Krause’s Posts Loss, Files to Sell 4.4 Million Shares

Krause’s Furniture Inc. reported on Wednesday its fifth consecutive annual loss as it filed documents with the Securities and Exchange Commission to sell 4.4 million shares of its stock.

The furniture maker and retailer said it lost $7.5 million, or 39 cents a share, for its fiscal year, which ended Feb. 1. The results were much improved over a net loss of $13.4 million, or $1.28 a share, for the previous year. Sales rose 2% to $115.2 million from $112.7 million.

The company has been on an aggressive showroom remodeling and revitalizing plan for the last year.

Krause’s said its fourth-quarter results were affected by the inability of one of its major suppliers to meet demand for its popular fabrics.

Krause’s lost $1.9 million, or 10 cents a share, for its fiscal fourth quarter, which ended Feb. 1. The red ink is nearly double the loss of $1 million, or 5 cents a share, for last year’s final three months. Quarterly sales fell 1% to $29.6 million from $30 million.

In its SEC filing, the Brea company, which has an accumulated deficit of $41.8 million, said its public offering will consist of 2.3 million newly issued shares from the company and 2.1 million shares offered by a selling shareholder.

The company will use its share of the net proceeds, expected to be about $5.7 million if the stock sells at $3 a share, to fund the remodeling of existing showrooms and to open 20 new ones.

Japan Omnibus Ltd., a British Virgin Islands investment firm that owns 12% of Krause’s, is the sole selling shareholder. It will retain 300,000 shares, or 1.4% of the company, after the sale.