STAFF REPORTS
SALISBURY POST

Pillowtex, parent company of Fieldcrest Cannon, said this morning that stockholder earnings for the first half of 1999 won’t meet earlier predictions.

The company now expects to realize 40 cents per share ‘‘on a diluted basis’’ for the first quarter and 50 cents per ‘‘diluted’’ share in the second quarter. The company did not note how far the earlier predictions missed the mark.

Pillowtex attributed the ‘‘shortfall’’ mainly to extra costs of installing new computer systems in several plants, cost overruns as the company installed new product production lines and the costs of shutting down Leshner spinning and weaving operations in Opelika, Ala.

In a prepared statement issued from his Dallas, Texas, headquarters, Charles M. Hansen Jr., chairman and CEO of Pillowtex, said, ‘‘While our sales estimates are in line with analysts’ expectations, we are very disappointed with the operational costs levels. ... The implementation of new manufacturing computer systems, which are a long term benefit to the company, have placed a tremendous strain on the plants as they are set into place.

‘‘We have also incurred higher than anticipated costs to meet accelerated roll-out schedules for certain new terry introductions. Despite these costs setbacks, we believe the overall business remains strong and that our changes to systems, introductions of new products and consolidation of operations will add long term profitability to the corporation.’’