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Knoll continues to reduce bank debt, leverage ratio in third quarter
By Jennifer Lanning Drey
Savannah, Ga., Oct. 15 - Knoll, Inc. reduced its bank debt to $255 million in the third quarter after paying down $22 million during the period, Barry McCabe, Knoll's chief financial officer, said Friday during the company's third-quarter earnings conference call.
Knoll's leverage ratio as calculated under its bank agreement improved to 2.88 to 1 at Sept. 30, compared with 3.17 to 1 at the end of the second quarter, McCabe said.
The company is comfortably in compliance with its bank covenants and expects its leverage to sequentially improve moving through the balance of 2010, he said.
"Over the past 16 months, in a terrible economic environment, we have reduced our outstanding bank debt by over $100 million and aggressively managed our working capital requirements to the lower sales levels," McCabe said.
For the third quarter, Knoll reported net sales of $202.1 million, which represented an 11.5% increase over sales in the same period of 2009. The operating profit increased to $19.1 million, up 13.7% from the prior-year period.
The company benefited from improved demand during the third quarter and believes it is in the midst of a genuine recovery, Andrew Cogan, its chief executive officer, said Friday.
Knoll ended the third quarter with cash and cash equivalents of $7.81 million.
Cash generated from operations during the third quarter was $20.2 million. The figure compared with $29.5 million of cash generated from operations in the same period of 2009.
Knoll is an East Greenville, Pa.-based designer and manufacturer of branded office furniture products and textiles.
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