Stanley Furniture Company reported sales and earnings for the third quarter of 2003 were up 6.3% from last year. Sales and operating income were at the high end of management's previous guidance for the quarter. Earnings per share exceeded the guidance range due to the accretion from share repurchases in the third quarter.

"We are pleased to report our sixth consecutive quarter of year-over-year sales growth," said Albert L. Prillaman, chairman. "While the overall tone of business appears to have modestly improved since the summer months, we believe this sales growth is due to market share gains, which we expect to continue. We enter the final quarter of 2003 with significant sales momentum as evidenced by a 20% increase in third quarter 2003 orders compared to the year ago quarter," Prillaman concluded.

"While our Young America(R) youth bedroom business continues to perform well, most of our sales growth this year is fueled from Stanley Collections which provides residential wood furniture for every room in the home including dining room, bedroom, home entertainment, home office and accent tables," commented Jeffrey R. Scheffer, president and chief executive officer. "We believe the growth in our Collections business this year results from market share gains and is evidence that our blended strategy is working. This strategy encompasses a blend of our efficient domestic manufacturing capabilities in focused factories with intelligent outsourcing of certain component parts and finished goods. This combination allows us to offer higher value, well-styled product without sacrificing our culture of high quality and quick delivery."

"As previously noted, approximately 20% of 2003 sales will come from sourced items. The start up costs from our sourcing initiatives combined with the operational challenges of transitioning to this blended strategy has negatively impacted our operating margins this year and will continue to do so near-term. However, we believe this approach will create a long-term competitive advantage providing continued sales growth and operating margin improvement going forward," Scheffer concluded.

The company expects fourth quarter results to be 7% to 12% higher than Q4 2002.