The Dixie Group Inc., an established player in the carpets and rugs industry, is on the brink of being delisted from the Nasdaq Stock Market. The company, headquartered in Dalton, Georgia, has not met the Nasdaq's minimum bid price requirement and is now facing the consequences.
On Monday, the company received a notification from Nasdaq that it had failed to comply with the $1.00 minimum bid price per share rule, a standard for continued listing on the Nasdaq Capital Market. This development follows an earlier notice on March 26, 2024, when Dixie Group was granted a 180-day extension to rectify the bid price deficiency.
Dixie Group has a short window until October 1, 2024, to appeal this delisting notice. Should they choose to challenge the decision, the delisting process will be put on hold until the Nasdaq listing qualifications hearing panel has made a ruling. However, if the company opts not to appeal, trading of its common stock will be suspended at market open on October 3, 2024.
Subsequently, a Form 25-NSE will be filed with the Securities and Exchange Commission, which will effectively remove Dixie Group's securities from listing and registration on the Nasdaq Stock Market.
The company, which operates under the ticker symbol NASDAQ:DXYN, has been a recognized entity in the manufacturing sector, specifically categorized under the Standard Industrial Classification code 2273 for carpets and rugs. The Dixie Group, previously known as Dixie Yarns Inc. and Dixie Mercerizing Co., has a history dating back to changes in name and structure from as early as 1967.
As of now, the company's leadership, including Chief Financial Officer Allen L. Danzey, has not publicly disclosed their intended course of action regarding the appeal. The information detailed in this article is based on a press release statement and reflects the latest developments as reported by the company in compliance with SEC regulations.
In other recent news, a company has made a remarkable rebound to profitability in Q2 2024, despite a 4.7% drop in net sales to $70.5 million. This financial turnaround was primarily due to an improved gross profit margin of 28.1% and an increase in operating income to $2.3 million from $300,000 in the previous year. The company also reported a net income of $700,000 from continuing operations, contrasting with a $1.6 million net loss in the same period last year.
These positive developments came amid the company's ongoing cost-cutting efforts, which resulted in savings between $10 million to $12 million in 2024. The company also entered a 10-year sublease agreement for its Saraland, Alabama facility, projected to contribute approximately $1.8 million in other income annually.
However, the company's hard surface business experienced a 15% to 20% decline in Q2 with no expected improvement in Q3. Despite this, the company's soft surface business is gaining market share and is performing better than the industry average.
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