FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended September 28, 1996
Commission File Number 0-2585
DIXIE YARNS, INC.
(Exact name of registrant as specified in its charter)
Tennessee 62-0183370
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1100 South Watkins Street
Chattanooga, Tennessee 37404
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (423) 698-2501
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding as of October 29, 1996
Common Stock, $3 Par Value 10,468,194 shares
Class B Common Stock, $3 Par Value 735,228 shares
Class C Common Stock, $3 Par Value 0 shares
DIXIE YARNS, INC 2
INDEX
Part I. Financial Information: Page No.
Consolidated Condensed Balance Sheets --
September 28, 1996 and December 30, 1995 3
Consolidated Statements of Income --
Three Months Ended September 28, 1996
and September 30, 1995 5
Consolidated Statements of Income --
Nine Months ended September 28, 1996
and September 30, 1995 6
Consolidated Condensed Statements of Cash Flows --
Nine Months Ended September 28, 1996
and September 30, 1995 7
Notes to Consolidated Condensed Financial Statements 9
Management's Discussion and Analysis of Results of
Operations and Financial Condition 12
Part II. Other Information:
Item 6 - Exhibits and Reports on Form 8-K 15
PART I - ITEM 1 3
FINANCIAL INFORMATION
DIXIE YARNS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(UNAUDITED)
September 28, December 30,
1996 1995
_____________ ____________
(dollar amounts in thousands)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 2,190 $ 3,413
Accounts receivable (less allowance for
doubtful accounts of $3,434 in 1996
and $3,156 in 1995) 22,611 17,369
Inventories 92,764 103,253
Assets held for sale -- 22,090
Other 7,519 10,518
_____________ ____________
TOTAL CURRENT ASSETS 125,084 156,643
PROPERTY, PLANT AND EQUIPMENT 394,013 383,741
Less accumulated amortization and
depreciation 209,680 190,238
_____________ ____________
NET PROPERTY, PLANT AND EQUIPMENT 184,333 193,503
INTANGIBLE ASSETS (less accumulated
amortization of $6,749 in 1996
and $5,973 in 1995) 35,000 35,775
OTHER ASSETS 10,415 11,076
_____________ ____________
TOTAL ASSETS $ 354,832 $ 396,997
_____________ ____________
_____________ ____________
See Notes to Consolidated Condensed Financial Statements.
DIXIE YARNS, INC. 4
CONSOLIDATED CONDENSED BALANCE SHEETS
(UNAUDITED)
September 28, December 30,
1996 1995
_____________ ____________
(dollar amounts in thousands)
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 32,674 $ 20,394
Accrued expenses 24,591 23,294
Current portion of long-term debt 2,630 2,171
_____________ ____________
TOTAL CURRENT LIABILITIES 59,895 45,859
LONG-TERM DEBT
Senior indebtedness 39,113 97,383
Subordinated notes 50,000 50,000
Convertible subordinated debentures 44,782 44,782
_____________ ____________
TOTAL LONG-TERM DEBT 133,895 192,165
OTHER LIABILITIES 11,411 11,486
DEFERRED INCOME TAXES 28,948 29,197
STOCKHOLDERS' EQUITY
Common Stock - issued and outstanding,
13,876,826 shares in 1996 and
13,862,799 shares in 1995 41,630 41,588
Class B Common Stock - issued and
outstanding, 735,228 shares in 1996
and 1995 2,206 2,206
Common Stock Subscribed 1,348 --
Additional paid-in capital 132,475 131,618
Stock Subscriptions Receivable (2,190) --
Retained earnings 4,806 2,447
Minimum pension liability adjustment (4,116) (4,116)
_____________ ____________
176,159 173,743
Less Common Stock in treasury at cost -
3,408,532 shares in 1996 and
3,404,123 shares in 1995 55,476 55,453
_____________ ____________
TOTAL STOCKHOLDERS' EQUITY 120,683 118,290
_____________ ____________
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 354,832 $ 396,997
_____________ ____________
_____________ ____________
See Notes to Consolidated Condensed Financial Statements.
DIXIE YARNS, INC. 5
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Three Months Ended
______________________________
September 28, September 30,
1996 1995
_____________ _____________
(dollar amounts in thousands,
except per share data)
Net sales $ 145,400 $ 161,289
Cost of sales 120,442 137,894
_____________ _____________
GROSS PROFIT 24,958 23,395
Selling and administrative
expenses 16,824 21,346
Other (income) expense - net 1,682 6,894
_____________ _____________
INCOME (LOSS) BEFORE INTEREST AND TAXES 6,452 (4,845)
Interest expense 2,920 3,985
_____________ _____________
INCOME (LOSS) BEFORE INCOME TAXES 3,532 (8,830)
Income tax provision (benefit) 1,502 (2,800)
_____________ _____________
NET INCOME (LOSS) $ 2,030 $ (6,030)
_____________ _____________
_____________ _____________
Per common and common
equivalent share:
Net income (loss) $ .18 $ (.53)
See Notes to Consolidated Condensed Financial Statements.
DIXIE YARNS, INC. 6
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Nine Months Ended
______________________________
September 28, September 30,
1996 1995
_____________ _____________
(dollar amounts in thousands,
except per share data)
Net sales $ 474,882 $ 520,744
Cost of sales 395,235 442,625
_____________ _____________
GROSS PROFIT 79,647 78,119
Selling and administrative
expenses 57,430 63,947
Other (income) expense - net 6,662 7,916
_____________ _____________
INCOME BEFORE INTEREST AND TAXES 15,555 6,256
Interest expense 10,702 12,097
_____________ _____________
INCOME (LOSS) BEFORE INCOME TAXES 4,853 (5,841)
Income tax provision (benefit) 2,494 (1,125)
_____________ _____________
NET INCOME (LOSS) $ 2,359 $ (4,716)
_____________ _____________
_____________ _____________
Per common and common
equivalent share:
Net income (loss) $ .21 $ (.40)
See Notes to Consolidated Condensed Financial Statements.
DIXIE YARNS, INC. 7
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Nine Months Ended
______________________________
September 28, September 30,
1996 1995
_____________ _____________
(dollar amounts in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 2,359 $ (4,716)
Depreciation and amortization 21,561 27,527
Provision (benefit) for
deferred income taxes (154) 880
(Gain) loss on property, plant
and equipment (354) 9,058
_____________ _____________
23,412 32,749
Changes in operating assets and
liabilities 21,523 (16,638)
_____________ _____________
NET CASH PROVIDED BY
OPERATING ACTIVITIES 44,935 16,111
CASH FLOWS FROM INVESTING ACTIVITIES
Net proceeds from sale of
property, plant and equipment 23,590 6,359
Purchase of property, plant and
equipment (11,972) (24,750)
_____________ _____________
NET CASH PROVIDED BY (USED IN)
INVESTING ACTIVITIES 11,618 (18,391)
See Notes to Consolidated Condensed Financial Statements.
DIXIE YARNS, INC. 8
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
- CONTINUED
(UNAUDITED)
Nine Months Ended
______________________________
September 28, September 30,
1996 1995
_____________ _____________
(dollar amounts in thousands)
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase (decrease) in
credit line borrowings (55,675) 11,185
Borrowings (payments) under
term-loan facility (1,875) 10,000
Common stock acquired (23) (18,403)
Other (203) (416)
_____________ _____________
NET CASH PROVIDED BY (USED IN)
FINANCING ACTIVITIES (57,776) 2,366
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS (1,223) 86
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD 3,413 1,904
_____________ _____________
CASH AND CASH EQUIVALENTS AT END
OF PERIOD $ 2,190 $ 1,990
_____________ _____________
_____________ _____________
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid $ 11,397 $ 11,344
____________ _____________
____________ _____________
Tax refunds received, net
of income taxes paid $ (589) $ (1,248)
____________ _____________
____________ _____________
See Notes to Consolidated Condensed Financial Statements.
DIXIE YARNS, INC. 9
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited consolidated condensed financial statements have
been prepared in accordance with generally accepted accounting principles
for interim financial statements which do not include all of the
information and footnotes required in annual financial statements. In the
opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the three and nine months ended September 28, 1996
are not necessarily indicative of the results that may be expected for the
entire year.
NOTE B - INVENTORIES
Inventories are summarized as follows:
September 28, December 30,
1996 1995
_____________ ____________
(dollar amounts in thousands)
At current cost
Raw materials $ 21,843 $ 21,012
Work-in-process 23,625 24,441
Finished goods 57,614 73,314
Supplies, repair parts
and other 4,852 6,772
_____________ ____________
107,934 125,539
Excess of current cost
over LIFO value (15,170) (22,286)
_____________ ____________
$ 92,764 $ 103,253
_____________ ____________
_____________ ____________
The reduction of certain inventory quantities resulted in liquidations of
LIFO inventory quantities carried at lower costs prevailing in prior years.
The effect of these reductions (excluding thread inventory liquidations
discussed in Note E,) was to increase net income for the third quarter and
first nine months of 1996 by approximately $.6 million ($.05 per share) and
$.8 million ($.07 per share), respectively.
NOTE C - DEBT AND CREDIT ARRANGEMENTS
Under the terms of the Company's unsecured revolving credit and term-loan
agreement, revolving credit availability is permanently reduced by 50% of
the net cash proceeds from certain significant asset sales. Accordingly,
the revolving credit availability was reduced by $20.8 million as a result
of the sale of Threads USA on June 3, 1996. The net effect of the
availability reduction and debt repayments increased unused borrowing
capacity under the Company's revolving credit agreements from $38.8 million
at December 30, 1995 to $73.6 million at September 28, 1996.
10
NOTE D - COMMON STOCK SUBSCRIBED
In August 1996, the Company's Board of Directors adopted a stock ownership
plan applicable to the senior management of the Company for the purpose of
encouraging each participant to make a significant investment in the
Company's Common Stock. Pursuant to the plan, in September 1996, the
Company entered into stock subscription agreements with seven of the
Company's senior executive officers for the purchase of an aggregate of
449,300 shares at a price of $4.875 per share. The par value of the
subscribed shares was credited to Common Stock Subscribed with the excess
over par value credited to additional paid-in capital. The aggregate
receivable under the subscription agreements is reflected as a reduction
from total stockholders' equity.
NOTE E - SALE OF THE COMPANY'S THREADS USA BUSINESS
On June 3, 1996, the Company sold its Threads USA business, including
substantially all of its property, plant and equipment, raw material and
in-process inventories and certain other assets to American & Efird, Inc.
for $27.2 million cash. Under the terms of the asset purchase agreement:
(i) thread inventories retained by the Company were to be held for purchase
by American & Efird to service the Threads USA business; (ii) Threads USA's
branded product lines must be continued until the earlier of six months or
all such inventories are purchased from the Company; and (iii) the Company
is prohibited from competing in the thread business for a period of five
years. Accounts receivable associated with Threads USA were retained by
the Company. Net proceeds from these transactions were anticipated to
exceed $50.0 million. From the transaction date on June 3, 1996, through
the end of the third quarter of 1996, net proceeds were approximately $46.4
million, including collection of substantially all of the accounts
receivables and the sale of approximately sixty percent of the unit volumes
of inventories retained by the Company. Proceeds were used to reduce the
Company's outstanding long-term debt.
During the first nine months of 1996, operations of the thread business
generated sales of $51.1 million, including $10.5 million subsequent to
June 3, 1996 related to inventories retained by the Company. Results
included operating profits of $1.7 million during the first nine months of
1996. Revenues and costs subsequent to June 3, 1996 substantially offset
and included $5.0 million of LIFO inventory gains and approximately $4.4
million of costs to exit the Threads USA business. The exit costs
consisted primarily of severance costs and pension related settlement
expenses which, in accordance with GAAP, could not be recognized as part of
the valuation allowance recorded in 1995. These costs were classified in
"Other (income) expense-net" in the Company's consolidated statements of
income. The LIFO inventory gains resulted from liquidations of thread LIFO
inventory quantities carried at lower costs prevailing in prior years and
were reported as a reduction of costs of sales in the Company's
consolidated statements of income.
11
NOTE F - SUBSEQUENT EVENT
In October 1996, the Company signed a letter of intent to purchase for
$25.0 million cash, subject to certain working capital and other
adjustments, the business and operating assets of Danube Carpet Mills,
Inc., a subsidiary of Shelter Components Corporation. Danube is engaged
primarily in the business of manufacturing and selling carpet to the
manufactured housing and recreational vehicle industries and had 1995 sales
of approximately $69.0 million. The Company anticipates closing the
transaction on or about December 31, 1996 subject to regulatory approval,
due diligence review, and the execution of a definitive asset purchase
agreement.
PART I - ITEM 2 12
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL
CONDITION
The following is presented to update the discussion of results of
operations and financial condition included in the Company's 1995 Annual
Report.
Subsequent to the quarter ended September 28, 1996, the Company signed a
letter of intent to purchase for $25.0 million cash, subject to certain
working capital and other adjustments, the business and operating assets of
Danube Carpet Mills, Inc., a subsidiary of Shelter Components Corporation.
The transaction is subject to regulatory approval, due diligence review,
and the execution of a definitive asset purchase agreement. The Company
anticipates closing the transaction on or about December 31, 1996.
Danube, which had sales of approximately $69.0 million in 1995, is engaged
primarily in the business of manufacturing and selling carpet to the
manufactured housing and recreational vehicle industries. The Danube
acquisition and the mid-year 1996 disposition of the Company's thread
business represent a continuation of the Company's strategy to expand its
floorcovering business while concentrating on select, targeted markets in
the textile business.
RESULTS OF OPERATIONS
On June 3, 1996, the Company sold its Threads USA business, including
substantially all of its property, plant and equipment, raw material and
in-process inventories and certain other assets to American & Efird, Inc.
for $27.2 million cash. Under the terms of the asset purchase agreement:
(i) thread inventories retained by the Company were to be held for purchase
by American & Efird to service the Threads USA business; (ii) Threads USA's
branded product lines must be continued until the earlier of six months or
all such inventories are purchased from the Company; and (iii) the Company
is prohibited from competing in the thread business for a period of five
years. Accounts receivable associated with Threads USA were retained by
the Company. Net proceeds from these transactions were anticipated to
exceed $50.0 million. From the transaction date on June 3, 1996, through
the end of the third quarter of 1996, net proceeds were approximately $46.4
million, including collection of substantially all of the accounts
receivables and the sale of approximately sixty percent of the unit volumes
of inventories retained by the Company. Proceeds were used to reduce the
Company's outstanding long-term debt.
The Company's operations included thread sales of $5.5 million in the third
quarter of 1996 and $51.1 million for the first nine months of 1996,
including $10.5 million subsequent to June 3, 1996 related to inventories
retained by the Company. Results included an operating loss of $.1 million
in the third quarter of 1996 and an operating profit of $1.7 million for
the first nine months of 1996. Revenues and costs subsequent to June 3,
1996 substantially offset and included $5.0 million of LIFO inventory gains
and approximately $4.4 million of costs to exit the Threads USA business.
The exit costs consisted primarily of severance costs and pension related
settlement expenses which, in accordance with GAAP, could not be recognized
as part of the valuation allowance recorded in 1995. These costs were
classified in "Other (income) expense-net" in the Company's consolidated
statements of income. The LIFO inventory gains resulted from liquidations
13
of thread LIFO inventory quantities carried at lower costs prevailing in
prior years and were reported as a reduction of costs of sales in the
Company's consolidated statements of income.
The following table sets forth selected operating data (in millions of
dollars) related to the two business segments of the Company:
Floorcovering and Textile Products.
Quarter Ended Nine Months Ended
Sept 28, Sept 30, Sept 28, Sept 30,
1996 1995 1996 1995
SALES
Floorcovering $ 93.3 $ 88.7 $277.5 $275.2
Textile products 52.6 74.0 200.1 248.8
Intersegment elimination (0.5) (1.5) (2.7) (3.3)
Total sales $145.4 $161.2 $474.9 $520.7
OPERATING PROFIT (LOSS)
Floorcovering
Excluding unusual items $ 7.4 $ 4.1 $ 18.3 $ 15.6
Unusual items -- 1.2 -- 4.1
Floorcovering total 7.4 5.3 18.3 19.7
Textile products
Excluding unusual items 0.2 (1.9) 1.2 (0.6)
Unusual items -- (7.0) -- (8.8)
Textile products total 0.2 (8.9) 1.2 (9.4)
Combined
Excluding unusual items 7.6 2.2 19.5 15.0
Unusual items -- (5.8) -- (4.7)
Company total $ 7.6 $ (3.6) $ 19.5 $ 10.3
Unusual items in floorcovering included casualty insurance gains of $1.2
million and $4.1 million for the quarter and nine months ended September
30, 1995, respectively. Unusual items in textile products included a $1.1
million casualty insurance gain and an $8.1 million charge for the sale of
a facility during the quarter and nine months ended September 28, 1995.
Textile products also included a $1.8 million facilities consolidation
charge in the nine months ended September 28, 1995.
The decline in sales in the Company's textile products segment for the
first nine months of 1996 compared with the first nine months of 1995
occurred as a result of decreased sales of lower margin commodity products
and the sale of the Company's Threads USA business on June 3, 1996. The
facilities consolidation and sale of an open-end cotton yarn plant in 1995
were part of the Company's strategy to decrease production of lower margin
commodity products. The Company's sales decline in the quarter ended
September 28, 1996, compared with the quarter ended September 30, 1995,
resulted primarily from the Threads USA sale.
14
Excluding unusual items in 1995, operating profits in the Company's
floorcovering business improved $3.3 million in the third quarter of 1996
and $2.7 million in year-to-date 1996 compared with the corresponding 1995
periods. The improved results are principally due to favorable mix toward
higher margin products, manufacturing costs reductions, lower selling
expenses and inventory liquidation gains of $1.0 million and $1.2 included
in the quarter and nine months ended September 28, 1996, respectively.
Excluding unusual items in 1995, operating results in the Company's textile
operations improved $2.1 million and $1.8 million in the quarter and nine
months ended September 28, 1996, respectively, compared with the
corresponding 1995 periods. The improved textile earnings reflect the
shift to higher margin products and reductions in selling and
administrative expenses.
Interest expense decreased in both the third quarter and the first nine
months of 1996, compared with the corresponding 1995 periods as a result of
substantially lower debt levels in 1996.
LIQUIDITY AND CAPITAL RESOURCES
During the nine months ended September 28, 1996, operating activities
generated funds of $44.9 million (including $22.8 million of working
capital reduction associated with the sale of Threads) while net proceeds
from the sale of property, plant and equipment (primarily the assets of
Threads USA) provided additional funds of $23.6 million. These funds were
used to reduce the Company's outstanding long-term debt by $57.8 million
and to finance capital expenditures of $12.0 million.
Under the terms of the Company's unsecured revolving credit and term-loan
agreement, revolving credit availability is permanently reduced by 50% of
the net cash proceeds from certain significant asset sales. Accordingly,
the revolving credit availability was reduced by $20.8 million as a result
of the sale of Threads USA on June 3, 1996. The net effect of the
availability reduction and debt repayments increased unused borrowing
capacity under the Company's revolving credit agreements from $38.8 million
at December 30, 1995 to $73.6 million at September 28, 1996.
Operating cash flows for the remainder of the year are currently expected
to exceed the Company's liquidity requirements, including planned capital
expenditures. The acquisition of Danube is expected to be funded by
operating cash flows and borrowings under the Company's revolving credit
line.
PART II. OTHER INFORMATION 15
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits
(i) Exhibits Incorporated by Reference
None.
(ii) Exhibits Filed with this Report
(11) Statement re: Computation of Earnings Per Share.
(b) Reports on Form 8-K
Current Report on Form 8-K, dated September 9, 1996, reporting
subscriptions for 449,300 shares of the Company's Common Stock by
seven of the Company's senior executive officers.
16
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.
DIXIE YARNS, INC.
__________________________
(Registrant)
November 7, 1996
____________________
(Date)
/s/DANIEL K. FRIERSON
__________________________
Daniel K. Frierson
Chairman of the Board,
President and CEO
/s/D. EUGENE LASATER
__________________________
D. Eugene Lasater
Controller
QUARTERLY REPORT ON FORM 10-Q 17
ITEM 6(a)
EXHIBITS
QUARTER ENDED SEPTEMBER 28, 1996
DIXIE YARNS, INC.
CHATTANOOGA, TENNESSEE
Exhibit Index
EXHIBIT
NO. EXHIBIT DESCRIPTION INCORPORATION BY REFERENCE
(11) Statement re: Computation Filed herewith.
of Earnings Per Share.
EXHIBIT (11)
EXHIBIT 11
DIXIE YARNS, INC.
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
(amounts in thousands, except per share data)
Three Months Ended Nine Months Ended
___________________ ___________________
Sept 28, Sept 30, Sept 28, Sept 30,
1996 1995 1996 1995
________ ________ ________ ________
PRIMARY:
NET INCOME (LOSS) $ 2,030 $ (6,030) $ 2,359 $ (4,716)
________ ________ ________ ________
________ ________ ________ ________
Weighted average number of
Common Shares outstanding
assuming conversion of
Class B Common Stock 11,202 11,293 11,200 11,927
Net effect of dilutive stock
options based on the
treasury stock method using
average market price 4 -0- 4 -0-
________ ________ ________ ________
TOTAL SHARES 11,206 11,293 11,204 11,927
________ ________ ________ ________
________ ________ ________ ________
PER SHARE AMOUNT $ .18 $ (.53) $ .21 $ (.40)
________ ________ ________ ________
________ ________ ________ ________
FULLY DILUTED:
Net income (loss) $ 2,030 $ (6,030) $ 2,359 $ (4,716)
After-tax interest
requirement of
convertible subordinated
debentures (A) -0- -0- -0- -0-
________ ________ ________ ________
ADJUSTED NET INCOME (LOSS) 2,030 $ (6,030) $ 2,359 $ (4,716)
________ ________ ________ ________
________ ________ ________ ________
EXHIBIT 11
DIXIE YARNS, INC.
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE - CONTINUED
Three Months Ended Nine Months Ended
___________________ ___________________
Sept 28, Sept 30, Sept 28, Sept 30,
1996 1995 1996 1995
________ ________ ________ ________
FULLY DILUTED - CONTINUED:
Weighted average number of
Common Shares outstanding
assuming conversion of
Class B Common Stock 11,202 11,293 11,200 11,927
Net effect of dilutive stock
options based on the
treasury stock method using
quarter end market price
if higher than the average
market price 5 -0- 5 -0-
Net effect of conversion of
convertible subordinated
debentures (A) -0- -0- -0- -0-
________ ________ ________ ________
TOTAL SHARES 11,207 11,293 11,205 11,297
________ ________ ________ ________
________ ________ ________ ________
PER SHARE AMOUNT $ .18 $ (.53) $ .21 $ (.40)
________ ________ ________ ________
________ ________ ________ ________
(A) Conversion of convertible subordinated debentures to 1,391 shares with
an after-tax interest requirement of $473 for the three months ended
September 28, 1996 and September 30, 1995, respectively and of $1,418 for
the nine months ended September 28, 1996 and September 30, 1995,
respectively has been excluded from computation since the effect was anti-
dilutive.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED CONDENSED FINANCIAL STATEMENTS OF DIXIE YARNS, INC. AT AND
FOR THE NINE MONTHS ENDED SEPTEMBER 28, 1996 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-28-1996
<PERIOD-END> SEP-28-1996
<CASH> 2,190
<SECURITIES> 0
<RECEIVABLES> 26,045
<ALLOWANCES> 3,434
<INVENTORY> 92,764
<CURRENT-ASSETS> 125,084
<PP&E> 394,013
<DEPRECIATION> 209,680
<TOTAL-ASSETS> 354,832
<CURRENT-LIABILITIES> 59,895
<BONDS> 133,895
<COMMON> 43,836
0
0
<OTHER-SE> 76,847
<TOTAL-LIABILITY-AND-EQUITY> 354,832
<SALES> 474,882
<TOTAL-REVENUES> 474,882
<CGS> 395,235
<TOTAL-COSTS> 395,235
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 10,702
<INCOME-PRETAX> 4,853
<INCOME-TAX> 2,494
<INCOME-CONTINUING> 2,359
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,359
<EPS-PRIMARY> 0.21
<EPS-DILUTED> 0.21
</TABLE>
