Tennessee
|
|
62-0183370
|
(State or other jurisdiction of incorporation of organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
|
475 Reed Road, Dalton, GA 30720
|
|
(706) 876-5800
|
(Address of principal executive offices and zip code)
|
|
(Registrant's telephone number, including area code)
|
|
|
|
Securities registered pursuant to Section 12(b) of the Act:
|
|
|
Title of Class
|
|
Name of each exchange on which registered
|
Common Stock, $3.00 par value
|
|
NASDAQ Stock Market, LLC
|
|
|
|
Securities registered pursuant to Section 12(g) of the Act:
|
|
|
Title of class
|
|
|
None
|
|
|
Class
|
|
Outstanding as of February 23, 2018
|
|||
Common Stock, $3.00 Par Value
|
|
15,279,812
|
|
|
shares
|
Class B Common Stock, $3.00 Par Value
|
|
861,499
|
|
|
shares
|
Class C Common Stock, $3.00 Par Value
|
|
0
|
|
|
shares
|
PART I
|
Page
|
|
Item 1.
|
||
Item 1A.
|
||
Item 1B.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
||
PART II
|
|
|
Item 5.
|
||
Item 6.
|
||
Item 7.
|
||
Item 7A.
|
||
Item 8.
|
||
Item 9.
|
||
Item 9A.
|
||
Item 9B.
|
||
PART III
|
|
|
Item 10.
|
||
Item 11.
|
||
Item 12.
|
||
Item 13.
|
||
Item 14.
|
||
PART IV
|
|
|
Item 15.
|
||
Item 16.
|
||
|
||
|
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
Item 1.
|
BUSINESS
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
Residential floorcovering products
|
68
|
%
|
|
66
|
%
|
|
64
|
%
|
Commercial floorcovering products
|
32
|
%
|
|
34
|
%
|
|
36
|
%
|
1.
|
annual reports on Form 10-K;
|
2.
|
quarterly reports on Form 10-Q;
|
3.
|
current reports on Form 8-K; and
|
4.
|
amendments to the foregoing reports.
|
•
|
Discharge to air and water;
|
•
|
Handling and disposal of solid and hazardous substances and waste, and
|
•
|
Remediation of contamination from releases of hazardous substances in our facilities and off-site disposal locations.
|
Item 1B.
|
UNRESOLVED STAFF COMMENTS
|
Item 2.
|
PROPERTIES
|
Location
|
|
Type of Operation
|
|
Approximate Square Feet
|
|
Administrative:
|
|
|
|
|
|
Saraland, AL
|
|
Administrative
|
|
29,000
|
|
Commerce, CA*
|
|
Administrative
|
|
21,800
|
|
Santa Ana, CA
|
|
Administrative
|
|
4,000
|
|
Calhoun, GA
|
|
Administrative
|
|
10,600
|
|
Dalton, GA*
|
|
Administrative
|
|
47,900
|
|
Chattanooga, TN*
|
|
Administrative
|
|
3,500
|
|
|
|
Total Administrative
|
|
116,800
|
|
|
|
|
|
|
|
Manufacturing and Distribution:
|
|
|
|||
Atmore, AL
|
|
Carpet Manufacturing, Distribution
|
|
610,000
|
|
Roanoke, AL
|
|
Carpet Yarn Processing
|
|
204,000
|
|
Saraland, AL
|
|
Carpet, Rug and Tile Manufacturing, Distribution
|
|
384,000
|
|
Commerce, CA*
|
|
Carpet Manufacturing, Distribution
|
|
232,800
|
|
Porterville, CA*
|
|
Carpet Yarn Processing
|
|
249,000
|
|
Santa Ana, CA
|
|
Carpet and Rug Manufacturing, Distribution
|
|
200,000
|
|
Adairsville, GA
|
|
Samples and Rug Manufacturing, Distribution
|
|
292,000
|
|
Calhoun, GA *
|
|
Distribution
|
|
99,000
|
|
Calhoun, GA
|
|
Carpet Dyeing & Processing
|
|
193,300
|
|
Chickamauga, GA*
|
|
Carpet Manufacturing
|
|
107,000
|
|
Eton, GA
|
|
Carpet Manufacturing, Distribution
|
|
408,000
|
|
|
|
Total Manufacturing and Distribution
|
|
2,979,100
|
|
|
|
|
|
|
|
* Leased properties
|
|
TOTAL
|
|
3,095,900
|
|
Item 3.
|
LEGAL PROCEEDINGS
|
Item 4.
|
MINE SAFETY DISCLOSURES
|
Name, Age and Position
|
|
Business Experience During Past Five Years
|
|
|
|
Daniel K. Frierson, 76
Chairman of the Board, and Chief Executive Officer, Director
|
|
Director since 1973, Chairman of the Board since 1987 and Chief Executive Officer since 1980. He is the Chairman of the Company's Executive Committee. He is past Chairman of The Carpet and Rug Institute. He serves as Director of Astec Industries, Inc. headquartered in Chattanooga, Tennessee; and Louisiana-Pacific Corporation headquartered in Nashville, Tennessee.
|
|
|
|
D. Kennedy Frierson, Jr., 50
Vice President and Chief Operating Officer, Director
|
|
Director since 2012 and Vice President and Chief Operating Officer since August 2009. Vice President and President Masland Residential from February 2006 to July 2009. President Masland Residential from December 2005 to January 2006. Executive Vice President and General Manager, Dixie Home, 2003 to 2005. Business Unit Manager, Bretlin, 2002 to 2003.
|
|
|
|
Jon A. Faulkner, 57
Vice President and Chief Financial Officer
|
|
Vice President and Chief Financial Officer since October 2009. Vice President of Planning and Development from February 2002 to September 2009. Executive Vice President of Sales and Marketing for Steward, Inc. from 1997 to 2002.
|
|
|
|
Thomas M. Nuckols, 50
Vice President and President, Dixie Residential
|
|
Vice President and President of Dixie Residential since November 2017. Executive Vice President, Dixie Residential from February 2017 to November 2017. Dupont/Invista, from 1989 to 2017, Senior Director of Mill Sales and Product Strategy from 2015 to 2017.
|
|
|
|
E. David Hobbs, 66
Vice President and President, Dixie Commercial
|
|
Vice President and President of Dixie Commercial since October 2017. President, Masland Contract from September 2016 to October 2017. Executive President of Operations, Masland Contract from 2012 to September 2016. Vice President of Planning, Mohawk Industries from 2010 to 2011, Interface Americas from 1984 to 2010, President, Interface Americas from 2005 to 2009.
|
|
|
|
W. Derek Davis, 67
Vice President, Human Resources and Corporate Secretary
|
|
Vice President of Human Resources since January 1991 and Corporate Secretary since January 2016. Corporate Employee Relations Director, 1988 to 1991.
|
Item 5.
|
MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
|
|
|
|
|
|
|
|
|
||||||
Fiscal Month Ending
|
|
Total Number of Shares Purchased
|
|
Average Price Paid Per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number (or approximate dollar value) of Shares That May Yet Be Purchased Under Plans or Programs
|
||||||
November 4, 2017
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
|
||
December 2, 2017
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||
December 30, 2017
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||
Three Fiscal Months Ended December 30, 2017
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
2,228,266
|
|
THE DIXIE GROUP, INC.
|
||||||||||||||||
QUARTERLY FINANCIAL DATA, DIVIDENDS AND PRICE RANGE OF COMMON STOCK
|
||||||||||||||||
(unaudited) (dollars in thousands, except per share data)
|
||||||||||||||||
2017
|
|
1ST
|
|
2ND
|
|
3RD
|
|
4TH
|
||||||||
Net sales
|
|
$
|
97,541
|
|
|
$
|
107,187
|
|
|
$
|
102,650
|
|
|
$
|
105,084
|
|
Gross profit
|
|
25,161
|
|
|
28,426
|
|
|
24,857
|
|
|
22,769
|
|
||||
Operating income (loss)
|
|
628
|
|
|
3,179
|
|
|
767
|
|
|
(608
|
)
|
||||
Income (loss) from continuing operations
|
|
(575
|
)
|
|
1,226
|
|
|
(547
|
)
|
|
(9,427
|
)
|
||||
Loss from discontinued operations
|
|
(29
|
)
|
|
(123
|
)
|
|
(11
|
)
|
|
(69
|
)
|
||||
Net income (loss)
|
|
$
|
(604
|
)
|
|
$
|
1,103
|
|
|
$
|
(558
|
)
|
|
$
|
(9,496
|
)
|
Basic earnings (loss) per share:
|
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
|
$
|
(0.04
|
)
|
|
$
|
0.08
|
|
|
$
|
(0.03
|
)
|
|
$
|
(0.60
|
)
|
Discontinued operations
|
|
(0.00
|
)
|
|
(0.01
|
)
|
|
(0.00
|
)
|
|
(0.00
|
)
|
||||
Net income (loss)
|
|
$
|
(0.04
|
)
|
|
$
|
0.07
|
|
|
$
|
(0.03
|
)
|
|
$
|
(0.60
|
)
|
Diluted earnings (loss) per share:
|
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
|
$
|
(0.04
|
)
|
|
$
|
0.08
|
|
|
$
|
(0.03
|
)
|
|
$
|
(0.60
|
)
|
Discontinued operations
|
|
(0.00
|
)
|
|
(0.01
|
)
|
|
(0.00
|
)
|
|
(0.00
|
)
|
||||
Net income (loss)
|
|
$
|
(0.04
|
)
|
|
$
|
0.07
|
|
|
$
|
(0.03
|
)
|
|
$
|
(0.60
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Common Stock Prices:
|
|
|
|
|
|
|
|
|
||||||||
High
|
|
$
|
3.95
|
|
|
$
|
5.21
|
|
|
$
|
4.75
|
|
|
$
|
4.30
|
|
Low
|
|
3.35
|
|
|
3.30
|
|
|
3.75
|
|
|
3.40
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
2016
|
|
1ST
|
|
2ND
|
|
3RD
|
|
4TH (1)
|
||||||||
Net sales
|
|
$
|
89,234
|
|
|
$
|
105,316
|
|
|
$
|
100,297
|
|
|
$
|
102,606
|
|
Gross profit
|
|
19,506
|
|
|
28,242
|
|
|
25,831
|
|
|
21,846
|
|
||||
Operating income (loss)
|
|
(5,840
|
)
|
|
3,403
|
|
|
1,916
|
|
|
(2,894
|
)
|
||||
Income (loss) from continuing operations
|
|
(4,757
|
)
|
|
1,615
|
|
|
573
|
|
|
(2,638
|
)
|
||||
Loss from discontinued operations
|
|
(10
|
)
|
|
(3
|
)
|
|
(39
|
)
|
|
(79
|
)
|
||||
Income (loss) on disposal of discontinued operations
|
|
—
|
|
|
65
|
|
|
—
|
|
|
(5
|
)
|
||||
Net income (loss)
|
|
$
|
(4,767
|
)
|
|
$
|
1,677
|
|
|
$
|
534
|
|
|
$
|
(2,722
|
)
|
Basic earnings (loss) per share:
|
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
|
$
|
(0.30
|
)
|
|
$
|
0.10
|
|
|
$
|
0.04
|
|
|
$
|
(0.17
|
)
|
Discontinued operations
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
(0.01
|
)
|
||||
Disposal of discontinued operations
|
|
—
|
|
|
0.00
|
|
|
—
|
|
|
(0.00
|
)
|
||||
Net income (loss)
|
|
$
|
(0.30
|
)
|
|
$
|
0.10
|
|
|
$
|
0.04
|
|
|
$
|
(0.18
|
)
|
Diluted earnings (loss) per share:
|
|
|
|
|
|
|
|
|
||||||||
Continuing operations
|
|
$
|
(0.30
|
)
|
|
$
|
0.10
|
|
|
$
|
0.04
|
|
|
$
|
(0.17
|
)
|
Discontinued operations
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
(0.00
|
)
|
|
(0.01
|
)
|
||||
Disposal of discontinued operations
|
|
—
|
|
|
0.00
|
|
|
—
|
|
|
(0.00
|
)
|
||||
Net income (loss)
|
|
$
|
(0.30
|
)
|
|
$
|
0.10
|
|
|
$
|
0.04
|
|
|
$
|
(0.18
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Common Stock Prices:
|
|
|
|
|
|
|
|
|
||||||||
High
|
|
$
|
5.66
|
|
|
$
|
4.89
|
|
|
$
|
5.15
|
|
|
$
|
5.56
|
|
Low
|
|
3.25
|
|
|
3.00
|
|
|
3.15
|
|
|
3.20
|
|
Item 6.
|
SELECTED FINANCIAL DATA
|
The Dixie Group, Inc.
|
||||||||||||||||||||
Historical Summary
|
||||||||||||||||||||
(dollars in thousands, except share and per share data)
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
FISCAL YEARS
|
|
2017 (1)
|
|
2016 (2)
|
|
2015 (3)
|
|
2014 (4)(5)
|
|
2013 (6)
|
||||||||||
OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales
|
|
$
|
412,462
|
|
|
$
|
397,453
|
|
|
$
|
422,483
|
|
|
$
|
406,588
|
|
|
$
|
344,374
|
|
Gross profit
|
|
101,213
|
|
|
95,425
|
|
|
106,230
|
|
|
95,497
|
|
|
85,570
|
|
|||||
Operating income (loss)
|
|
3,965
|
|
|
(3,415
|
)
|
|
1,990
|
|
|
(5,236
|
)
|
|
8,855
|
|
|||||
Income (loss) from continuing operations before taxes
|
|
(1,813
|
)
|
|
(8,829
|
)
|
|
(2,992
|
)
|
|
1,726
|
|
|
4,979
|
|
|||||
Income tax provision (benefit)
|
|
7,509
|
|
|
(3,622
|
)
|
|
(714
|
)
|
|
1,053
|
|
|
(577
|
)
|
|||||
Income (loss) from continuing operations
|
|
(9,322
|
)
|
|
(5,207
|
)
|
|
(2,278
|
)
|
|
673
|
|
|
5,556
|
|
|||||
Depreciation and amortization
|
|
12,947
|
|
|
13,515
|
|
|
14,119
|
|
|
12,850
|
|
|
10,230
|
|
|||||
Dividends
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Capital expenditures
|
|
12,724
|
|
|
4,904
|
|
|
6,826
|
|
|
9,492
|
|
|
11,438
|
|
|||||
Assets purchased under capital leases & notes, including deposits utilized and accrued purchases
|
|
859
|
|
|
427
|
|
|
5,403
|
|
|
23,333
|
|
|
1,865
|
|
|||||
FINANCIAL POSITION
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
|
$
|
282,838
|
|
|
$
|
268,987
|
|
|
$
|
298,218
|
|
|
$
|
290,447
|
|
|
$
|
243,557
|
|
Working capital
|
|
105,113
|
|
|
81,727
|
|
|
98,632
|
|
|
100,602
|
|
|
89,057
|
|
|||||
Long-term debt
|
|
123,446
|
|
|
98,256
|
|
|
115,907
|
|
|
117,153
|
|
|
100,521
|
|
|||||
Stockholders' equity
|
|
79,263
|
|
|
87,122
|
|
|
90,804
|
|
|
92,977
|
|
|
70,771
|
|
|||||
PER SHARE
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
$
|
(0.59
|
)
|
|
$
|
(0.33
|
)
|
|
$
|
(0.15
|
)
|
|
$
|
0.03
|
|
|
$
|
0.42
|
|
Diluted
|
|
(0.59
|
)
|
|
(0.33
|
)
|
|
(0.15
|
)
|
|
0.03
|
|
|
0.42
|
|
|||||
Dividends:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Common Stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Class B Common Stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Book value
|
|
4.91
|
|
|
5.40
|
|
|
5.67
|
|
|
5.90
|
|
|
5.32
|
|
|||||
GENERAL
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
|
15,698,915
|
|
|
15,638,112
|
|
|
15,535,980
|
|
|
14,381,601
|
|
|
12,736,835
|
|
|||||
Diluted
|
|
15,698,915
|
|
|
15,638,112
|
|
|
15,535,980
|
|
|
14,544,073
|
|
|
12,851,917
|
|
|||||
Number of shareholders (7)
|
|
2,800
|
|
|
3,000
|
|
|
3,000
|
|
|
3,000
|
|
|
2,350
|
|
|||||
Number of associates
|
|
1,930
|
|
|
1,746
|
|
|
1,822
|
|
|
1,740
|
|
|
1,423
|
|
(1)
|
Includes expenses of $636, or $404 net of tax, for facility consolidation and severance expenses in 2017.
|
(2)
|
Includes expenses of $1,456, or $859 net of tax, for facility consolidation expenses in 2016.
|
(3)
|
Includes expenses of $2,946, or $1,915 net of tax, for facility consolidation expenses in 2015.
|
(4)
|
Includes the results of operations of Atlas Carpet Mills, Inc. and Burtco Enterprises, Inc. subsequent to their acquisitions on March 19, 2014 and September 22, 2014, respectively.
|
(5)
|
Includes expenses of $5,514, or $3,364 net of tax, for facility consolidation expenses, $1,133, or $691 net of tax, for impairment of assets and income of $11,110, or $6,777 net of tax, for bargain purchases on the acquisitions of Atlas Carpet Mills and Burtco Enterprises.
|
(6)
|
Includes the results of operations of Robertex, Inc subsequent to its acquisition on June 30, 2013.
|
(7)
|
The approximate number of record holders of our Common Stock for 2013 through 2017 includes Management's estimate of shareholders who held our Common Stock in nominee names as follows: 2013 - 1,900 shareholders; 2014 - 2,550 shareholders; 2015 - 2,550 shareholders; 2016 - 2,600 shareholders; 2017 - 2,400 shareholders.
|
|
Fiscal Year Ended (amounts in thousands)
|
|
|
|
|||||||||||||
|
December 30, 2017
|
% of Net Sales
|
|
December 31, 2016
|
% of Net Sales
|
|
Increase (Decrease)
|
% Change
|
|||||||||
Net sales
|
$
|
412,462
|
|
100.0
|
%
|
|
$
|
397,453
|
|
100.0
|
%
|
|
$
|
15,009
|
|
3.8
|
%
|
Cost of sales
|
311,249
|
|
75.5
|
%
|
|
302,028
|
|
76.0
|
%
|
|
9,221
|
|
3.1
|
%
|
|||
Gross profit
|
101,213
|
|
24.5
|
%
|
|
95,425
|
|
24.0
|
%
|
|
5,788
|
|
6.1
|
%
|
|||
Selling and administrative expenses
|
96,171
|
|
23.3
|
%
|
|
96,983
|
|
24.4
|
%
|
|
(812
|
)
|
(0.8
|
)%
|
|||
Other operating expense, net
|
441
|
|
0.1
|
%
|
|
401
|
|
0.1
|
%
|
|
40
|
|
10.0
|
%
|
|||
Facility consolidation and severance expenses, net
|
636
|
|
0.2
|
%
|
|
1,456
|
|
0.4
|
%
|
|
(820
|
)
|
(56.3
|
)%
|
|||
Operating income (loss)
|
3,965
|
|
0.9
|
%
|
|
(3,415
|
)
|
(0.9
|
)%
|
|
7,380
|
|
(216.1
|
)%
|
|||
Interest expense
|
5,739
|
|
1.4
|
%
|
|
5,392
|
|
1.4
|
%
|
|
347
|
|
6.4
|
%
|
|||
Other expense, net
|
39
|
|
—
|
%
|
|
22
|
|
—
|
%
|
|
17
|
|
77.3
|
%
|
|||
Loss before taxes
|
(1,813
|
)
|
(0.5
|
)%
|
|
(8,829
|
)
|
(2.3
|
)%
|
|
7,016
|
|
(79.5
|
)%
|
|||
Income tax provision (benefit)
|
7,509
|
|
1.8
|
%
|
|
(3,622
|
)
|
(0.9
|
)%
|
|
11,131
|
|
(307.3
|
)%
|
|||
Loss from continuing operations
|
(9,322
|
)
|
(2.3
|
)%
|
|
(5,207
|
)
|
(1.4
|
)%
|
|
(4,115
|
)
|
79.0
|
%
|
|||
Loss from discontinued operations
|
(233
|
)
|
(0.1
|
)%
|
|
(131
|
)
|
—
|
%
|
|
(102
|
)
|
77.9
|
%
|
|||
Income on disposal of discontinued operations
|
—
|
|
—
|
%
|
|
60
|
|
—
|
%
|
|
(60
|
)
|
—
|
%
|
|||
Net loss
|
$
|
(9,555
|
)
|
(2.4
|
)%
|
|
$
|
(5,278
|
)
|
(1.4
|
)%
|
|
$
|
(4,277
|
)
|
81.0
|
%
|
|
Fiscal Year Ended (amounts in thousands)
|
|
||||||||||||||||
|
Net Sales December 30, 2017
|
|
Net Sales December 31, 2016
|
Week 53
|
Net Sales as Adjusted December 31, 2016
|
Increase (Decrease)
|
Net Sales as Adjusted % Change
|
|||||||||||
Net sales as adjusted
|
$
|
412,462
|
|
|
$
|
397,453
|
|
$
|
(5,380
|
)
|
$
|
392,073
|
|
$
|
20,389
|
|
5.2
|
%
|
|
Fiscal Year Ended (amounts in thousands)
|
|
|
|
|||||||||||||
|
December 31, 2016
|
% of Net Sales
|
|
December 26, 2015
|
% of Net Sales
|
|
Increase (Decrease)
|
% Change
|
|||||||||
Net sales
|
$
|
397,453
|
|
100.0
|
%
|
|
$
|
422,483
|
|
100.0
|
%
|
|
$
|
(25,030
|
)
|
(5.9
|
)%
|
Cost of sales
|
302,028
|
|
76.0
|
%
|
|
316,253
|
|
74.9
|
%
|
|
(14,225
|
)
|
(4.5
|
)%
|
|||
Gross profit
|
95,425
|
|
24.0
|
%
|
|
106,230
|
|
25.1
|
%
|
|
(10,805
|
)
|
(10.2
|
)%
|
|||
Selling and administrative expenses
|
96,983
|
|
24.4
|
%
|
|
100,422
|
|
23.8
|
%
|
|
(3,439
|
)
|
(3.4
|
)%
|
|||
Other operating expense, net
|
401
|
|
0.1
|
%
|
|
872
|
|
0.2
|
%
|
|
(471
|
)
|
(54.0
|
)%
|
|||
Facility consolidation and severance expenses, net
|
1,456
|
|
0.4
|
%
|
|
2,946
|
|
0.7
|
%
|
|
(1,490
|
)
|
(50.6
|
)%
|
|||
Operating income (loss)
|
(3,415
|
)
|
(0.9
|
)%
|
|
1,990
|
|
0.4
|
%
|
|
(5,405
|
)
|
(271.6
|
)%
|
|||
Interest expense
|
5,392
|
|
1.4
|
%
|
|
4,935
|
|
1.2
|
%
|
|
457
|
|
9.3
|
%
|
|||
Other expense, net
|
22
|
|
—
|
%
|
|
47
|
|
—
|
%
|
|
(25
|
)
|
(53.2
|
)%
|
|||
Loss before taxes
|
(8,829
|
)
|
(2.3
|
)%
|
|
(2,992
|
)
|
(0.8
|
)%
|
|
(5,837
|
)
|
195.1
|
%
|
|||
Income tax benefit
|
(3,622
|
)
|
(0.9
|
)%
|
|
(714
|
)
|
(0.2
|
)%
|
|
(2,908
|
)
|
407.3
|
%
|
|||
Loss from continuing operations
|
(5,207
|
)
|
(1.4
|
)%
|
|
(2,278
|
)
|
(0.6
|
)%
|
|
(2,929
|
)
|
128.6
|
%
|
|||
Loss from discontinued operations
|
(131
|
)
|
—
|
%
|
|
(148
|
)
|
—
|
%
|
|
17
|
|
(11.5
|
)%
|
|||
Income on disposal of discontinued operations
|
60
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
60
|
|
—
|
%
|
|||
Net loss
|
$
|
(5,278
|
)
|
(1.4
|
)%
|
|
$
|
(2,426
|
)
|
(0.6
|
)%
|
|
$
|
(2,852
|
)
|
117.6
|
%
|
|
Fiscal Year Ended (amounts in thousands)
|
|
||||||||||||||||
|
Net Sales December 31, 2016
|
Week 53
|
Net Sales as Adjusted December 31, 2016
|
|
Net Sales December 26, 2015
|
Increase (Decrease)
|
Net Sales as Adjusted % Change
|
|||||||||||
Net sales as adjusted
|
$
|
397,453
|
|
$
|
(5,380
|
)
|
$
|
392,073
|
|
|
$
|
422,483
|
|
$
|
(30,410
|
)
|
(7.2
|
)%
|
|
|
Payments Due By Period
|
|||||||||||||||||||||||||
|
|
(dollars in millions)
|
|||||||||||||||||||||||||
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
Thereafter
|
|
Total
|
|||||||||||||
Debt
|
|
$
|
5.5
|
|
|
$
|
2.8
|
|
|
$
|
1.9
|
|
|
$
|
99.4
|
|
|
$
|
1.0
|
|
|
$
|
8.8
|
|
|
119.4
|
|
Interest - debt
(1)
|
|
5.0
|
|
|
4.8
|
|
|
4.8
|
|
|
3.6
|
|
|
0.4
|
|
|
0.7
|
|
|
19.3
|
|
||||||
Capital leases
|
|
4.3
|
|
|
3.4
|
|
|
3.2
|
|
|
2.5
|
|
|
0.9
|
|
|
0.2
|
|
|
14.5
|
|
||||||
Interest - capital leases
|
|
0.7
|
|
|
0.5
|
|
|
0.3
|
|
|
0.2
|
|
|
0.1
|
|
|
—
|
|
|
1.8
|
|
||||||
Operating leases
|
|
3.7
|
|
|
2.9
|
|
|
2.4
|
|
|
1.9
|
|
|
1.4
|
|
|
3.5
|
|
|
15.8
|
|
||||||
Purchase commitments
|
|
1.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.1
|
|
||||||
Totals
|
|
20.3
|
|
|
14.4
|
|
|
12.6
|
|
|
107.6
|
|
|
3.8
|
|
|
13.2
|
|
|
171.9
|
|
•
|
Revenue recognition.
Revenues, including shipping and handling amounts, are recognized when the following criteria are met: there is persuasive evidence that a sales agreement exists, delivery has occurred or services have been rendered, the price to the buyer is fixed or determinable, and collection is reasonably assured. Delivery is considered to have occurred when the customer takes title to products, which is generally on the date of shipment. At the time revenue is recognized, we record a provision for the estimated amount of future returns including product warranties and customer claims based primarily on historical experience and any known trends or conditions.
|
•
|
Customer claims and product warranties.
We provide product warranties related to manufacturing defects and specific performance standards for our products. We record reserves for the estimated costs of defective products and failure to meet applicable performance standards. The levels of reserves are established based primarily upon historical experience and our evaluation of pending claims. Because our evaluations are based on historical experience and conditions at the time our financial statements are prepared, actual results could differ from the reserves in our Consolidated Financial Statements.
|
•
|
Accounts receivable allowances.
We provide allowances for expected cash discounts and doubtful accounts based upon historical experience and periodic evaluations of the financial condition of our customers. If the financial conditions of our customers were to significantly deteriorate, or other factors impair their ability to pay their debts, credit losses could differ from allowances recorded in our Consolidated Financial Statements.
|
•
|
Inventories.
Inventories are stated at the lower of cost or market. Cost is determined using the last-in, first-out method (LIFO), which generally matches current costs of inventory sold with current revenues, for substantially all inventories. Reserves are also established to adjust inventories that are off-quality, aged or obsolete to their estimated net realizable value. Additionally, rates of recoverability per unit of off-quality, aged or obsolete inventory are estimated based on historical rates of recoverability and other known conditions or circumstances that may affect future recoverability. Actual results could differ from assumptions used to value our inventory.
|
•
|
Goodwill.
Goodwill is tested annually for impairment during the fourth quarter or earlier if significant events or substantive changes in circumstances occur that may indicate that goodwill may not be recoverable. The goodwill impairment tests are based on determining the fair value of the specified reporting units based on management judgments and assumptions using the discounted cash flows and comparable company market valuation approaches. We have identified our reporting unit as our floorcovering business for the purposes of allocating goodwill and assessing impairments. The valuation approaches are subject to key judgments and assumptions that are sensitive to change such as judgments and assumptions about sales growth rates, operating margins, the weighted average cost of capital (“WACC”), synergies from the viewpoint of a market participant and comparable company market multiples. When developing these key judgments and assumptions, we consider economic, operational and market conditions that could impact the fair value of the reporting unit. However, estimates are inherently uncertain and represent only management’s reasonable expectations regarding future developments. These estimates and the judgments and assumptions upon which the estimates are based will, in all likelihood, differ in some respects from actual future results. If we were unable to maintain cash flow at current levels for a prolonged period of time, we could fail to meet our goodwill tests. We are concentrated in the soft floorcovering part of the market and this area of the market has been shrinking. If we are unable to develop products that allow us to maintain or enhance our position in the upper end of the soft floorcovering portion of the market or are unable to generate growth through the offering of hard surface products we could lose the ability to generate sufficient cash flows to justify our calculations. Should a significant or prolonged deterioration in economic conditions occur, a substantial increase in our cost of capital occur or a decline in comparable company market multiples, then key judgments and assumptions could be impacted. We performed our annual assessment of goodwill in the fourth quarters of 2017, 2016 and 2015 and no impairment was indicated. In addition, at December 30, 2017, our reporting segment was not at risk of failing the goodwill impairment test. The estimated fair value exceeded the carrying amount at the date of testing in excess of 30%.
|
•
|
Self-insured accruals.
We estimate costs required to settle claims related to our self-insured medical, dental and workers' compensation plans. These estimates include costs to settle known claims, as well as incurred and unreported claims. The estimated costs of known and unreported claims are based on historical experience. Actual results could differ from assumptions used to estimate these accruals.
|
•
|
Income taxes.
Our effective tax rate is based on income, statutory tax rates and tax planning opportunities available in the jurisdictions in which we operate. Tax laws are complex and subject to different interpretations by the taxpayer and respective governmental taxing authorities. Deferred tax assets represent amounts available to reduce income taxes payable on taxable income in a future period. We evaluate the recoverability of these future tax benefits by assessing the adequacy of future expected taxable income from all sources, including reversal of taxable temporary differences, forecasted operating earnings and available tax planning strategies. These sources of income inherently rely on estimates, including business forecasts and other projections of financial results over an extended period of time. In the event that we are not able to realize all or a portion of our deferred tax assets in the future, a valuation allowance is provided. We recognize such amounts through a charge to income in the period in which that determination is made or when tax law changes are enacted. We had valuation allowances of $13.0 million at December 30, 2017 and $5.4 million at December 31, 2016. On December 22, 2017, the President signed the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act, among other things, lowered the U.S. corporate income tax rate from 35% to 21% effective January 1, 2018. Consequently, we wrote down our net deferred tax assets as of December 30, 2017 by $8.2 million to reflect the estimated impact of the Tax Act. This amount included a charge of $1.8 million related to the re-measurement of certain net deferred tax assets using the lower U.S. corporate income tax rate and a charge of $6.4 million to increase our valuation allowance related to our net deferred tax asset. The majority of the increase in the valuation allowance is related to the revised treatment of net operating losses under the Tax Act. While we have substantially completed our provisional analysis of the income tax effects of the Tax Act and recorded a reasonable estimate of such effects, the charge related to the Tax Act may differ, possibly materially, due to, among other things, further refinement of our calculations, changes in interpretations and assumptions that we have made or additional guidance that may be issued related to the Tax Act. We will complete our analysis over a one-year measurement period from the enactment date, and any adjustments during this measurement period will be included in income from continuing operations as an adjustment to income tax expense in the reporting period when such adjustments are determined. At December 30, 2017, we were in a net deferred tax liability position of $1.1 million. For further information regarding our valuation allowances, see Note 13 to the consolidated financial statements and for information regarding our assumption of future taxable income see Income Tax Considerations included in this report.
|
•
|
Loss contingencies.
We routinely assess our exposure related to legal matters, environmental matters, product liabilities or any other claims against our assets that may arise in the normal course of business. If we determine that it is probable a loss has been incurred, the amount of the loss, or an amount within the range of loss, that can be reasonably estimated will be recorded.
|
Item 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
Item 9B.
|
OTHER INFORMATION
|
Item 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
Item 11.
|
EXECUTIVE COMPENSATION
|
Item 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
|
(a)
|
|
(b)
|
|
(c)
|
||||
Plan Category
|
Number of securities to be issued upon exercise of the outstanding options, warrants and rights
|
|
Weighted-average exercise price of outstanding options, warrants and rights
|
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)
|
||||
Equity Compensation Plans approved by security holders
|
447,932
|
|
(1)
|
$
|
5.02
|
|
(2)
|
486,600
|
|
(1)
|
Includes the options to purchase 103,500 shares and 203,000 shares of Common Stock under our 2006 Stock Awards Plan and 2016 Stock Awards Plan, respectively, and 141,432 Performance Units issued under the 2016 Stock Awards Plan, each unit being equivalent to one share of Common Stock. Does not include shares of Common Stock issued but not vested pursuant to outstanding restricted stock awards.
|
(2)
|
Includes the aggregate weighted-average of (i) the exercise price per share for outstanding options to purchase 103,500 shares and 203,000 shares of Common Stock under our 2006 Stock Awards Plan and 2016 Stock Awards Plan, respectively, and (ii) the price per share of the Common Stock on the grant date for each of 141,432 Performance Units issued under the 2016 Stock Awards Plan (each unit equivalent to one share of Common Stock).
|
Item 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
Item 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
Item 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
(a)
|
(1) Financial Statements - The response to this portion of Item 15 is submitted as a separate section of this report.
|
(b)
|
Exhibits - The response to this portion of Item 15 is submitted as a separate section of this report. See Item 15(a)(3) above.
|
(c)
|
Financial Statement Schedules - The response to this portion of Item 15 is submitted as a separate section of this report. See Item 15(a)(2).
|
Date: March 13, 2018
|
|
The Dixie Group, Inc.
|
|
|
|
|
|
/s/ DANIEL K. FRIERSON
|
|
|
By: Daniel K. Frierson
|
|
|
Chairman of the Board and Chief Executive Officer
|
Signature
|
|
Capacity
|
|
Date
|
|
|
|
|
|
/s/ DANIEL K. FRIERSON
|
|
Chairman of the Board, Director and Chief Executive Officer
|
|
March 13, 2018
|
Daniel K. Frierson
|
|
|
|
|
|
|
|
|
|
/s/ JON A. FAULKNER
|
|
Vice President, Chief Financial Officer
|
|
March 13, 2018
|
Jon A. Faulkner
|
|
|
|
|
|
|
|
|
|
/s/ D. KENNEDY FRIERSON, JR.
|
|
Vice President, Chief Operating Officer and Director
|
|
March 13, 2018
|
D. Kennedy Frierson, Jr.
|
|
|
|
|
|
|
|
|
|
/s/ WILLIAM F. BLUE, JR.
|
|
Director
|
|
March 13, 2018
|
William F. Blue, Jr.
|
|
|
|
|
|
|
|
|
|
/s/ CHARLES E. BROCK
|
|
Director
|
|
March 13, 2018
|
Charles E. Brock
|
|
|
|
|
|
|
|
|
|
/s/ WALTER W. HUBBARD
|
|
Director
|
|
March 13, 2018
|
Walter W. Hubbard
|
|
|
|
|
|
|
|
|
|
/s/ LOWRY F. KLINE
|
|
Director
|
|
March 13, 2018
|
Lowry F. Kline
|
|
|
|
|
|
|
|
|
|
/s/ HILDA S. MURRAY
|
|
Director
|
|
March 13, 2018
|
Hilda S. Murray
|
|
|
|
|
|
|
|
|
|
/s/ JOHN W. MURREY, III
|
|
Director
|
|
March 13, 2018
|
John W. Murrey, III
|
|
|
|
|
|
|
|
|
|
/s/ MICHAEL L. OWENS
|
|
Director
|
|
March 13, 2018
|
Michael L. Owens
|
|
|
|
|
Table of Contents
|
Page
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
|
||||||||||
|
December 30,
2017 |
|
December 31,
2016 |
|
December 26,
2015 |
||||||
NET SALES
|
$
|
412,462
|
|
|
$
|
397,453
|
|
|
$
|
422,483
|
|
Cost of sales
|
311,249
|
|
|
302,028
|
|
|
316,253
|
|
|||
GROSS PROFIT
|
101,213
|
|
|
95,425
|
|
|
106,230
|
|
|||
|
|
|
|
|
|
||||||
Selling and administrative expenses
|
96,171
|
|
|
96,983
|
|
|
100,422
|
|
|||
Other operating expense, net
|
441
|
|
|
401
|
|
|
872
|
|
|||
Facility consolidation and severance expenses, net
|
636
|
|
|
1,456
|
|
|
2,946
|
|
|||
OPERATING INCOME (LOSS)
|
3,965
|
|
|
(3,415
|
)
|
|
1,990
|
|
|||
|
|
|
|
|
|
||||||
Interest expense
|
5,739
|
|
|
5,392
|
|
|
4,935
|
|
|||
Other expense, net
|
39
|
|
|
22
|
|
|
47
|
|
|||
LOSS FROM CONTINUING OPERATIONS BEFORE TAXES
|
(1,813
|
)
|
|
(8,829
|
)
|
|
(2,992
|
)
|
|||
Income tax provision (benefit)
|
7,509
|
|
|
(3,622
|
)
|
|
(714
|
)
|
|||
LOSS FROM CONTINUING OPERATIONS
|
(9,322
|
)
|
|
(5,207
|
)
|
|
(2,278
|
)
|
|||
Loss from discontinued operations, net of tax
|
(233
|
)
|
|
(131
|
)
|
|
(148
|
)
|
|||
Income on disposal of discontinued operations, net of tax
|
—
|
|
|
60
|
|
|
—
|
|
|||
NET LOSS
|
$
|
(9,555
|
)
|
|
$
|
(5,278
|
)
|
|
$
|
(2,426
|
)
|
|
|
|
|
|
|
||||||
BASIC EARNINGS (LOSS) PER SHARE:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
(0.59
|
)
|
|
$
|
(0.33
|
)
|
|
$
|
(0.15
|
)
|
Discontinued operations
|
(0.01
|
)
|
|
(0.01
|
)
|
|
(0.01
|
)
|
|||
Disposal of discontinued operations
|
—
|
|
|
0.00
|
|
|
—
|
|
|||
Net loss
|
$
|
(0.60
|
)
|
|
$
|
(0.34
|
)
|
|
$
|
(0.16
|
)
|
|
|
|
|
|
|
||||||
BASIC SHARES OUTSTANDING
|
15,699
|
|
|
15,638
|
|
|
15,536
|
|
|||
|
|
|
|
|
|
||||||
DILUTED EARNINGS (LOSS) PER SHARE:
|
|
|
|
|
|
||||||
Continuing operations
|
$
|
(0.59
|
)
|
|
$
|
(0.33
|
)
|
|
$
|
(0.15
|
)
|
Discontinued operations
|
(0.01
|
)
|
|
(0.01
|
)
|
|
(0.01
|
)
|
|||
Disposal of discontinued operations
|
—
|
|
|
0.00
|
|
|
—
|
|
|||
Net loss
|
$
|
(0.60
|
)
|
|
$
|
(0.34
|
)
|
|
$
|
(0.16
|
)
|
|
|
|
|
|
|
||||||
DILUTED SHARES OUTSTANDING
|
15,699
|
|
|
15,638
|
|
|
15,536
|
|
|||
|
|
|
|
|
|
||||||
DIVIDENDS PER SHARE:
|
|
|
|
|
|
||||||
Common Stock
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Class B Common Stock
|
—
|
|
|
—
|
|
|
—
|
|
|
Year Ended
|
||||||||||
|
December 30,
2017 |
|
December 31,
2016 |
|
December 26,
2015 |
||||||
NET LOSS
|
$
|
(9,555
|
)
|
|
$
|
(5,278
|
)
|
|
$
|
(2,426
|
)
|
|
|
|
|
|
|
||||||
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:
|
|
|
|
|
|
||||||
Unrealized gain (loss) on interest rate swaps
|
180
|
|
|
(263
|
)
|
|
(2,410
|
)
|
|||
Income taxes
|
68
|
|
|
(100
|
)
|
|
(916
|
)
|
|||
Unrealized gain (loss) on interest rate swaps, net
|
112
|
|
|
(163
|
)
|
|
(1,494
|
)
|
|||
|
|
|
|
|
|
||||||
Reclassification of loss into earnings from interest rate swaps (1)
|
1,250
|
|
|
1,291
|
|
|
777
|
|
|||
Income taxes
|
475
|
|
|
491
|
|
|
295
|
|
|||
Reclassification of loss into earnings from interest rate swaps, net
|
775
|
|
|
800
|
|
|
482
|
|
|||
|
|
|
|
|
|
||||||
Unrecognized net actuarial gain (loss) on postretirement benefit plans
|
11
|
|
|
(3
|
)
|
|
48
|
|
|||
Income taxes
|
4
|
|
|
(1
|
)
|
|
18
|
|
|||
Unrecognized net actuarial gain (loss) on postretirement benefit plans, net
|
7
|
|
|
(2
|
)
|
|
30
|
|
|||
|
|
|
|
|
|
||||||
Reclassification of net actuarial gain into earnings from postretirement benefit plans (2)
|
(30
|
)
|
|
(33
|
)
|
|
(40
|
)
|
|||
Income taxes
|
(11
|
)
|
|
(13
|
)
|
|
(15
|
)
|
|||
Reclassification of net actuarial gain into earnings from postretirement benefit plans, net
|
(19
|
)
|
|
(20
|
)
|
|
(25
|
)
|
|||
|
|
|
|
|
|
||||||
Reclassification of prior service credits into earnings from postretirement benefit plans (2)
|
(4
|
)
|
|
(4
|
)
|
|
(86
|
)
|
|||
Income taxes
|
(1
|
)
|
|
(2
|
)
|
|
(33
|
)
|
|||
Reclassification of prior service credits into earnings from postretirement benefit plans, net
|
(3
|
)
|
|
(2
|
)
|
|
(53
|
)
|
|||
|
|
|
|
|
|
||||||
TOTAL OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX
|
872
|
|
|
613
|
|
|
(1,060
|
)
|
|||
|
|
|
|
|
|
||||||
COMPREHENSIVE LOSS
|
$
|
(8,683
|
)
|
|
$
|
(4,665
|
)
|
|
$
|
(3,486
|
)
|
(1)
|
Amounts for cash flow hedges reclassified from accumulated other comprehensive income (loss) to net loss were included in interest expense in the Company's Consolidated Statement of Operations.
|
(2)
|
Amounts for postretirement plans reclassified from accumulated other comprehensive income (loss) to net loss were included in selling and administrative expenses in the Company's Consolidated Statement of Operations.
|
|
Year Ended
|
||||||||||
|
December 30,
2017 |
|
December 31,
2016 |
|
December 26,
2015 |
||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|||
Loss from continuing operations
|
$
|
(9,322
|
)
|
|
$
|
(5,207
|
)
|
|
$
|
(2,278
|
)
|
Loss from discontinued operations
|
(233
|
)
|
|
(131
|
)
|
|
(148
|
)
|
|||
Income on disposal of discontinued operations
|
—
|
|
|
60
|
|
|
—
|
|
|||
Net loss
|
(9,555
|
)
|
|
(5,278
|
)
|
|
(2,426
|
)
|
|||
|
|
|
|
|
|
||||||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
12,947
|
|
|
13,515
|
|
|
14,119
|
|
|||
Provision (benefit) for deferred income taxes
|
8,181
|
|
|
(3,260
|
)
|
|
(730
|
)
|
|||
Net loss (gain) on property, plant and equipment disposals
|
170
|
|
|
725
|
|
|
(114
|
)
|
|||
Stock-based compensation expense
|
940
|
|
|
1,324
|
|
|
1,406
|
|
|||
Excess tax benefits from stock-based compensation
|
—
|
|
|
(3
|
)
|
|
(318
|
)
|
|||
Bad debt expense
|
70
|
|
|
38
|
|
|
146
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Receivables
|
(2,945
|
)
|
|
7,163
|
|
|
(335
|
)
|
|||
Inventories
|
(16,420
|
)
|
|
17,909
|
|
|
(10,939
|
)
|
|||
Other current assets
|
776
|
|
|
(1,014
|
)
|
|
751
|
|
|||
Accounts payable and accrued expenses
|
(3,161
|
)
|
|
(6,827
|
)
|
|
7,606
|
|
|||
Other operating assets and liabilities
|
(609
|
)
|
|
(371
|
)
|
|
(557
|
)
|
|||
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES
|
(9,606
|
)
|
|
23,921
|
|
|
8,609
|
|
|||
|
|
|
|
|
|
||||||
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
||||||
Net proceeds from sales of property, plant and equipment
|
—
|
|
|
1
|
|
|
68
|
|
|||
Purchase of property, plant and equipment
|
(12,724
|
)
|
|
(4,904
|
)
|
|
(6,826
|
)
|
|||
NET CASH USED IN INVESTING ACTIVITIES
|
(12,724
|
)
|
|
(4,903
|
)
|
|
(6,758
|
)
|
|||
|
|
|
|
|
|
||||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
||||||
Net borrowings (payments) on revolving credit facility
|
27,125
|
|
|
(9,986
|
)
|
|
(2,328
|
)
|
|||
Borrowings on notes payable - buildings
|
—
|
|
|
—
|
|
|
6,290
|
|
|||
Payments on notes payable - buildings
|
(731
|
)
|
|
(731
|
)
|
|
(705
|
)
|
|||
Payments on notes payable related to acquisitions
|
(1,920
|
)
|
|
(1,924
|
)
|
|
(1,840
|
)
|
|||
Borrowings on notes payable - equipment and other
|
7,612
|
|
|
2,674
|
|
|
1,923
|
|
|||
Payments on notes payable - equipment and other
|
(4,145
|
)
|
|
(4,653
|
)
|
|
(4,387
|
)
|
|||
Payments on capital leases
|
(3,921
|
)
|
|
(3,171
|
)
|
|
(2,742
|
)
|
|||
Change in outstanding checks in excess of cash
|
(1,695
|
)
|
|
(932
|
)
|
|
1,816
|
|
|||
Proceeds from exercise of stock options
|
—
|
|
|
—
|
|
|
275
|
|
|||
Repurchases of Common Stock
|
(116
|
)
|
|
(152
|
)
|
|
(584
|
)
|
|||
Excess tax benefits from stock-based compensation
|
—
|
|
|
3
|
|
|
318
|
|
|||
Payments for debt issuance costs
|
—
|
|
|
(287
|
)
|
|
—
|
|
|||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
|
22,209
|
|
|
(19,159
|
)
|
|
(1,964
|
)
|
|||
|
|
|
|
|
|
||||||
DECREASE IN CASH AND CASH EQUIVALENTS
|
(121
|
)
|
|
(141
|
)
|
|
(113
|
)
|
|||
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
140
|
|
|
281
|
|
|
394
|
|
|||
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
$
|
19
|
|
|
$
|
140
|
|
|
$
|
281
|
|
|
|
|
|
|
|
||||||
SUPPLEMENTAL CASH FLOW INFORMATION:
|
|
|
|
|
|
||||||
Equipment purchased under capital leases
|
621
|
|
|
169
|
|
|
496
|
|
|||
Equipment purchased under notes payable
|
59
|
|
|
—
|
|
|
2,850
|
|
|||
Deposits utilized on purchased equipment, net
|
—
|
|
|
—
|
|
|
1,857
|
|
|||
Accrued purchases of equipment
|
179
|
|
|
258
|
|
|
200
|
|
|||
Shortfall of tax benefits from stock-based compensation
|
—
|
|
|
(192
|
)
|
|
(102
|
)
|
|||
Note receivable on sale of equipment
|
—
|
|
|
—
|
|
|
93
|
|
|
Common Stock
|
|
Class B Common Stock
|
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total Stockholders' Equity
|
||||||||||||
Balance at December 27, 2014
|
$
|
45,022
|
|
|
$
|
2,293
|
|
|
$
|
155,127
|
|
|
$
|
(107,952
|
)
|
|
$
|
(1,513
|
)
|
|
$
|
92,977
|
|
Common Stock issued - 53,372 shares
|
161
|
|
|
—
|
|
|
114
|
|
|
—
|
|
|
—
|
|
|
275
|
|
||||||
Common Stock issued under Directors' Stock Plan - 30,738
|
92
|
|
|
—
|
|
|
(92
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Repurchases of Common Stock - 64,304 shares
|
(193
|
)
|
|
—
|
|
|
(391
|
)
|
|
—
|
|
|
—
|
|
|
(584
|
)
|
||||||
Restricted stock grants issued - 224,625 shares
|
326
|
|
|
347
|
|
|
(673
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Restricted stock grants forfeited - 9,078 shares
|
(27
|
)
|
|
—
|
|
|
27
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Class B converted into Common Stock - 28,459 shares
|
85
|
|
|
(85
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
1,406
|
|
|
—
|
|
|
—
|
|
|
1,406
|
|
||||||
Excess tax benefits from stock-based compensation
|
—
|
|
|
—
|
|
|
216
|
|
|
—
|
|
|
—
|
|
|
216
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,426
|
)
|
|
—
|
|
|
(2,426
|
)
|
||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,060
|
)
|
|
(1,060
|
)
|
||||||
Balance at December 26, 2015
|
45,466
|
|
|
2,555
|
|
|
155,734
|
|
|
(110,378
|
)
|
|
(2,573
|
)
|
|
90,804
|
|
||||||
Repurchases of Common Stock - 35,815 shares
|
(107
|
)
|
|
—
|
|
|
(45
|
)
|
|
—
|
|
|
—
|
|
|
(152
|
)
|
||||||
Restricted stock grants issued - 149,215 shares
|
354
|
|
|
93
|
|
|
(447
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Restricted stock grants forfeited - 1,314 shares
|
(4
|
)
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Class B converted into Common Stock - 12,144 shares
|
36
|
|
|
(36
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
1,324
|
|
|
—
|
|
|
—
|
|
|
1,324
|
|
||||||
Excess tax benefits from stock-based compensation
|
—
|
|
|
—
|
|
|
(189
|
)
|
|
—
|
|
|
—
|
|
|
(189
|
)
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,278
|
)
|
|
—
|
|
|
(5,278
|
)
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
613
|
|
|
613
|
|
||||||
Balance at December 31, 2016
|
45,745
|
|
|
2,612
|
|
|
156,381
|
|
|
(115,656
|
)
|
|
(1,960
|
)
|
|
87,122
|
|
||||||
Repurchases of Common Stock - 33,112 shares
|
(100
|
)
|
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
—
|
|
|
(116
|
)
|
||||||
Restricted stock grants issued - 60,000 shares
|
180
|
|
|
—
|
|
|
(180
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Restricted stock grants forfeited - 4,629 shares
|
(14
|
)
|
|
—
|
|
|
12
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
||||||
Class B converted into Common Stock - 9,215 shares
|
28
|
|
|
(28
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
942
|
|
|
—
|
|
|
—
|
|
|
942
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(9,555
|
)
|
|
—
|
|
|
(9,555
|
)
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
872
|
|
|
872
|
|
||||||
Reclassification of stranded tax effects
|
—
|
|
|
—
|
|
|
—
|
|
|
211
|
|
|
(211
|
)
|
|
—
|
|
||||||
Balance at December 30, 2017
|
$
|
45,839
|
|
|
$
|
2,584
|
|
|
$
|
157,139
|
|
|
$
|
(125,000
|
)
|
|
$
|
(1,299
|
)
|
|
$
|
79,263
|
|
|
2017
|
|
2016
|
||||
Customers, trade
|
$
|
43,683
|
|
|
$
|
39,749
|
|
Other receivables
|
2,930
|
|
|
3,963
|
|
||
Gross receivables
|
46,613
|
|
|
43,712
|
|
||
Less: allowance for doubtful accounts
|
(133
|
)
|
|
(107
|
)
|
||
Receivables, net
|
$
|
46,480
|
|
|
$
|
43,605
|
|
|
2017
|
|
2016
|
||||
Raw materials
|
$
|
39,264
|
|
|
$
|
34,261
|
|
Work-in-process
|
24,454
|
|
|
16,739
|
|
||
Finished goods
|
65,172
|
|
|
57,053
|
|
||
Supplies and other
|
143
|
|
|
120
|
|
||
LIFO reserve
|
(15,376
|
)
|
|
(10,936
|
)
|
||
Inventories, net
|
$
|
113,657
|
|
|
$
|
97,237
|
|
|
2017
|
|
2016
|
||||
Land and improvements
|
$
|
7,886
|
|
|
$
|
7,781
|
|
Buildings and improvements
|
62,852
|
|
|
62,055
|
|
||
Machinery and equipment
|
188,971
|
|
|
177,745
|
|
||
Assets under construction
|
2,443
|
|
|
2,386
|
|
||
|
262,152
|
|
|
249,967
|
|
||
Accumulated depreciation
|
(168,367
|
)
|
|
(157,160
|
)
|
||
Property, plant and equipment, net
|
$
|
93,785
|
|
|
$
|
92,807
|
|
|
2017
|
|
2016
|
||||||||||||||||||||
|
Gross
|
|
Accumulated Amortization
|
|
Net
|
|
Gross
|
|
Accumulated Amortization
|
|
Net
|
||||||||||||
Customer relationships
|
$
|
208
|
|
|
$
|
(80
|
)
|
|
$
|
128
|
|
|
$
|
208
|
|
|
$
|
(64
|
)
|
|
$
|
144
|
|
Rug design coding
|
144
|
|
|
(72
|
)
|
|
72
|
|
|
144
|
|
|
(57
|
)
|
|
87
|
|
||||||
Trade names
|
3,300
|
|
|
(1,039
|
)
|
|
2,261
|
|
|
3,300
|
|
|
(764
|
)
|
|
2,536
|
|
||||||
Total
|
$
|
3,652
|
|
|
$
|
(1,191
|
)
|
|
$
|
2,461
|
|
|
$
|
3,652
|
|
|
$
|
(885
|
)
|
|
$
|
2,767
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
Customer relationships
|
$
|
16
|
|
|
$
|
16
|
|
|
$
|
16
|
|
Rug design coding
|
15
|
|
|
14
|
|
|
14
|
|
|||
Trade names
|
275
|
|
|
275
|
|
|
275
|
|
|||
Amortization expense
|
$
|
306
|
|
|
$
|
305
|
|
|
$
|
305
|
|
Year
|
|
Amount
|
||
2018
|
|
$
|
305
|
|
2019
|
|
305
|
|
|
2020
|
|
305
|
|
|
2021
|
|
305
|
|
|
2022
|
|
305
|
|
|
2017
|
|
2016
|
||||
Compensation and benefits (1)
|
$
|
9,276
|
|
|
$
|
7,492
|
|
Provision for customer rebates, claims and allowances
|
8,751
|
|
|
8,882
|
|
||
Advanced customer deposits
|
5,717
|
|
|
8,212
|
|
||
Outstanding checks in excess of cash
|
379
|
|
|
2,074
|
|
||
Other
|
6,168
|
|
|
6,166
|
|
||
Accrued expenses
|
$
|
30,291
|
|
|
$
|
32,826
|
|
(1)
|
Includes a liability related to the Company's self-insured Workers' Compensation program. This program is collateralized by letters of credit in the aggregate amount of
$2,171
.
|
|
2017
|
|
2016
|
||||
Product warranty reserve at beginning of period
|
$
|
2,307
|
|
|
$
|
2,159
|
|
Warranty liabilities accrued
|
6,049
|
|
|
6,406
|
|
||
Warranty liabilities settled
|
(6,160
|
)
|
|
(6,687
|
)
|
||
Changes for pre-existing warranty liabilities
|
(321
|
)
|
|
429
|
|
||
Product warranty reserve at end of period
|
$
|
1,875
|
|
|
$
|
2,307
|
|
|
2017
|
|
2016
|
||||
Revolving credit facility
|
$
|
97,708
|
|
|
$
|
70,583
|
|
Notes payable - buildings
|
12,419
|
|
|
13,150
|
|
||
Acquisition note payable - Development Authority of Gordon County
|
—
|
|
|
1,147
|
|
||
Acquisition note payable - Robertex
|
791
|
|
|
1,564
|
|
||
Notes payable - equipment and other
|
8,474
|
|
|
11,633
|
|
||
Capital lease obligations
|
14,530
|
|
|
11,145
|
|
||
Deferred financing costs, net
|
(665
|
)
|
|
(844
|
)
|
||
Total long-term debt
|
133,257
|
|
|
108,378
|
|
||
Less: current portion of long-term debt
|
9,811
|
|
|
10,122
|
|
||
Long-term debt
|
$
|
123,446
|
|
|
$
|
98,256
|
|
|
Long-Term
Debt
|
|
Capital Leases (See Note 17)
|
|
Total
|
||||||
|
|||||||||||
2018
|
$
|
5,527
|
|
|
$
|
4,284
|
|
|
$
|
9,811
|
|
2019
|
2,782
|
|
|
3,382
|
|
|
6,164
|
|
|||
2020
|
1,873
|
|
|
3,180
|
|
|
5,053
|
|
|||
2021
|
99,446
|
|
|
2,534
|
|
|
101,980
|
|
|||
2022
|
1,001
|
|
|
913
|
|
|
1,914
|
|
|||
Thereafter
|
8,763
|
|
|
237
|
|
|
9,000
|
|
|||
Total maturities of long-term debt
|
$
|
119,392
|
|
|
$
|
14,530
|
|
|
$
|
133,922
|
|
Deferred financing costs, net
|
(665
|
)
|
|
—
|
|
|
(665
|
)
|
|||
Total long-term debt
|
$
|
118,727
|
|
|
$
|
14,530
|
|
|
$
|
133,257
|
|
|
2017
|
|
2016
|
|
Fair Value Hierarchy Level
|
||||
Liabilities:
|
|
|
|
|
|
||||
Interest rate swaps (1)
|
$
|
2,229
|
|
|
$
|
3,695
|
|
|
Level 2
|
Contingent consideration (2)
|
25
|
|
|
200
|
|
|
Level 3
|
(1)
|
The Company uses certain external sources in deriving the fair value of the interest rate swaps. The interest rate swaps were valued using observable inputs (e.g., LIBOR yield curves, credit spreads). Valuations of interest rate swaps may fluctuate considerably from period-to-period due to volatility in underlying interest rates, which are driven by market conditions and the duration of the instrument. Credit adjustments could have a significant impact on the valuations due to changes in credit ratings of the Company or its counterparties.
|
(2)
|
As a result of the Robertex acquisition in 2013, the Company recorded a contingent consideration liability at fair value. This fair value measurement was based on calculations that utilize significant inputs not observable in the market including forecasted revenues, gross margins and discount rates and thus represent Level 3 measurements. This fair value measurement is directly impacted by the Company's estimates. Accordingly, if the estimates within the fair value measurement are higher or lower, the Company would record additional charges or benefits, respectively, as appropriate.
|
|
2017
|
|
2016
|
||||
Beginning balance
|
$
|
200
|
|
|
$
|
584
|
|
Fair value adjustments
|
(163
|
)
|
|
(230
|
)
|
||
Settlements
|
(12
|
)
|
|
(154
|
)
|
||
Ending balance
|
$
|
25
|
|
|
$
|
200
|
|
|
2017
|
|
2016
|
||||||||||||
|
Carrying
|
|
Fair
|
|
Carrying
|
|
Fair
|
||||||||
|
Amount
|
|
Value
|
|
Amount
|
|
Value
|
||||||||
Financial assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
19
|
|
|
$
|
19
|
|
|
$
|
140
|
|
|
$
|
140
|
|
Notes receivable, including current portion
|
282
|
|
|
282
|
|
|
282
|
|
|
282
|
|
||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|||||||
Long-term debt and capital leases, including current portion
|
133,257
|
|
|
131,203
|
|
|
108,378
|
|
|
105,270
|
|
||||
Interest rate swaps
|
2,229
|
|
|
2,229
|
|
|
3,695
|
|
|
3,695
|
|
Type
|
Notional Amount
|
|
Effective Date
|
Fixed Rate
|
Variable Rate
|
||
Interest rate swap
|
$
|
25,000
|
|
|
September 1, 2016 through September 1, 2021
|
3.105%
|
1 Month LIBOR
|
Interest rate swap
|
$
|
25,000
|
|
|
September 1, 2015 through September 1, 2021
|
3.304%
|
1 Month LIBOR
|
Interest rate swap
|
$
|
7,046
|
|
(1)
|
November 7, 2014 through November 7, 2024
|
4.500%
|
1 Month LIBOR
|
Interest rate swap
|
$
|
5,373
|
|
(2)
|
January 7, 2017 through January 7, 2025
|
4.300%
|
1 Month LIBOR
|
|
Location on Consolidated Balance Sheets
|
Fair Value
|
||||||
|
2017
|
|
2016
|
|||||
Liability Derivatives:
|
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
||||
Interest rate swaps, current portion
|
Accrued Expenses
|
$
|
842
|
|
|
$
|
1,342
|
|
Interest rate swaps, long-term portion
|
Other Long-Term Liabilities
|
1,387
|
|
|
2,353
|
|
||
Total Liability Derivatives
|
|
$
|
2,229
|
|
|
$
|
3,695
|
|
|
Amount of Gain or (Loss) Recognized in AOCIL on the effective portion of the Derivative
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
||||||
Cash flow hedges - interest rate swaps
|
$
|
180
|
|
|
$
|
(263
|
)
|
|
$
|
(2,410
|
)
|
|
|
|
|
|
|
||||||
|
Amount of Gain or (Loss) Reclassified from AOCIL on the effective portion into Income (1)(2)
|
||||||||||
|
2017
|
|
2016
|
|
2015
|
||||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
||||||
Cash flow hedges - interest rate swaps
|
$
|
(1,250
|
)
|
|
$
|
(1,291
|
)
|
|
$
|
(777
|
)
|
(1)
|
The amount of gain (loss) reclassified from AOCIL is included in interest expense on the Company's Consolidated Statements of Operations.
|
(2)
|
The amount of loss expected to be reclassified from AOCIL into earnings during the next 12 months subsequent to fiscal 2017 is
$842
.
|
Pension Fund
|
EIN/Pension Plan Number
|
Pension Protection Act Zone Status
|
FIP/RP Status Pending/Implemented (1)
|
Contributions (2)
|
Surcharge Imposed (1)
|
Expiration Date of Collective-Bargaining Agreement
|
|||||||||
2017
|
2016
|
2017
|
|
2016
|
|
2015
|
|
||||||||
The Pension Plan of the National Retirement Fund
|
13-6130178 - 001
|
Red
|
Red
|
Implemented
|
$
|
313
|
|
$
|
274
|
|
$
|
268
|
|
Yes
|
6/3/2018
|
|
2017
|
|
2016
|
||||
Change in benefit obligation:
|
|
|
|
||||
Benefit obligation at beginning of year
|
$
|
314
|
|
|
$
|
290
|
|
Service cost
|
7
|
|
|
7
|
|
||
Interest cost
|
16
|
|
|
15
|
|
||
Actuarial (gain) loss
|
(11
|
)
|
|
3
|
|
||
Benefits paid
|
(1
|
)
|
|
(1
|
)
|
||
Benefit obligation at end of year
|
325
|
|
|
314
|
|
||
|
|
|
|
||||
Change in plan assets:
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
—
|
|
|
—
|
|
||
Employer contributions
|
1
|
|
|
1
|
|
||
Benefits paid
|
(1
|
)
|
|
(1
|
)
|
||
Fair value of plan assets at end of year
|
—
|
|
|
—
|
|
||
|
|
|
|
||||
Unfunded amount
|
$
|
(325
|
)
|
|
$
|
(314
|
)
|
|
2017
|
|
2016
|
||||
Accrued expenses
|
$
|
14
|
|
|
$
|
13
|
|
Other long-term liabilities
|
311
|
|
|
301
|
|
||
Total liability
|
$
|
325
|
|
|
$
|
314
|
|
|
2017
|
|
2016
|
||
Weighted-average assumptions as of year-end:
|
|
|
|
||
Discount rate (benefit obligation)
|
4.00
|
%
|
|
4.00
|
%
|
|
2017
|
|
2016
|
|
2015
|
||||||
Service cost
|
$
|
7
|
|
|
$
|
7
|
|
|
$
|
7
|
|
Interest cost
|
16
|
|
|
15
|
|
|
18
|
|
|||
Amortization of prior service credits
|
(4
|
)
|
|
(4
|
)
|
|
(86
|
)
|
|||
Recognized net actuarial gains
|
(30
|
)
|
|
(33
|
)
|
|
(40
|
)
|
|||
Net periodic benefit cost (credit)
|
$
|
(11
|
)
|
|
$
|
(15
|
)
|
|
$
|
(101
|
)
|
|
Postretirement Benefit Plan
|
||||||
|
Balance at 2017
|
|
2018 Expected Amortization
|
||||
Prior service credits
|
$
|
(8
|
)
|
|
$
|
(4
|
)
|
Unrecognized actuarial gains
|
(381
|
)
|
|
(30
|
)
|
||
Totals
|
$
|
(389
|
)
|
|
$
|
(34
|
)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Current
|
|
|
|
|
|
||||||
Federal
|
$
|
278
|
|
|
$
|
(396
|
)
|
|
$
|
277
|
|
State
|
(950
|
)
|
|
34
|
|
|
(261
|
)
|
|||
Total current
|
(672
|
)
|
|
(362
|
)
|
|
16
|
|
|||
|
|
|
|
|
|
||||||
Deferred
|
|
|
|
|
|
||||||
Federal
|
7,535
|
|
|
(3,003
|
)
|
|
(641
|
)
|
|||
State
|
646
|
|
|
(257
|
)
|
|
(89
|
)
|
|||
Total deferred
|
8,181
|
|
|
(3,260
|
)
|
|
(730
|
)
|
|||
Income tax provision (benefit)
|
$
|
7,509
|
|
|
$
|
(3,622
|
)
|
|
$
|
(714
|
)
|
|
2017
|
|
2016
|
|
2015
|
||||||
Federal statutory rate
|
35
|
%
|
|
35
|
%
|
|
35
|
%
|
|||
Statutory rate applied to income (loss) from continuing operations before taxes
|
$
|
(635
|
)
|
|
$
|
(3,090
|
)
|
|
$
|
(1,047
|
)
|
Plus state income taxes, net of federal tax effect
|
(198
|
)
|
|
(145
|
)
|
|
(227
|
)
|
|||
Total statutory provision (benefit)
|
(833
|
)
|
|
(3,235
|
)
|
|
(1,274
|
)
|
|||
Effect of differences:
|
|
|
|
|
|
||||||
Nondeductible meals and entertainment
|
161
|
|
|
148
|
|
|
147
|
|
|||
Federal tax credits
|
(200
|
)
|
|
(395
|
)
|
|
(441
|
)
|
|||
Reserve for uncertain tax positions
|
8
|
|
|
31
|
|
|
35
|
|
|||
Goodwill
|
—
|
|
|
(13
|
)
|
|
(124
|
)
|
|||
Change in valuation allowance
|
6,470
|
|
|
106
|
|
|
977
|
|
|||
Tax reform
|
1,749
|
|
|
—
|
|
|
—
|
|
|||
Stock-based compensation
|
146
|
|
|
—
|
|
|
—
|
|
|||
Other items
|
8
|
|
|
(264
|
)
|
|
(34
|
)
|
|||
Income tax provision (benefit)
|
$
|
7,509
|
|
|
$
|
(3,622
|
)
|
|
$
|
(714
|
)
|
|
2017
|
|
2016
|
||||
Deferred tax assets:
|
|
|
|
||||
Inventories
|
$
|
3,146
|
|
|
$
|
4,057
|
|
Retirement benefits
|
2,200
|
|
|
3,387
|
|
||
State net operating losses
|
4,196
|
|
|
3,672
|
|
||
Federal net operating losses
|
3,204
|
|
|
5,930
|
|
||
State tax credit carryforwards
|
1,963
|
|
|
1,728
|
|
||
Federal tax credit carryforwards
|
3,365
|
|
|
3,361
|
|
||
Allowances for bad debts, claims and discounts
|
2,373
|
|
|
3,442
|
|
||
Other
|
3,649
|
|
|
5,001
|
|
||
Total deferred tax assets
|
24,096
|
|
|
30,578
|
|
||
Valuation allowance
|
(12,994
|
)
|
|
(5,400
|
)
|
||
Net deferred tax assets
|
11,102
|
|
|
25,178
|
|
||
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Property, plant and equipment
|
12,207
|
|
|
17,568
|
|
||
Total deferred tax liabilities
|
12,207
|
|
|
17,568
|
|
||
|
|
|
|
||||
Net deferred tax asset (liability)
|
$
|
(1,105
|
)
|
|
$
|
7,610
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
Balance at beginning of year
|
$
|
406
|
|
|
$
|
375
|
|
|
$
|
400
|
|
Additions based on tax positions taken during a current period
|
8
|
|
|
31
|
|
|
35
|
|
|||
Reductions related to settlement of tax matters
|
—
|
|
|
—
|
|
|
(60
|
)
|
|||
Balance at end of year
|
$
|
414
|
|
|
$
|
406
|
|
|
$
|
375
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
Basic earnings (loss) per share:
|
|
|
|
|
|
||||||
Income (loss) from continuing operations
|
$
|
(9,322
|
)
|
|
$
|
(5,207
|
)
|
|
$
|
(2,278
|
)
|
Less: Allocation of earnings to participating securities
|
—
|
|
|
—
|
|
|
—
|
|
|||
Income (loss) from continuing operations available to common shareholders - basic
|
$
|
(9,322
|
)
|
|
$
|
(5,207
|
)
|
|
$
|
(2,278
|
)
|
Basic weighted-average shares outstanding (1)
|
15,699
|
|
|
15,638
|
|
|
15,536
|
|
|||
Basic earnings (loss) per share - continuing operations
|
$
|
(0.59
|
)
|
|
$
|
(0.33
|
)
|
|
$
|
(0.15
|
)
|
|
|
|
|
|
|
||||||
Diluted earnings (loss) per share:
|
|
|
|
|
|
||||||
Income (loss) from continuing operations available to common shareholders - basic
|
$
|
(9,322
|
)
|
|
$
|
(5,207
|
)
|
|
$
|
(2,278
|
)
|
Add: Undistributed earnings reallocated to unvested shareholders
|
—
|
|
|
—
|
|
|
—
|
|
|||
Income (loss) from continuing operations available to common shareholders - basic
|
$
|
(9,322
|
)
|
|
$
|
(5,207
|
)
|
|
$
|
(2,278
|
)
|
Basic weighted-average shares outstanding (1)
|
15,699
|
|
|
15,638
|
|
|
15,536
|
|
|||
Effect of dilutive securities:
|
|
|
|
|
|
||||||
Stock options (2)
|
—
|
|
|
—
|
|
|
—
|
|
|||
Directors' stock performance units (2)
|
—
|
|
|
—
|
|
|
—
|
|
|||
Diluted weighted-average shares outstanding (1)(2)
|
15,699
|
|
|
15,638
|
|
|
15,536
|
|
|||
Diluted earnings (loss) per share - continuing operations
|
$
|
(0.59
|
)
|
|
$
|
(0.33
|
)
|
|
$
|
(0.15
|
)
|
(1)
|
Includes Common and Class B Common shares, excluding
434
unvested participating securities, in thousands.
|
(2)
|
Shares issuable under stock option plans where the exercise price is greater than the average market price of the Company's Common Stock during the relevant period and directors' stock performance units have been excluded to the extent they are anti-dilutive. Aggregate shares excluded were
448
in
2017
,
220
in
2016
and
333
in
2015
.
|
|
Number of Shares
|
|
Weighted-Average Grant-Date Fair Value
|
|||
Outstanding at December 27, 2014
|
357,239
|
|
|
$
|
7.92
|
|
Granted
|
224,625
|
|
|
9.36
|
|
|
Vested
|
(155,991
|
)
|
|
7.18
|
|
|
Forfeited
|
(9,078
|
)
|
|
10.97
|
|
|
Outstanding at December 26, 2015
|
416,795
|
|
|
8.90
|
|
|
Granted
|
149,215
|
|
|
4.36
|
|
|
Vested
|
(107,318
|
)
|
|
8.88
|
|
|
Forfeited
|
(1,314
|
)
|
|
15.68
|
|
|
Outstanding at December 31, 2016
|
457,378
|
|
|
7.41
|
|
|
Granted
|
60,000
|
|
|
3.70
|
|
|
Vested
|
(78,908
|
)
|
|
8.79
|
|
|
Forfeited
|
(4,629
|
)
|
|
5.96
|
|
|
Outstanding at December 30, 2017
|
433,841
|
|
|
$
|
6.66
|
|
|
2017
|
|
2016 (1)
|
|
2015 (1)
|
|||
Expected Volatility
|
47.80
|
%
|
|
—
|
%
|
|
—
|
%
|
Risk-free interest rate
|
1.79
|
%
|
|
—
|
%
|
|
—
|
%
|
Dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Expected life of options (yrs)
|
5
|
|
|
0
|
|
|
0
|
|
|
Number of Shares
|
|
Weighted-Average Exercise Price
|
|
Weighted-Average Remaining Contractual Life (in years)
|
Weighted-Average Fair Value of Options Granted During the Year
|
||||||
Outstanding at December 27, 2014
|
439,235
|
|
|
$
|
10.31
|
|
|
|
|
$
|
—
|
|
Exercised
|
(89,435
|
)
|
|
6.78
|
|
|
|
|
—
|
|
||
Forfeited
|
(246,300
|
)
|
|
13.82
|
|
|
|
|
—
|
|
||
Outstanding at December 26, 2015
|
103,500
|
|
|
5.00
|
|
|
|
|
—
|
|
||
Exercised
|
—
|
|
|
—
|
|
|
|
|
—
|
|
||
Forfeited
|
—
|
|
|
—
|
|
|
|
|
—
|
|
||
Outstanding at December 31, 2016
|
103,500
|
|
|
5.00
|
|
|
|
|
—
|
|
||
Granted
|
203,000
|
|
|
4.30
|
|
|
|
|
1.51
|
|
||
Exercised
|
—
|
|
|
—
|
|
|
|
|
—
|
|
||
Forfeited
|
—
|
|
|
—
|
|
|
|
|
—
|
|
||
Outstanding at December 30, 2017
|
306,500
|
|
|
$
|
4.54
|
|
|
3.5
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|||||
Options exercisable at:
|
|
|
|
|
|
|
|
|||||
December 26, 2015
|
103,500
|
|
|
$
|
5.00
|
|
|
|
|
—
|
|
|
December 31, 2016
|
103,500
|
|
|
5.00
|
|
|
|
|
—
|
|
||
December 30, 2017
|
103,500
|
|
|
5.00
|
|
|
1.8
|
|
—
|
|
|
Interest Rate Swaps
|
|
Post-Retirement Liabilities
|
|
Total
|
||||||
Balance at December 27, 2014
|
(1,841
|
)
|
|
328
|
|
|
(1,513
|
)
|
|||
Unrealized loss on interest rate swaps, net of tax of $916
|
(1,494
|
)
|
|
—
|
|
|
(1,494
|
)
|
|||
Reclassification of loss into earnings from interest rate swaps, net of tax of $295
|
482
|
|
|
—
|
|
|
482
|
|
|||
Unrecognized net actuarial gain on postretirement benefit plans, net of tax of $18
|
—
|
|
|
30
|
|
|
30
|
|
|||
Reclassification of net actuarial gain into earnings from postretirement benefit plans, net of tax of $15
|
—
|
|
|
(25
|
)
|
|
(25
|
)
|
|||
Reclassification of prior service credits into earnings from postretirement benefit plans, net of tax of $33
|
—
|
|
|
(53
|
)
|
|
(53
|
)
|
|||
Balance at December 26, 2015
|
(2,853
|
)
|
|
280
|
|
|
(2,573
|
)
|
|||
Unrealized loss on interest rate swaps, net of tax of $100
|
(163
|
)
|
|
—
|
|
|
(163
|
)
|
|||
Reclassification of loss into earnings from interest rate swaps, net of tax of $491
|
800
|
|
|
—
|
|
|
800
|
|
|||
Unrecognized net actuarial loss on postretirement benefit plans, net of tax of $1
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
|||
Reclassification of net actuarial gain into earnings from postretirement benefit plans, net of tax of $13
|
—
|
|
|
(20
|
)
|
|
(20
|
)
|
|||
Reclassification of prior service credits into earnings from postretirement benefit plans, net of tax of $2
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
|||
Balance at December 31, 2016
|
(2,216
|
)
|
|
256
|
|
|
(1,960
|
)
|
|||
Unrealized gain on interest rate swaps, net of tax of $68
|
112
|
|
|
—
|
|
|
112
|
|
|||
Reclassification of loss into earnings from interest rate swaps, net of tax of $475
|
775
|
|
|
—
|
|
|
775
|
|
|||
Unrecognized net actuarial gain on postretirement benefit plans, net of tax of $4
|
—
|
|
|
7
|
|
|
7
|
|
|||
Reclassification of net actuarial gain into earnings from postretirement benefit plans, net of tax of $11
|
—
|
|
|
(19
|
)
|
|
(19
|
)
|
|||
Reclassification of prior service credits into earnings from postretirement benefit plans, net of tax of $1
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
|||
Reclassification of stranded tax effects
|
(258
|
)
|
|
47
|
|
|
(211
|
)
|
|||
Balance at December 30, 2017
|
$
|
(1,587
|
)
|
|
$
|
288
|
|
|
$
|
(1,299
|
)
|
|
Capital
Leases
|
|
Operating
Leases
|
||||
2018
|
$
|
5,006
|
|
|
$
|
3,709
|
|
2019
|
3,898
|
|
|
2,854
|
|
||
2020
|
3,506
|
|
|
2,364
|
|
||
2021
|
2,684
|
|
|
1,882
|
|
||
2022
|
956
|
|
|
1,451
|
|
||
Thereafter
|
244
|
|
|
3,525
|
|
||
Total commitments
|
16,294
|
|
|
15,785
|
|
||
Less amounts representing interest
|
(1,764
|
)
|
|
—
|
|
||
Total
|
$
|
14,530
|
|
|
$
|
15,785
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
Other operating expense, net:
|
|
|
|
|
|
||||||
(Gain) loss on property, plant and equipment disposals
|
$
|
170
|
|
|
$
|
725
|
|
|
$
|
(114
|
)
|
(Gain) loss on currency exchanges
|
(72
|
)
|
|
167
|
|
|
602
|
|
|||
Amortization of intangibles
|
306
|
|
|
305
|
|
|
305
|
|
|||
Retirement expenses
|
155
|
|
|
154
|
|
|
212
|
|
|||
BP settlement gain (1)
|
—
|
|
|
(841
|
)
|
|
—
|
|
|||
Miscellaneous (income) expense
|
(118
|
)
|
|
(109
|
)
|
|
(133
|
)
|
|||
Other operating expense, net
|
$
|
441
|
|
|
$
|
401
|
|
|
$
|
872
|
|
(1)
|
On November 21, 2016, the Company entered into a full and final release agreement with BP Exploration and Production, Inc. and various related entities pursuant to which the Company released any and all claims related to the Deepwater Horizon oil spill which occurred on April 20, 2010. In exchange for this release, the Company received a net amount of
$841
from the settlement.
|
|
2017
|
|
2016
|
|
2015
|
||||||
Other expense, net:
|
|
|
|
|
|
||||||
Earnings from equity investments
|
—
|
|
|
—
|
|
|
14
|
|
|||
Miscellaneous (income) expense
|
39
|
|
|
22
|
|
|
33
|
|
|||
Other expense, net
|
$
|
39
|
|
|
$
|
22
|
|
|
$
|
47
|
|
|
|
|
|
|
|
|
|
|
As of December 30, 2017
|
||||||||||||||
|
Accrued Balance at December 31, 2016
|
|
2017 Expenses (1)
|
|
2017 Cash Payments
|
|
Accrued Balance at December 30, 2017
|
|
Total Costs Incurred to Date
|
|
Total Expected Costs
|
||||||||||||
Warehousing, Distribution and Manufacturing Consolidation Plan
|
$
|
266
|
|
|
$
|
(4
|
)
|
|
$
|
262
|
|
|
$
|
—
|
|
|
$
|
7,440
|
|
|
$
|
7,440
|
|
Corporate Office Consolidation Plan
|
248
|
|
|
4
|
|
|
81
|
|
|
171
|
|
|
807
|
|
|
807
|
|
||||||
Profit Improvement Plan
|
—
|
|
|
636
|
|
|
302
|
|
|
334
|
|
|
636
|
|
|
1,382
|
|
||||||
Total All Plans
|
$
|
514
|
|
|
$
|
636
|
|
|
$
|
645
|
|
|
$
|
505
|
|
|
$
|
8,883
|
|
|
$
|
9,629
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Accrued Balance at December 26, 2015
|
|
2016 Expenses (1)
|
|
2016 Cash Payments
|
|
Accrued Balance at December 31, 2016
|
|
|
|
|
||||||||||||
Warehousing, Distribution and Manufacturing Consolidation Plan
|
$
|
—
|
|
|
$
|
1,381
|
|
|
$
|
1,115
|
|
|
$
|
266
|
|
|
|
|
|
||||
Corporate Office Consolidation Plan
|
341
|
|
|
75
|
|
|
168
|
|
|
248
|
|
|
|
|
|
||||||||
Total All Plans
|
$
|
341
|
|
|
$
|
1,456
|
|
|
$
|
1,283
|
|
|
$
|
514
|
|
|
|
|
|
|
2017
|
|
2016
|
|
2015
|
||||||
|
|
|
|
|
|
||||||
Net sales - Carousel operations
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
417
|
|
|
|
|
|
|
|
||||||
Loss from discontinued operations:
|
|
|
|
|
|
||||||
Loss from Carousel operations
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(116
|
)
|
Workers' compensation costs from former textile operations
|
(155
|
)
|
|
(2
|
)
|
|
(53
|
)
|
|||
Environmental remediation costs from former textile operations
|
(225
|
)
|
|
(216
|
)
|
|
(68
|
)
|
|||
Loss from discontinued operations, before taxes
|
$
|
(380
|
)
|
|
$
|
(218
|
)
|
|
$
|
(237
|
)
|
Income tax benefit
|
(147
|
)
|
|
(87
|
)
|
|
(89
|
)
|
|||
Loss from discontinued operations, net of tax
|
$
|
(233
|
)
|
|
$
|
(131
|
)
|
|
$
|
(148
|
)
|
|
|
|
|
|
|
||||||
Income on disposal of Carousel discontinued operations before income taxes
|
$
|
—
|
|
|
$
|
100
|
|
|
$
|
—
|
|
Income tax provision
|
—
|
|
|
40
|
|
|
—
|
|
|||
Income on disposal of discontinued operations, net of tax
|
$
|
—
|
|
|
$
|
60
|
|
|
$
|
—
|
|
Description
|
|
Balance at Beginning of Year
|
|
Additions - Charged to Costs and Expenses
|
|
Additions - Charged to Other Account - Describe
|
|
Deductions - Describe
|
|
Balance at End of Year
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year ended December 30, 2017:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserves deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$
|
107
|
|
|
$
|
70
|
|
|
$
|
—
|
|
|
$
|
44
|
|
(1)
|
$
|
133
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserves classified as liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for claims, allowances and warranties
|
|
6,020
|
|
|
8,291
|
|
|
—
|
|
|
9,020
|
|
(2)
|
5,291
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year ended December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserves deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$
|
470
|
|
|
$
|
38
|
|
|
$
|
—
|
|
|
$
|
401
|
|
(1)
|
$
|
107
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserves classified as liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for claims, allowances and warranties
|
|
5,684
|
|
|
10,362
|
|
|
—
|
|
|
10,026
|
|
(2)
|
6,020
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Year ended December 26, 2015:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserves deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$
|
450
|
|
|
$
|
146
|
|
|
$
|
—
|
|
|
$
|
126
|
|
(1)
|
$
|
470
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserves classified as liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Provision for claims, allowances and warranties
|
|
4,647
|
|
|
14,254
|
|
|
—
|
|
|
13,217
|
|
(2)
|
5,684
|
|
EXHIBIT NO.
|
DESCRIPTION
|
(1.1)*
|
|
(2.1)*
|
|
(3.1)*
|
|
(3.2)*
|
|
(5.1)*
|
|
(10.1)*
|
The Dixie Group, Inc. New Non-qualified Retirement Savings Plan effective August 1, 1999. (Incorporated by reference to Exhibit (10.1) to Dixie's Quarterly Report on Form 10-Q for the quarter ended June 26, 1999.)**
|
(10.2)*
|
|
(10.3)*
|
|
(10.4)*
|
|
(10.5)*
|
|
(10.6)*
|
|
(10.7)*
|
|
(10.8)*
|
|
(10.9)*
|
|
(10.10)*
|
|
(10.11)*
|
|
(10.12)*
|
|
(10.13)*
|
(10.14)*
|
|
(10.15)*
|
|
(10.16)*
|
|
(10.17)*
|
|
(10.18)*
|
|
(10.19)*
|
|
(10.20)*
|
|
(10.21)*
|
|
(10.22)*
|
|
(10.23)*
|
|
(10.24)*
|
|
(10.25)*
|
|
(10.26)*
|
|
(10.27)*
|
|
(10.28)*
|
|
(10.29)*
|
|
(10.30)*
|
|
(10.31)*
|
|
(10.32)*
|
|
(10.33)*
|
(10.34)*
|
|
(10.35)*
|
|
(10.36)*
|
|
(10.37)*
|
|
(10.38)*
|
|
(10.39)*
|
|
(10.40)*
|
|
(10.41)*
|
|
(10.42)*
|
|
(10.43)*
|
|
(10.44)*
|
|
(10.45)*
|
|
(10.46)*
|
|
(10.47)*
|
|
(10.48)*
|
|
(10.49)*
|
|
(10.50)*
|
|
(10.51)*
|
|
(10.52)*
|
(10.53)*
|
|
(10.54)*
|
|
(10.55)*
|
|
(10.56)*
|
|
(10.57)*
|
|
(10.58)*
|
|
(10.59)*
|
|
(10.60)*
|
|
(10.61)*
|
|
(10.62)*
|
|
(10.63)*
|
|
(10.64)*
|
|
(10.65)*
|
|
(10.66)*
|
|
(10.67)*
|
|
(10.68)*
|
|
(10.69)*
|
|
(10.70)*
|
|
(10.71)*
|
|
(10.72)*
|
|
(10.73)*
|
|
(10.74)*
|
|
(10.75)*
|
|
(10.76)*
|
|
(10.77)*
|
|
(10.78)
|
|
(14)*
|
SUBSIDIARY
|
|
STATE/COUNTRY OF INCORPORATION
|
Fabrica International, Inc.
|
|
CA
|
C-Knit Apparel, Inc.
|
|
TN
|
TDG Operations, LLC
|
|
GA
|
Candlewick Yarns, LLC
|
|
AL
|
Dixie Commercial Consulting (Shanghai) Company Limited
|
|
Shanghai, China
|
•
|
Registration Statement (Form S-8 No 333-134779) pertaining to The Dixie Group, Inc. 2006 Stock Awards Plan,
|
•
|
Registration Statement (Form S-8 No 333-89994) pertaining to The Dixie Group, Inc. Stock Incentive Plan,
|
•
|
Registration Statement (Form S-8 No 033-59564) pertaining to the Agreement and Plan of Merger by and among Dixie Yarns, Inc., Carriage Acquisitions, Inc. and Carriage Industries, Inc., dated as of November 3, 1992,
|
•
|
Registration Statement (Form S-8 No 333-87534) pertaining to The Dixie Group, Inc. Stock Incentive Plan,
|
•
|
Registration Statement (Form S-8 No 333-81163) pertaining to The Dixie Group, Inc. Incentive Stock Plan,
|
•
|
Registration Statement (Form S-8 No 333-80971) pertaining to The Dixie Group, Inc. Core Leadership Team Stock Ownership Plan,
|
•
|
Registration Statement (Form S-8 No 333-118504) pertaining to The Dixie Group, Inc. Directors Stock Plan,
|
•
|
Registration Statement (Form S-8 No 333-168412) pertaining to The Dixie Group, Inc. Amended and Restated 2006 Stock Awards Plan,
|
•
|
Registration Statement (Form S-8 No 333-188321) pertaining to The Dixie Group, Inc. Amended and Restated 2006 Stock Awards Plan,
|
•
|
Registration Statement (Form S-3 No 333-194571) of The Dixie Group, Inc. pertaining to the offering 2,500,000 shares of common stock, and
|
•
|
Registration Statement (Form S-8 No 333-211157) pertaining to The Dixie Group, Inc. 2016 Incentive Compensation Plan;
|
1.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
2.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
3.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
4.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: March 13, 2018
|
|
/s/
DANIEL K. FRIERSON
|
|
|
Daniel K. Frierson
|
|
|
Chief Executive Officer
|
|
|
The Dixie Group, Inc.
|
1.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
2.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
3.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
4.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: March 13, 2018
|
/s/
JON A. FAULKNER
|
|
Jon A. Faulkner
|
|
Chief Financial Officer
|
|
The Dixie Group, Inc.
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/
DANIEL K. FRIERSON
|
|
Daniel K. Frierson, Chief Executive Officer
|
|
Date:
|
March 13, 2018
|
(1)
|
the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/
JON A. FAULKNER
|
|
Jon A. Faulkner, Chief Financial Officer
|
|
Date:
|
March 13, 2018
|