NET RESULT AND GROUP EARNINGS PER COMPANY'S SHARE
For the quarter ended on March 31, 2008 the Group reported net
losses of Eur 23.4 million, or Eur 0.43 losses per share (ADR), compared to
net losses of Eur 4.7 million, or Eur 0.09 per share, in the first quarter
of 2007.
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Pasquale Natuzzi, Chairman and CEO, commented: "The Group reported
a double digit increase in net sales in the first three months of 2008
versus the same period of last year - for the most part fed by the backlog
accumulated at the beginning of the year - but unfortunately operating
results in the quarter were disappointing. The negative performance was due
to the strong price pressure especially in the US market where the furniture
industry is still struggling to come out of one of the worst crisis of the
last decades, and the sharp devaluation of the US Dollar against the
currencies of the countries where we manufacture products exported in United
States. In consideration of these issues, the Group announced in March price
increases across our brands that should fully produce effects in the second
half of the year, thus enabling the Group to recover margins".
"Operating results were further burdened by the unsatisfactory
performance of our Brazilian manufacturing plants, whose competitiveness has
not only been curbed by the above mentioned devaluation of the US Dollar
against local currency, but also by the low productivity of the plants".
"We remain firmly committed in implementing all the necessary
measures to further control our cost structure, including the right sizing
of the headcounts at our Italian locations to the current level of the seats
order flow produced in Italy which is year-to-date more than 10 percent
lower than the same period of last year. We are also continuing to
reorganize our manufacturing assets, both in Italy and abroad, to regain
efficiency in the remaining part of the year".
"The Group is focusing its attention on the development of foreign
markets, like East Europe, Middle East, China and India, where we have been
achieving significant results both in terms of sales and order flow. We will
continue to invest in the Natuzzi brand awareness worldwide and closely
monitor the profitability of our retail activities so to close our non
performing units".
"All the above mentioned initiatives are part of a business plan
that is still subject to a critical review regarding the overall scenario on
which it is based. We are confident that such business plan, once completed,
will include all the necessary actions that will enable the Group to regain
competitiveness and profitability in the medium term".
FIRST QUARTER 2008 TELECONFERENCE
---------------------------------
Pasquale Natuzzi, Chief Executive Officer and Chairman, Salvatore
Gaipa, Chief Financial Officer and Nicola Dell'Edera, Finance Director, will
discuss financial results, followed by a question and answer session, in a
teleconference at 10:00 a.m. New York time (3:00 p.m. London time - 4:00
p.m. Italian time) on Thursday May 29, 2008.
For further information, please contact:
Investor Relations Dept. Corporate Press Office
------------------------ ----------------------
Tel.: +39-080-8820-812 Tel.: +39-080-8820-124
Fax: +39-080-8820-241 Fax: +39-080-8820-508
E-mail: investor_relations@natuzzi.com E-mail: relazioni.esterne@natuzzi.com
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ABOUT NATUZZI S.P.A.
--------------------
Founded in 1959 by Pasquale Natuzzi, Natuzzi S.p.A. designs and
manufactures a broad collection of leather-upholstered residential
furniture.
Italy's largest furniture manufacturer, Natuzzi is the global leader
in the leather segment, exporting its innovative, high-quality sofas and
armchairs to 123 markets on 5 continents.
Since 1990, Natuzzi has sold its furnishings in Italy through the
popular Divani & Divani by Natuzzi chain of 123 stores, and 1 Natuzzi Store.
Outside Italy, the Company sells to various furniture retailers, as well as
through 184 licensed Divani & Divani by Natuzzi and Natuzzi Stores.
Natuzzi S.p.A. was listed on the New York Stock Exchange on May 13,
1993. The Company is ISO 9001 and 14001 certified
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FORWARD-LOOKING STATEMENTS
--------------------------
Statements in this press release other than statements of
historical fact are "forward-looking statements". Forward-looking statements
are based on management's current expectations and beliefs and therefore you
should not place undue reliance on them. These statements are subject to a
number of risks and uncertainties, including risks that may not be subject
to the Group's control, that could cause actual results to differ materially
from those contained in any forward-looking statement. These risks include,
but are not limited to, fluctuations in exchange rates, economic and weather
factors affecting consumer spending, competitive and regulatory environment,
as well as other political, economical and technological factors, and other
risks identified from time to time in the Group's filings with the
Securities and Exchange Commission, particularly in the Group's annual
report on Form 20-F. Forward looking statements speak as of the date they
were made, and the Group undertakes no obligation to update publicly any of
them in light of new information or future events.
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- Tables follow -
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NATUZZI S.P.A. AND SUBSIDIARIES
Unaudited Consolidated Statement of Earnings for the quarters ended on
March 31, 2008 and 2007 on the basis of Italian GAAP (Expressed in
millions of EUR except per share data)
------------------------------- ----------- ------------------------------
Three months ended on Abs. % Over Percent of Sales
Diff.
31-Mar-08 31-Mar-07 (Under) 31-Mar-08 31-Mar-07
--------------------------- ----------- ----------- ------- ----------- --------------- --------------
Upholstery net sales 153.7 136.0 17.7 13.0% 88.9% 88.4%
Other sales 19.1 17.8 1.3 7.3% 11.1% 11.6%
Total Net Sales 172.8 153.8 19.0 12.4% 100.0% 100.0%
--------------------------- ----------- ----------- ------- ----------- --------------- --------------
Purchases (81.6) (87.2) 5.6 6.4% (47.2)% (56.7)%
Labor (28.9) (24.8) (4.1) (16.5)% (16.7)% (16.1)%
Third-party Manufacturers (4.9) (4.0) (0.9) (22.5)% (2.8)% (2.6)%
Manufacturing Costs (11.6) (7.7) (3.9) (50.6)% (6.7)% (5.0)%
Inventories, net (1.7) 16.8 (18.5) (110.1)% (1.0)% 10.9%
Cost of Sales (128.7) (106.9) (21.8) (20.4)% (74.5)% (69.5)%
--------------------------- ----------- ----------- ------- ----------- --------------- --------------
Gross Profit 44.1 46.9 (2.8) (6.0)% 25.5% 30.5%
--------------------------- ----------- ----------- ------- ----------- --------------- --------------
Selling Expenses (44.9) (43.4) (1.5) (3.5)% (26.0)% (28.2)%
General and Administrative
Expenses (11.3) (11.4) 0.1 0.9% (6.5)% (7.4)%
Operating Income (Loss) (12.1) (7.9) (4.2) (53.2)% (7.0)% (5.1)%
--------------------------- ----------- ----------- ------- ----------- --------------- --------------
Interest Income, net (0.1) 0.5 (0.6) (0.1)% 0.3%
Foreign Exchange, net (10.0) 0.5 (10.5) (5.8)% 0.3%
Other Income, net (0.3) 1.1 (1.4) (0.2)% 0.7%
Earnings (Losses) before
taxes and minority interest (22.5) (5.8) (16.7) (287.9)% (13.0)% (3.8)%
--------------------------------------- ----------- ------- ----------- --------------- --------------
Income taxes (1.0) 1.1 (2.1) (0.6)% 0.7%
Earnings (Losses) before
minority interest (23.5) (4.7) (18.8) (400.0)% (13.6)% (3.1)%
--------------------------------------- ----------- ------- ----------- --------------- --------------
Minority Interest (0.1) 0.0 (0.1) (0.1)% 0.0%
Net Earnings (Losses) (23.4) (4.7) (18.7) (397.9)% (13.5)% (3.1)%
--------------------------- ----------- ----------- ------- ----------- --------------- --------------
Earnings (Losses) Per Share (0.43) (0.09) (0.34)
--------------------------- ----------- ----------- ------- ----------- --------------- --------------
Average Number of Shares
Outstanding* 54,853,045 54,824,227
--------------------------------------- ----------- ------- ----------- --------------- --------------
(*) Net of shares
repurchased
----------------------------------------------------------- ----------- ------------------------------
Key Figures in U.S. dollars Three months ended on Abs. % Over Percent of Sales
(millions) Diff.
31-Mar-08 31-Mar-07 (Under) 31-Mar-08 31-Mar-07
--------------------------------------- ------------------- ----------- --------------- --------------
Total Net Sales 259.3 201.6 57.7 28.6% 100.0% 100.0%
Gross Profit 66.2 61.5 4.7 7.6% 25.5% 30.5%
Operating Income (Loss) (18.2) (10.4) (7.8) (75.0)% (7.0)% (5.2)%
Net Earnings (Losses) (35.1) (6.2) (28.9) (466.1)% (13.5)% (3.1)%
Earnings (Losses) per Share (0.65) (0.12) (0.53)
Average exchange rate (U.S.
dollar per Euro) 1.5007 1.3109
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GEOGRAPHIC BREAKDOWN
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Sales* Seat Units
Three months ended on Abs. % Over Three months ended on Abs. Diff. % Over
Diff.
31-Mar-08 31-Mar-07 (Under) 31-Mar-08 31-Mar-07 (Under)
=== ========== ========= ======= ==================== =========== ========== ===========
Americas 49.6 46.4 3.2 6.9% 307,881 258,753 49,128 19.0%
% of total 32.3% 34.1% 42.8% 41.7%
Europe 89.9 79.5 10.4 13.1% 352,623 320,083 32,540 10.2%
% of total 58.5% 58.5% 49.1% 51.6%
Rest of the
world 14.2 10.1 4.1 40.6% 58,121 41,266 16,855 40.8%
% of total 9.2% 7.4% 8.1% 6.7%
------------------------- --------- ------- -------------------- ----------- ---------- -----------
TOTAL 153.7 136.0 17.7 13.0% 718,625 620,102 98,523 15.9%
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* Expressed in millions of EUR
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BREAKDOWN BY COVERING
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Sales* Seat Units
Three months ended on Abs. % Over Three months ended on Abs. Diff. % Over
Diff.
31-Mar-08 31-Mar-07 (Under) 31-Mar-08 31-Mar-07 (Under)
=== ========== ========= ======= ==================== =========== ========== ===========
Leather 138.7 120.0 18.7 15.6% 643,156 535,756 107,400 20.0%
% of total 90.2% 88.2% 89.5% 86.4%
Fabric 15.0 16.0 (1.0) (6.3%) 75,469 84,346 (8,877) (10.5%)
% of total 9.8% 11.8% 10.5% 13.6%
Total 153.7 136.0 17.7 13.0% 718,625 620,102 98,523 15.9%
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* Expressed in millions of EUR
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BREAKDOWN BY BRAND
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Sales* Seat Units
Three months ended on Abs. % Over Three months ended on Abs. Diff. % Over
Diff.
31-Mar-08 31-Mar-07 (Under) 31-Mar-08 31-Mar-07 (Under)
=== ========== ========= ======= ==================== =========== ========== ===========
Natuzzi 87.0 81.0 6.0 7.4% 304,885 285,349 19,536 6.8%
% of total 56.6% 59.6% 42.4% 46.0%
Italsofa 66.7 55.0 11.7 21.3% 413,740 334,753 78,987 23.6%
% of total 43.4% 40.4% 57.6% 54.0%
TOTAL 153.7 136.0 17.7 13.0% 718,625 620,102 98,523 15.9%
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* Expressed in millions of EUR
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NATUZZI S.P.A. AND SUBSIDIARIES
Unaudited Consolidated Balance Sheet as of
March 31, 2008 and December 31, 2007 (Expressed in millions of EUR)
31-Mar-08 31-Dec-07
--------------------------------------------------- ------------ -------------
ASSETS
Current Assets:
Cash and cash equivalents 78.3 87.5
Marketable debt securities 0.0 0.0
Trade receivables, net 115.5 117.7
Other receivables 47.3 47.8
Inventories 105.6 107.3
Unrealized foreign exchange gains 1.5 0.9
Prepaid expenses and accrued income 2.1 1.8
Deferred income taxes 1.5 1.3
Total current assets 351.8 364.3
--------------------------------------------------- ------------ -------------
Non-Current Assets:
Net property, plant and equipment 228.1 235.9
Treasury shares 0.0 0.0
Other assets 14.9 17.3
Deferred income taxes 0.0 0.0
--------------------------------------------------- ------------ -------------
TOTAL ASSETS 594.8 617.5
--------------------------------------------------- ------------ -------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Short-term borrowings 5.5 7.6
Current portion of long-term debt 0.3 0.3
Accounts payable-trade 92.6 89.3
Accounts payable-other 30.0 29.2
Accounts payable shareholders for dividends 0.6 0.6
Unrealized foreign exchange losses 0.0 0.0
Income taxes 1.6 1.6
Salaries, wages and related liabilities 20.5 17.5
Total current liabilities 151.1 146.1
--------------------------------------------------- ------------ -------------
Long-Term Liabilities:
Employees' leaving entitlement 32.7 33.3
Long-term debt 2.1 2.1
Deferred income taxes 0.0 0.0
Deferred income for capital grants 12.8 13.3
Other liabilities 10.8 10.9
--------------------------------------------------- ------------ -------------
Minority Interest 0.1 0.2
--------------------------------------------------- ------------ -------------
Shareholders' Equity:
Share capital 54.9 54.8
Reserves 42.3 42.3
Additional paid-in capital 8.3 8.3
Retained earnings 279.7 306.2
Total shareholders' equity 385.2 411.6
--------------------------------------------------- ------------ -------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 594.8 617.5
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NATUZZI S.P.A. AND SUBSIDIARIES
Unaudited Consolidated Statement of Cash Flows as of March 31, 2008
and 2007 (Expressed in millions of EUR)
31-Mar-08 31-Mar-07
------------ ------------
Cash flows from operating activities:
Net earnings (losses) (23.4) (4.7)
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 7.4 7.2
Employees' leaving entitlement (0.6) (0.2)
Deferred income taxes (0.2) (3.0)
Minority interest (0.1) 0.0
(Gain) loss on disposal of assets 0.2 0.0
Unrealized foreign exchange (losses) / gain (0.6) 1.4
Deferred income for capital grants (0.2) (0.3)
Change in assets and liabilities:
Receivables, net 2.2 10.9
Inventories 1.7 (16.8)
Prepaid expenses and accrued income (0.3) (2.0)
Other assets 0.6 (2.8)
Accounts payable 3.3 2.5
Income taxes 0.0 (0.7)
Salaries, wages and related liabilities 3.0 0.2
Other liabilities 2.6 1.6
Total adjustments 19.0 (2.0)
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES (4.4) (6.7)
------------------------------------------------------ ------------ ------------
Cash flows from investing activities:
Property, plant and equipment:
Additions (2.6) (6.0)
Disposals 0.0 0.2
Government grants received 0.0 0.0
Marketable debt securities:
Proceeds from sales 0.0 0.0
Purchase of business, net of cash acquired 0.0 0.0
Disposal of business 1.1 0.0
NET CASH USED BY INVESTING ACTIVITIES (1.5) (5.8)
------------------------------------------------------ ------------ ------------
Cash flows from financing activities:
Long term debt:
Proceeds 0.0 0.0
Repayments 0.0 0.0
Short-term borrowings (2.1) 7.9
Dividends paid to shareholders 0.0 0.0
Dividends paid to minority shareholders 0.0 0.0
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES (2.1) 7.9
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Effect of translation adjustments on cash (1.2) 0.1
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (9.2) (4.5)
------------------------------------------------------ ------------ ------------
Cash and cash equivalents, beginning of the year 87.5 128.1
CASH AND CASH EQUIVALENTS, END OF THE PERIOD 78.3 123.6
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8
CONFORMED
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, thereunto duly authorized.
NATUZZI S.p.A.
(Registrant)
Date: May 28, 2008
By: /s/ SALVATORE GAIPA
----------------------------
Salvatore Gaipa