Bassett Furniture Industries Inc. announced today that it is moving production from its Dublin, Ga., wood bedroom plant to its Superior Lines plant in Bassett, Va. The closure of the Dublin facility will occur over the next 75 days and affect approximately 300 employees (approximately 11% of the Company’s workforce). The Company expects to add approximately 50 employees at its Superior Lines plant in Bassett over the next several months.

Robert H. Spilman Jr.
President and chief executive officer
“This is a decision we had to make in order to continue to provide both style and value to our customers and a return for our shareholders. The most difficult part is the impact on our workers in Dublin, who have been extremely dedicated and loyal employees for many years. We will provide these employees with outplacement assistance and severance to make the transition as smooth as possible under the circumstances.”

Spilman added, “We will continue to pursue a blended strategy for our wood products – domestically manufacturing in our four remaining facilities and sourcing compelling product from overseas. To improve results, it is important that the remaining facilities operate at full schedules and that we continue to invest in technology, equipment and process improvements at these locations.”

The Company plans to realize the benefits of greater efficiencies and cost savings with increased volume at its Superior Lines facility. Those savings during the next 12 months should exceed the first quarter 2003 charge, estimated in the range of $3.0 to $3.5 million (approximately 18 to 21 cents per share net of taxes), the Company expects to take in connection with the consolidation. The charge will be for severance and related employee costs, and the write-down of fixed assets at the Dublin facility.

As previously announced, fiscal 2003 sales have started out slower than expected. January retail activity, although improved over December levels, remains below planned levels and below historically high sales levels for January 2002. First quarter 2003 sales and earnings will be below fiscal 2002 levels. To combat the soft retail environment, the Company has taken several additional actions which reduce the overall fixed cost structure of the business while staying focused on its core growth strategies. Consolidating the Dublin plant and eliminating approximately 20 corporate support positions is expected to reduce the annual operating costs of the business by over $7 million dollars. Second, the Company has added two new sales promotions to spur demand in its dedicated retail stores. Third, the Company is introducing two new major collections (one domestically manufactured and one imported) at the upcoming April Furniture Market plus two other dining room groups, a bedroom group and an extension to the upholstery and occasional assortment in the Chris Madden CollectionÔ by Bassett.