Standard Brands Posts $3.9-Million Loss

Standard Brands Paint Co. said Thursday that it lost $3.9 million on an 8% decline in sales in its second quarter ended July 29.

Citing a sluggish economy, the Torrance-based retailer also said it closed most of its Texas stores and some operations in California--dismissing 220 workers--to improve its cash flow and earnings. Included in the second-quarter loss is a $4.7-million restructuring charge associated with store closings, the company said. The restructuring cost includes a “comprehensive” assistance program for laid-off workers, Standard Brands said.

For the quarter, the company reported sales of $79.9 million, down from $87.5 million in the year-ago period.

It said it had a net loss of $4.9 million on sales of $152.6 million for the six-month period ending in July. Year-ago sales for the first six months were $163.4 million.

The closed operations included 16 home decorating stores and a distribution center in Texas. The Texas operations were suffering because of a weak local economy, the company said.

The California units closed were small operations in Merced, Chico and Redding.

“Steps are being taken to sell the closed Texas stores and the Dallas distribution center, with the anticipated proceeds to be utilized to repay long-term debt now at $150 million,” Chief Executive Stuart D. Buchalter said.

After the restructuring, the company said, it will concentrate on the West Coast, opening stores in “proven marketing areas” with a particular emphasis on home decorating outlets.

Standard Brands operates more than 100 stores--with some 3,500 employees-- primarily in California, Washington, Arizona, Nevada and New Mexico. In the next four years, the company said, it plans to open stores in California, Las Vegas and Phoenix.