Jennifer Convertibles Reports For Fourth Quarter and Fiscal Year End

WOODBURY, N.Y., Nov. 26, 2010 /PRNewswire-FirstCall/ -- Jennifer Convertibles, Inc. (Pink Sheets: JENNQ) announced today its financial results for the fourth quarter and fiscal year ended August 28, 2010.

For the fourth quarter, revenue from continuing operations increased by 11.8% to $19,992,000 from the $17,875,000 reported for the same period last year.  For the fiscal year 2010, revenue from continuing operations increased 4.1% to $76,305,000 from the $73,287,000 reported in the same period last year.  

For the fourth quarter, the net loss was $6,275,000 or ($0.90) per basic and diluted share, compared to net loss of $5,263,000 or ($0.74) per basic and diluted share, for the same period last year.  For the fiscal year 2010, the net loss was $24,333,000 or ($3.46) per basic and diluted share, compared to net loss of $11,008,000 or ($1.55) per basic and diluted share, for the same period last year.

For the fourth quarter, operating margins from continuing operations decreased to 24.4% compared to 32.3% the same period last year. For the twelve-month period operating margins from continuing operations decreased to 25.8% compared to 30.8% for the same period last year.

For the fourth quarter, selling, general, and administrative expenses from continuing operations decreased to 31.7% as a percentage of revenue from continuing operations compared to 35.7% for the same period last year. For the twelve-month period, selling, general and administrative expenses from continuing operations increased to 38.9% compared to 34.1% for the same period last year.

During the fourth quarter, the Company closed fifty-two stores.  During fiscal 2010, the Company closed sixty-nine stores of which the operating results of fifty-three stores were reported in discontinued operations.  Loss from discontinued operations was $2,253,000 and $1,090,000 in the fourth quarter of fiscal 2010 and 2009, respectively.  For the twelve-month periods for fiscal 2010 and 2009, loss from discontinued operations amounted to $4,637,000 and $4,402,000, respectively.

With respect to the Company's previously disclosed voluntary petition for bankruptcy under Chapter 11 of the United States Bankruptcy Code, on November 19, 2010, the Company filed with the bankruptcy court, a plan of reorganization and accompanying disclosure statement and a motion seeking authorization to enter into a debtor-in-possession financing agreement with its principal supplier, all of which are subject to the bankruptcy court's approval. Although the Company intends to emerge as a going concern post-petition, there can be no assurance that the plan of reorganization will be implemented or that the Company will be able to continue as a going concern.

Harley J Greenfield CEO of Jennifer, commenting on the results of Fiscal 2010 said, "Despite the financial difficulties we have experienced, culminating with filing bankruptcy in July, we have continued to provide customers with extreme value merchandise and excellent customer service.  We intend to emerge from bankruptcy as a stronger company. In our Jennifer Division we have been able to restructure leases, close unprofitable stores, and focus on our strong markets. Our Ashley HomeStores Division continues to mature and should continue to make a significant contribution to the Company."

Mr. Greenfield added, "We look forward to continuing to provide customers stylish merchandise at incredible values."

Jennifer Convertibles is the owner and licensor of the largest group of sofabed specialty retail stores in the United States, with 72 Jennifer Convertibles® stores and is the largest specialty retailer of leather furniture with 8 Jennifer Leather stores.  As of November 24, 2010, the Company owned 80 stores and operates six licensed Ashley Furniture HomeStores.

Statements in this press release other than the statements of historical fact are "forward-looking statements."  Such statements are subject to certain risks and uncertainties, including changes in retail demand, vendor performance and other risk factors identified from time to time in the Company's filings with the Securities and Exchange Commission that could cause actual results to differ materially from any forward-looking statements.  These forward-looking statements represent the Company's judgment as of the date of the release.  The Company disclaims, however, any interest or obligations to update these forward-looking statements.

SOURCE Jennifer Convertibles, Inc.