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Natuzzi S.p.A. Reports Fourth Quarter and Full Year 2009 Financial Results

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The Board of Directors of Natuzzi S.p.A. announced financial results for the fourth quarter and full year 2009.

Fourth Quarter 2009 Summary

Total Net Sales of € 152.1 million as compared to € 182.1 million in 4Q 2008; Industrial Margin of € 59.3 million from € 58.4 million in the same quarter of 2008; Operating income of € 2.1 million, versus an Operating loss of € 5.5 million in 4Q 2008; Group Net Loss was € 2.5 million compared to a net loss of € 19.8 million in the same period of 2008; Net Financial Position was € 58.5 million compared to € 33.8 million for full year 2008.

Fourth Quarter 2009 Financial Results

Net sales for the fourth quarter of 2009 totaled € 152.1 million decreasing by 16.5% compared to the same quarter of last year but a clear recovery with respect to the previous quarters of 2009, that confirms the effectiveness of the actions taken to face the global economic crisis. Upholstery Net sales were € 133.9 million compared to € 161.1 million in fourth quarter of 2008. The contribution by geographic area was: Europe 45.6% (excluding Italy); Americas 32.8%; Italy 11.4% and Rest of the World 10.2%.

Industrial Margin totaled € 59.3 million, increasing from 32.0% in 2008 to 39.0% in 2009 as a percentage of net sales. Such improvement is mainly due to a raw material price reduction and to an improvement in materials consumption.

Operating income was € 2.1 million compared to an operating loss of € 5.5 million in 4Q 2008.

Full Year 2009 Financial Result

Net sales for full year 2009 were € 515.4 million, decreasing by 22.6% with respect to € 666.0 million reported in 2008. Upholstery Sales were € 450.6 million down by 23.3% from € 587.8 million in 2008. The contribution by geographic area was: Europe 46.7% (excluding Italy); Americas 31.0%; Italy 11.9% and Rest of the World 10.4%.

For full year 2009 the Group reported an Industrial margin of €185.6 million, or 36.0% on total net sales, up from 28.1% in 2008. Operating Loss was € 10.6 million compared to an operating loss of € 35.0 million reported in 2008.

The Group reported a Net Result of € 17.7 million for full year 2009 as compared with a net loss of € 61.9 million for 2008, with an improvement of approximately € 44.2 million.

Balance Sheet Highlights

Natuzzi Group ended Year 2009 with a Net Financial Position of €58.5 million. Net cash increase of €24.7 million was mainly due to a reduction in working capital. Long term debt totaled €5.9 million. Shareholder’s Equity was €325.0 million.

Pasquale Natuzzi, Chairman and CEO, commented: “We are very pleased with the Natuzzi Group positive trend in the key economic margins occurred during 2009. The 2009 EBIT at Group level, although still negative, recorded a significant improvement with respect to the previous year. Such result, achieved despite decreasing sales as a consequence of the ongoing global crisis, is mainly due to the deep restructuring process started in 2009 and still in progress.

We are aware that a strong work must be done to get a positive EBIT in 2010, considering also the uncertainties of current economic environment. Bringing the Group back to profitability is an ambitious but a reachable goal toward which the whole management is fully committed”.

About Natuzzi: Founded in 1959 by Pasquale Natuzzi, Natuzzi S.p.A. designs and manufactures a broad collection of residential upholstered furniture. With consolidated revenues of EUR 515.4 million in 2009, Natuzzi is Italy's largest furniture manufacturer. Natuzzi Group exports its innovative high-quality sofas and armchairs to 123 markets on five continents under two brands, Natuzzi and Italsofa. Cutting-edge design, superior Italian craftsmanship and advanced, vertically integrated manufacturing operations underpin the Company's market leadership. Natuzzi S.p.A. has been listed on the New York Stock Exchange since May 1993. The Company is ISO 9001 and 14001 certified.

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