Textile maker Dan River Inc has posted a third quarter loss of $103.5 million, compared to earnings of $4.7m in the same period last year.

The loss, which included a $91.7m charge for goodwill amortisation, was caused by poor sales in home fashion lines according to a company statement.

Sales dropped to $103.7m in the third quarter from $147.4m in the same period a year earlier, and each of the company's three divisions suffered operating losses.

Similar sales are predicted by the Virginia-based manufacturer in the fourth quarter and, as a result, it will close two of its production facilities and cut back on production in the period.

Dan River estimates the closings in Tennessee and Georgia will save about $6m to $7m in annual costs which, combined with other job cuts and plant shutdowns, will reduce expenses by about $18m a year.

"Our third quarter sales were very disappointing," chairman and CEO Joseph Lanier said.

"With the announced cost savings measures fully implemented, we expect to see the benefit of those savings contribute directly to the bottom line."