Benzinga | May 11, 2021 09:32AM EDT

Crown Crafts Announces Closing Of Carousel Designs

Crown Crafts, Inc. (NASDAQ:CRWS) (the "Company") announced today that it is closing the operations of its Carousel Designs, LLC, subsidiary, effective May 21, 2021. The Carousel Designs manufacturing facility in Douglasville, Georgia, and its direct-to-consumer website, www.babybedding.com, will cease operations on that date.



The Company decided to close Carousel Designs due to high costs, declining sales and continued losses associated with the subsidiary. Net sales for Carousel Designs declined from $6.6 million in fiscal year 2019 to $4.8 million in fiscal year 2020, the most recently reported full fiscal year. Crown Crafts' consolidated diluted earnings per share without Carousel Designs would have been higher by $0.06 and $0.04 in fiscal years 2019 and 2020, respectively.

"We regret that we have had to make this difficult decision, but it is in the best interests of all of our stakeholders as we continue to manage Crown Crafts with a focus on long-term profitability and expense control," said E. Randall Chestnut, Chairman and Chief Executive Officer of Crown Crafts.

The Company expects to record charges totaling $2.8 million to $3.4 million in fiscal years 2021 and 2022, most of which will be non-cash charges associated with the impairment of long-lived assets.

Carousel Designs will work to fulfill any customer orders placed prior to the closing date. Any customers whose orders cannot be fulfilled will receive full refunds.