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 November 2007 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 S.P.A. (NYSE: NTZ) Announces Consolidated
Third Quarter 2007 Financial Results
SANTERAMO IN COLLE, Bari, Italy--(BUSINESS WIRE)--Nov. 14, 2007--
Third Quarter 2007 Financial Highlights
-- Total Net Sales Down by 10.9% at EUR 141.3 Million and Seats
Sold Down by 13.5% over 3Q06
-- Operating Loss of EUR 11.0 Million, versus Operating Loss of
EUR 1.1 Million in 3Q06
-- Net Losses at EUR 14.1 Million versus Net Earnings of EUR 0.8
Million in 3Q06
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 consolidated financial statements for
the third quarter 2007.
NET SALES
Natuzzi third quarter 2007 net sales were at EUR 141.3 million,
down 10.9 percent from EUR 158.5 million in third quarter 2006. During
the first nine months of 2007, total net sales decreased by 15.7
percent at EUR 457.5 million from EUR 542.4 million reported for the
same comparable period of 2006.
In the third quarter 2007, upholstery net sales were at EUR 125.3
million, decreasing by 11.8 percent with respect to EUR 142.0 million
in third quarter 2006. During the same period, the Group sold 594,888
seats, or 13.5 percent less than the same comparable period of 2006.
Other sales (principally living room accessories and raw material
produced by the Group and sold to third parties) decreased 3.0 percent
to EUR 16.0 million over third quarter 2006.
During the quarter ended September 30, 2007 net sales in the
Americas decreased by 19.0 percent at EUR 48.7 million from EUR 60.1
million in third quarter 2006, by 6.1 percent in Europe at EUR 64.6
million and by 8.4 percent in the rest of the world at EUR 12.0
million.
In the third quarter of 2007, 11 new Natuzzi Stores were opened (2
in France, 2 in UK, 2 in the Netherlands, and 1 in Germany, Russia,
Romania, Poland and China), whereas 1 store was closed in Hungary,
thus bringing the total number of Natuzzi Stores to 290 as of
September 30, 2007. As of the same date, there were 486 Natuzzi
Galleries worldwide.
Quarterly leather-upholstery net sales were at EUR 113.3 million,
down 8.2 percent from EUR 123.4 million in third quarter of 2006 and
fabric-upholstery net sales were at EUR 12.0 million down by 35.5
percent from EUR 18.6 million reported one year ago.
Total sales for Natuzzi branded products decreased by 17.9 percent
at EUR 68.8 million, and sales for Italsofa products by 2.9 percent at
EUR 56.5 percent, respectively from EUR 83.8 million and EUR 58.2
million reported one year ago.
GROSS & OPERATING RESULTS
For the quarter ended September 30, 2007, the Group reported a
gross profit of EUR 38.6 million, down from EUR 51.1 million of last
year comparable period. Gross profit as a percent of sales for the
third quarter 2007 decreased at 27.3 percent from 32.2 percent in
third quarter 2006.
The Group reported for the third quarter of 2007 an operating loss
of EUR 11.0 million as compared to an operating loss of EUR 1.1
million reported one year ago.
FOREX AND TAXES
During the third quarter of 2007 the Group reported a net foreign
exchange loss of EUR 5.9 million, as compared to a net foreign
exchange loss of EUR 0.4 million in last year third quarter.
In the same period, the Group reported a deferred tax asset for
EUR 1.9 million.
NET RESULT AND GROUP EARNINGS PER COMPANY'S SHARE
For the quarter ended on September 30, 2007, the Group reported
net losses of EUR 14.1 million (or EUR 0.26 losses per share), versus
Group's net earnings of EUR 0.8 million (or EUR 0.01 earnings per
share) reported for third quarter of 2006.
Considering the first nine months of 2007, the Group reported net
losses of EUR 23.1 million (or EUR 0.42 losses per share), versus net
earnings of EUR 17.5 million (or EUR 0.32 earnings per share) reported
for the same comparable period of 2006.
Pasquale Natuzzi, Chief Executive Officer and Chairman, thus
commented "The furnishings sector still continues to suffer from
widespread weak business conditions in most of major markets,
particularly noteworthy the US, where sluggish economic activity and
concerns about credit situation have dampened the demand for
discretionary spending.
The persisting unfavorable level of Euro exchange rates against
major currencies, U.S. dollar first of all, marketing investments not
completely absorbed by current production volumes, the strong
revaluation of the Brazilian currency against USD which has negatively
affected the competitiveness of our manufacturing operations in the
South American country, and the upward pressure in the raw material
market, have all contributed to the quarterly unsatisfactory results.
Although such a challenging business scenario, we registered an
encouraging recovery in the order flow in the third quarter, thus
reducing the negative gap on a year-to-date basis to a low-digit
decrease".
Mr. Natuzzi concluded: "We remain committed to invest in the
repositioning of the Natuzzi brand and reorganization of our sales
activities and we continue to be focused on the current restructuring
process of our operations, so to regain competitiveness and
profitability in the medium term".
THIRD QUARTER 2007 TELECONFERENCE
Pasquale Natuzzi, Chief Executive Officer and Chairman, Filippo
Simonetti, 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 November 15,
2007.
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 124 stores, and 1 Natuzzi
Store. Outside Italy, the Company sells to various furniture
retailers, as well as through 165 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.
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.
NATUZZI S.P.A. AND SUBSIDIARIES
Unaudited Consolidated Statement of Earnings for the quarters ended on
September 30, 2007 and 2006 on the basis of Italian GAAP
(Expressed in millions of EUR except per share data)
---------------------
Three months ended on % Over Percent of Sales
30-Sep-07 30-Sep-06 (Under) 30-Sep-07 30-Sep-
06
---------------------- ---------- ---------- ------- --------- -------
Upholstery net sales 125.3 142.0 (11.8)% 88.7% 89.6%
Other sales 16.0 16.5 (3.0)% 11.3% 10.4%
Total Net Sales 141.3 158.5 (10.9)% 100.0% 100.0%
---------------------- ---------- ---------- ------- --------- -------
Purchases (65.0) (69.4) 6.3% (46.0)% (43.9)%
Labor (21.9) (24.0) 8.8% (15.5)% (15.1)%
Third-party
Manufacturers (3.3) (3.6) 8.3% (2.3)% (2.3)%
Manufacturing Costs (9.9) (8.5) (16.5)% (7.0)% (5.2)%
Inventories, net (2.6) (1.9) (36.8)% (1.8)% (1.2)%
Cost of Sales (102.7) (107.4) 4.4% (72.7)% (67.8)%
---------------------- ---------- ---------- ------- --------- -------
Gross Profit 38.6 51.1 (24.5)% 27.3% 32.2%
---------------------- ---------- ---------- ------- --------- -------
Selling Expenses (38.3) (42.9) 10.7% (27.1)% (27.1)%
General and
Administrative
Expenses (11.3) (9.3) (21.5)% (8.0)% (5.9)%
Operating Income
(Loss) (11.0) (1.1) (7.8)% (0.7)%
---------------------- ---------- ---------- ------- --------- -------
Interest Income, net 0.4 0.3 0.3% 0.2%
Foreign Exchange, net (5.9) (0.4) (4.2)% (0.3)%
Other Income, net 0.4 1.7 0.3% 1.1%
Earnings (Losses)
before taxes and
minority interest (16.1) 0.5 (11.4)% 0.3%
--------------------------------- ---------- ------- --------- -------
Income taxes 1.9 0.2 1.3% 0.1%
Earnings (Losses)
before minority
interest (14.2) 0.7 (10.0)% 0.4%
--------------------------------- ---------- ------- --------- -------
Minority Interest (0.1) (0.1) (0.1)% (0.1)%
Net Earnings (Losses) (14.1) 0.8 (10.0)% 0.5%
---------------------- ---------- ---------- ------- --------- -------
Earnings (Losses) Per
Share (0.26) 0.01
---------------------- ---------- ---------- ------- --------- -------
Average Number of
Shares Outstanding* 54,824,227 54,738,538
--------------------------------- ---------- ------- --------- -------
(*) Net of shares
repurchased
-------------------------------------------------------------- -------
Key Figures in U.S.
dollars (millions) Three months ended on
September September
30, 2007 30, 2006
--------------------------------- ------------------ ---------
Total Net Sales 194.2 202.0
Gross Profit 53.1 65.1
Operating Income
(Loss) (15.1) (1.4)
Net Earnings (Losses) (19.4) 1.0
Earnings (Losses) per
Share (0.36) 0.01
Average exchange rate (U.S.
dollar per Euro) 1.3746 1.2742
--------------------------------------------------------------
NATUZZI S.P.A. AND SUBSIDIARIES
Unaudited Consolidated Statement of Earnings
for the nine-month period ended September 30, 2007 and 2006 on the
basis of Italian GAAP
(Expressed in millions of EUR except per share data)
Nine months ended on % Over Percent of Sales
30-Sep-07 30-Sep-06 (Under) 30-Sep-07 30-Sep-
06
--------------------- ---------- ---------- ----------------- -------
Upholstery net sales 406.3 486.1 (16.4)% 88.8% 89.6%
Other sales 51.2 56.3 (9.1)% 11.2% 10.4%
Total Net Sales 457.5 542.4 (15.7)% 100.0% 100.0%
--------------------- ---------- ---------- ------- --------- -------
Purchases (223.7) (231.8) 3.5% (48.9)% (42.9)%
Labor (73.3) (80.2) 8.6% (16.0)% (14.8)%
Third-party
Manufacturers (11.1) (15.4) 27.9% (2.4)% (2.8)%
Manufacturing Costs (29.0) (25.3) (14.6)% (6.3)% (4.5)%
Inventories, net 10.2 (3.3) 409.1% 2.2% (0.6)%
Cost of Sales (326.9) (356.0) 8.2% (71.5)% (65.6)%
--------------------- ---------- ---------- ------- --------- -------
Gross Profit 130.6 186.4 (29.9)% 28.5% 34.4%
--------------------- ---------- ---------- ------- --------- -------
Selling Expenses (123.9) (137.3) 9.8% (27.1)% (25.3)%
General and
Administrative
Expenses (34.9) (29.2) (19.5)% (7.6)% (5.4)%
Operating Income
(Loss) (28.2) 19.9 (6.2)% 3.7%
-------------------------------- ---------- ------- --------- -------
Interest Income, net 1.2 0.8 0.3% 0.1%
Foreign Exchange, net (4.8) (2.0) (1.0)% (0.4)%
Other Income, net 3.3 4.9 0.7% 0.9%
Earnings (Losses)
before taxes and
minority interest (28.5) 23.6 (6.2)% 4.4%
-------------------------------- ---------- ------- --------- -------
Income taxes 5.2 (6.1) 1.1% (1.1)%
Earnings (Losses)
before minority
interest (23.3) 17.5 (5.1)% 3.2%
-------------------------------- ---------- ------- --------- -------
Minority Interest (0.2) 0.0 0.0% 0.0%
Net Earnings (Losses) (23.1) 17.5 (5.0)% 3.2%
--------------------- ---------- ---------- ------- --------- -------
Earnings (Losses) Per
Share (0.42) 0.32
-------------------------------- ---------- ------- --------- -------
Average Number of
Shares Outstanding* 54,824,227 54,738,538
-------------------------------- ---------- ------- --------- -------
(*) Net of shares
repurchased
---------------------------------------------------------------------
Key Figures in U.S.
dollars (millions) Nine months ended on
September September
30, 2007 30, 2006
-------------------------------- ------------------ -----------------
Total Net Sales 615.2 675.6
Gross Profit 175.6 232.2
Operating Income
(Loss) (37.9) 24.8
Net Earnings (Losses) (31.1) 21.8
Earnings (Losses) per
Share (0.56) 0.40
Average exchange rate
(U.S. dollar per
Euro) 1.3447 1.2455
---------------------------------------------------------------------
GEOGRAPHIC BREAKDOWN
---------------------------------------------------------------------
Sales* Seat Units
Three months ended Three months ended
on % Over on % Over
30-Sep-07 30-Sep-06 (Under) 30-Sep-07 30-Sep-06 (Under)
=================== ========= ================= ========= ===========
Americas 48.7 60.1 (19.0%) 287,502 357,752 (19.6%)
% of total 38.9% 42.3% 48.3% 52.0%
Europe 64.6 68.8 (6.1%) 257,271 274,427 (6.3%)
% of total 51.5% 48.5% 43.3% 39.9%
Rest of
the world 12.0 13.1 (8.4%) 50,115 55,392 (9.5%)
% of total 9.6% 9.2% 8.4% 8.1%
------------------- --------- ----------------- --------- -----------
TOTAL 125.3 142.0 (11.8%) 594,888 687,571 (13.5%)
---------------------------------------------------------------------
* Expressed in millions of EUR
---------------------------------------------------------------------
BREAKDOWN BY COVERING
---------------------------------------------------------------------
Sales* Seat Units
Three months ended Three months ended
on % Over on % Over
30-Sep-07 30-Sep-06 (Under) 30-Sep-07 30-Sep-06 (Under)
========================================================= ===========
Leather 113.3 123.4 (8.2%) 533,974 582,950 (8.4%)
% of total 90.4% 86.9% 89.8% 84.8%
Fabric 12.0 18.6 (35.5%) 60,914 104,621 (41.8%)
% of total 9.6% 13.1% 10.2% 15.2%
Total 125.3 142.0 (11.8%) 594,888 687,571 (13.5%)
---------------------------------------------------------------------
* Expressed in millions of
EUR
---------------------------------------------------------------------
BREAKDOWN BY BRAND
---------------------------------------------------------------------
Sales* Seat Units
Three months ended Three months ended
on % Over on % Over
30-Sep-07 30-Sep-06 (Under) 30-Sep-07 30-Sep-06 (Under)
========================================================= ===========
Natuzzi 68.8 83.8 (17.9%) 242,219 316,702 (23.5%)
% of total 54.9% 59.0% 40.7% 46.1%
Italsofa 56.5 58.2 (2.9%) 352,669 370,869 (4.9%)
% of total 45.1% 41.0% 59.3% 53.9%
TOTAL 125.3 142.0 (11.8%) 594,888 687,571 (13.5%)
---------------------------------------------------------------------
GEOGRAPHIC BREAKDOWN
----------------------------------------------------------------------
Sales* Seat Units
Nine months % Over Nine months ended % Over
ended on on
30- 30- (Under)30-Sep-07 30-Sep-06 (Under)
Sep- Sep-
07 06
====================== ======================================= =======
Americas 144.1 186.9 (22.9%) 832,657 1,036,001 (19.6%)
% of total 35.5% 38.4% 45.0% 46.3%
Europe 230.2 264.4 (12.9%) 888,829 1,055,359 (15.8%)
% of total 56.6% 54.4% 48.0% 47.2%
Rest of the world 32.0 34.8 (8.0%) 129,902 144,761 (10.3%)
% of total 7.9% 7.2% 7.0% 6.5%
---------------------- ------ ----- ---------------- --------- -------
TOTAL 406.3 486.1 (16.4%)1,851,388 2,236,121 (17.2%)
----------------------------------------------------------------------
* Expressed in millions of EUR
----------------------------------------------------------------------
BREAKDOWN BY COVERING
----------------------------------------------------------------------
Sales* Seat Units
Nine months % Over Nine months ended % Over
ended on on
30- 30- (Under)30-Sep-07 30-Sep-06 (Under)
Sep- Sep-
07 06
====================== ======================================= =======
Leather 360.0 420.6 (14.4%)1,618,848 1,874,148 (13.6%)
% of total 88.6% 86.5% 87.4% 83.8%
Fabric 46.3 65.5 (29.3%) 232,540 361,973 (35.8%)
% of total 11.4% 13.5% 12.6% 16.2%
Total 406.3 486.1 (16.4%)1,851,388 2,236,121 (17.2%)
----------------------------------------------------------------------
* Expressed in millions of EUR
----------------------------------------------------------------------
BREAKDOWN BY BRAND
----------------------------------------------------------------------
Sales* Seat Units
Nine months % Over Nine months ended % Over
ended on on
30- 30- (Under)30-Sep-07 30-Sep-06 (Under)
Sep- Sep-
07 06
====================== ======================================= =======
Natuzzi 244.6 307.3 (20.4%) 853,269 1,107,774 (23.0%)
% of total 60.2% 63.2% 46.1% 49.5%
Italsofa 161.7 178.8 (9.6%) 998,119 1,128,347 (11.5%)
% of total 39.8% 36.8% 53.9% 50.5%
TOTAL 406.3 486.1 (16.4%)1,851,388 2,236,121 (17.2%)
----------------------------------------------------------------------
* Expressed in millions of EUR
NATUZZI S.P.A. AND SUBSIDIARIES
Unaudited Consolidated Balance Sheet as of
September 30, 2007 and December 31, 2006
(Expressed in millions of EUR)
30-Sep-07 31-Dec-06
------------------------------------------------ --------- ---------
ASSETS
Current Assets:
Cash and cash equivalents 97.7 128.1
Marketable debt securities 0.0 0.0
Trade receivables, net 102.0 119.3
Other receivables 41.5 44.7
Inventories 110.6 100.3
Unrealized foreign exchange gains 0.0 5.5
Prepaid expenses and accrued income 2.3 2.0
Deferred income taxes 16.0 7.5
Total current assets 370.1 407.4
------------------------------------------------ --------- ---------
Non-Current Assets:
Net property, plant and equipment 243.1 246.3
Treasury shares 0.0 0.0
Other assets 18.2 18.7
Deferred income taxes 2.3 2.3
------------------------------------------------ --------- ---------
TOTAL ASSETS 633.7 674.7
------------------------------------------------ --------- ---------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Short-term borrowings 4.6 3.8
Current portion of long-term debt 0.3 0.3
Accounts payable-trade 66.7 79.5
Accounts payable-other 25.7 22.5
Accounts payable shareholders for dividends 0.6 0.6
Unrealized foreign exchange losses 0.3 0.0
Income taxes 0.8 4.6
Salaries, wages and related liabilities 20.7 21.7
Total current liabilities 119.7 133.0
------------------------------------------------ --------- ---------
Long-Term Liabilities:
Employees' leaving entitlement 33.3 35.3
Long-term debt 2.1 2.4
Deferred income taxes 0.0 0.0
Deferred income for capital grants 13.3 14.1
Other liabilities 9.1 10.5
------------------------------------------------ --------- ---------
Minority Interest 0.5 0.6
------------------------------------------------ --------- ---------
Shareholders' Equity:
Share capital 54.8 54.7
Reserves 42.3 42.3
Additional paid-in capital 8.3 8.3
Retained earnings 350.3 373.5
Total shareholders' equity 455.7 478.8
------------------------------------------------ --------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 633.7 674.7
---------------------------------------------------------- ---------
NATUZZI S.P.A. AND SUBSIDIARIES
Unaudited Consolidated Statement of Cash Flows
as of September 30, 2007 and 2006
(Expressed in millions of EUR)
30- 30-
Sep- Sep-
07 06
------ ------
Cash flows from operating activities:
Net earnings (losses) (23.1) 17.5
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 22.4 23.1
Employees' leaving entitlement (1.9) 1.8
Deferred income taxes (8.5) (2.3)
Minority interest (0.2) 0.0
(Gain) loss on disposal of assets 0.1 0.4
Unrealized foreign exchange (losses) / gain 5.8 (6.6)
Deferred income for capital grants (0.8) (0.8)
Change in assets and liabilities:
Receivables, net 17.3 13.1
Inventories (10.2) 3.5
Prepaid expenses and accrued income (0.4) (0.1)
Other assets 3.2 4.2
Accounts payable (12.9) (2.9)
Income taxes (3.8) 1.0
Salaries, wages and related liabilities (1.0) (1.0)
Other liabilities 2.9 2.7
Total adjustments 12.0 36.1
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES (11.1) 53.6
-------------------------------------------------------- ------ ------
Cash flows from investing activities:
Property, plant and equipment:
Additions (19.2) (11.8)
Disposals 0.4 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 (0.1) (3.1)
Disposal of business 0.0 0.0
NET CASH USED BY INVESTING ACTIVITIES (18.9) (14.7)
-------------------------------------------------------- ------ ------
Cash flows from financing activities:
Long term debt:
Proceeds 0.0 0.0
Repayments (0.3) (0.6)
Short-term borrowings 0.8 (3.6)
Dividends paid to shareholders 0.0 0.0
Dividends paid to minority shareholders 0.0 0.0
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES 0.5 (4.2)
-------------------------------------------------------- ------ ------
Effect of translation adjustments on cash (0.9) (0.7)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (30.4) 34.0
-------------------------------------------------------- ------ ------
Cash and cash equivalents, beginning of the year 128.1 89.7
CASH AND CASH EQUIVALENTS, END OF THE PERIOD 97.7 123.7
-------------------------------------------------------- -------------
CONTACT: Natuzzi S.p.A.
Investor Relations Dept.
Tel.: +39-080-8820-812
Fax: +39-080-8820-241
E-mail: investor_relations@natuzzi.com
or
Corporate Press Office
Tel.: +39-080-8820-124
Fax: +39-080-8820-508
E-mail: relazioni.esterne@natuzzi.com
or
www.natuzzi.com
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: November 14, 2007
By: /s/ FILIPPO SIMONETTI
--------------------------
Filippo Simonetti