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FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT MAY 27, 1997
Commission File No. 0-209
BASSETT FURNITURE INDUSTRIES, INCORPORATED
(Exact name of Registrant as specified in its charter)
Virginia 54-0135270
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(State or other jurisdiction (l.R.S. Employer
of incorporation or organization) Identification No.)
Bassett, Virginia 24055
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(Address of principal executive offices)
(Zip Code)
(540) 629-6000
(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS
On May 21, 1997, Bassett Furniture Industries, Inc., in
accordance with its recently announced strategy to focus on its core business
marketed under the Bassett brand name, announced a series of moves to
restructure its manufacturing operations. As a result, the Company is exiting
certain markets by closing its promotional Impact Furniture Division and by
eliminating the upper-end National/Mt. Airy Division. The Company will
restructure its manufacturing by closing the Company's W. M. Bassett
manufacturing facility in Martinsville, Va., and moving that plant's production
to the Company's Mt. Airy, N.C. facility as well as several plants in Bassett,
Va. As a result of these strategic changes, the Company will incur a $30.5
million pre-tax charge of which $22.4 million will occur in the second quarter
and $8.1 million over the remainder of the year. The total after-tax charge to
be taken in fiscal 1997 is $18.9 million, or $1.45 per share.
Robert H. Spilman, Jr., President and COO, said these changes
follow an extensive analysis of the Company's lines of business and the
strategic direction of the Company. "Bassett is going to focus on its core
Bassett line in order to improve our market share in residential home
furnishings. Further, we will be able to utilize our manufacturing capacity
better by retaining one of our best facilities, the Mt. Airy plant, to produce
our core line and eliminate one of our older, less efficient plants," Spilman
said. "From a community standpoint, we will be able to offer all of our hourly
W. M. Bassett employees positions at our other Bassett-area plants," he added.
The decision to close Impact Furniture is a result of the
promotional market moving more towards wood product, especially imported
products, and away from the non-wood product. This promotional segment is also
highly competitive and Impact has not been a market share leader in this
segment in recent years.
Similarly, the National/Mt. Airy product line was reviewed and
it was decided to eliminate the Division while retaining and integrating one
product into the Bassett line. The move will enable the Company to shift
production of key Bassett products to an excellent facility and improve
production efficiency.
These changes are expected to reduce annualized sales
approximately 10 percent but are expected to significantly improve operating
earnings.
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.
BASSETT FURNITURE INDUSTRIES, INCORPORATED
BY
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Philip E. Booker
Vice President and Controller
Date:
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