FORM 10-QSECURITIES AND EXCHANGE
COMMISSIONWashington, D.C. 20549

| | (Mark one)
| | ----------

|(X) |  | QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT           OF 1934
For the quarterly period ended June 30, 2004 or
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------

| | TRANSITION
REPORT
PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the
transition period from ____________ to ____________
| | -----------------------------------------------------------------------------------------------------------------------------------------------------

| | Commission file
number I-91
| | ---------------------------

Furniture Brands
International, Inc.(Exact
name of registrant as specified in its charter)

|Delaware                        |  | 43-0337683         
|------------------------------- |  | -------------------
|(State or other jurisdiction of |  | (I.R.S. Employer   
|incorporation or organization)  |  | Identification No.)

|                                           |  |           
|------------------------------------------ |  | ----------
|101 South Hanley Road, St. Louis, Missouri |  | 63105     
|(Address of principal executive offices)   |  | (Zip Code)

|                                                   |  |               
|-------------------------------------------------- |  | --------------
|Registrant's telephone number, including area code |  | (314) 863-1100

| |                                                                                 
| | --------------------------------------------------------------------------------
| | Former name,
former address and former fiscal year, if changed since last report

| |  | Indicate by
check mark whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90 days.
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | YesX | No
| | ---- | --

| |  | Indicate by
check mark whether the registrant is an accelerated filer (as defined in Rule 12 b-2 of
the Exchange Act).
| |  | ----------------------------------------------------------------------------------------------------------------------

| | YesX | No
| | ---- | --

APPLICABLE ONLY TO
CORPORATE ISSUERS

| | Indicate the
number of shares outstanding of each of the issuer's classes of common stock, as of the
latest practicable date.
| | -----------------------------------------------------------------------------------------------------------------------------

54,721,186 shares as of
July 31, 2004

---

PART I FINANCIAL
INFORMATION

Item 1.  
      Financial Statements

Consolidated Financial
Statements for the quarter ended June 30, 2004.

| | Consolidated Balance
Sheets
| | ---------------------------

| | Consolidated Statements
of Operations:
| | --------------------------------------

| | Three Months Ended June 30, 2004
| | --------------------------------
| | Three Months Ended June 30, 2003

| | Six Months Ended June 30, 2004
| | ------------------------------
| | Six Months Ended June 30, 2003

| | Consolidated Statements
of Cash Flows:
| | --------------------------------------

| | Six Months Ended June 30, 2004
| | ------------------------------
| | Six Months Ended June 30, 2003

| | Notes to
Consolidated Financial Statements
| | ------------------------------------------

The financial
statements are unaudited,  but include all adjustments  (consisting of normal recurring
adjustments) which the management of the Company  considers  necessary  for a fair
 presentation  of the results of the period.  The results for the three months and six
months ended June 30, 2004 are not necessarily indicative of the results to be expected
for the full year.

---

FURNITURE BRANDS
INTERNATIONAL, INC. CONSOLIDATED BALANCE SHEETS (Dollars in thousands) (Unaudited)

|                                                |  |  |   | June 30,  |   |   | December 31,
|----------------------------------------------- |  |  | - | --------- | - | - | ------------
|                                                |  |  |   | 2004      |   |   | 2003        
|ASSETS                                          |  | 
|                                                |  |  |   |           |   |   |             
|Current assets:                                 |  | 
|Cash and cash equivalents                       |  |  | $ | 56,550    |   | $ | 71,668      
|Receivables, less allowances of $20,440         |  | 
|($19,378 at December 31, 2003)                  |  |  |   | 372,458   |   |   | 366,448     
|Inventories...(Note 1)                          |  |  |   | 430,377   |   |   | 414,684     
|Deferred income taxes                           |  |  |   | 25,602    |   |   | 25,563      
|Prepaid expenses and other current assets       |  |  |   | 11,560    |   |   | 7,689       
|Total current assets                            |  |  |   | 896,547   |   |   | 886,052     
|                                                |  |  |   |           |   |   |             
|Property, plant and equipment                   |  |  |   | 680,356   |   |   | 673,931     
|Less accumulated depreciation                   |  |  |   | 382,269   |   |   | 363,368     
|Net property, plant and equipment               |  |  |   | 298,087   |   |   | 310,563     
|                                                |  |  |   |           |   |   |             
|Goodwill                                        |  |  |   | 183,789   |   |   | 183,789     
|Other intangible assets                         |  |  |   | 169,671   |   |   | 169,671     
|Other assets                                    |  |  |   | 34,580    |   |   | 28,184      
|                                                |  |  | $ | 1,582,674 |   | $ | 1,578,259   
|                                                |  |  |   |           |   |   |             
|LIABILITIES AND SHAREHOLDERS' EQUITY            |  | 
|                                                |  |  |   |           |   |   |             
|Current liabilities:                            |  | 
|Accrued interest expense                        |  |  | $ | 1,025     |   | $ | 1,992       
|Accounts payable and other accrued expenses     |  |  |   | 184,652   |   |   | 180,827     
|Total current liabilities                       |  |  |   | 185,677   |   |   | 182,819     
|                                                |  |  |   |           |   |   |             
|Long-term debt                                  |  |  |   | 302,400   |   |   | 303,200     
|Deferred income taxes                           |  |  |   | 78,641    |   |   | 69,796      
|Other long-term liabilities                     |  |  |   | 42,445    |   |   | 55,542      
|                                                |  |  |   |           |   |   |             
|Shareholders' equity:                           |  | 
|Preferred stock, authorized 10,000,000          |  | 
|Shares, no par value - issued, none             |  |  |   | --        |   |   | --          
|Common stock, authorized 200,000,000 shares,    |  | 
|$1.00 stated value - issued 56,482,541          |  | 
|Shares at June 30, 2004 and 56,277,066          |  | 
|shares at December 31, 2003                     |  |  |   | 56,483    |   |   | 56,277      
|Paid-in capital                                 |  |  |   | 227,923   |   |   | 221,388     
|Retained earnings                               |  |  |   | 762,760   |   |   | 726,932     
|Accumulated other comprehensive income (Note 3) |  |  |   | (24,090   | ) |   | (31,446     
|Treasury stock at cost (1,761,355 shares at     |  | 
|June 30, 2004 and 330,409 shares at             |  | 
|December 31, 2003)                              |  |  |   | (49,565   | ) |   | (6,249      
|Total shareholders' equity                      |  |  |   | 973,511   |   |   | 966,902     
|                                                |  |  | $ | 1,582,674 |   | $ | 1,578,259   
|                                                |  | 

See accompanying notes to
consolidated financial statements.

---

FURNITURE BRANDS
INTERNATIONAL, INC.CONSOLIDATED STATEMENTS
OF OPERATIONS(Dollars in thousands
except per share data)(Unaudited)

|                                             |  |  |   |              |  |   |              | 
|-------------------------------------------- |  |  | - | ------------ |  | - | ------------ | 
|                                             |  |  |   | Three Months |  |   | Three Months | 
|                                             |  |  |   | Ended        |  |   | Ended        | 
|                                             |  |  |   | June 30,     |  |   | June 30,     | 
|                                             |  |  |   | 2004         |  |   | 2003         | 
|                                             |  |  |   |              |  |   |              | 
|Net sales                                    |  |  | $ | 575,682      |  | $ | 579,612      | 
|                                             |  |  |   |              |  |   |              | 
|Costs and expenses:                          |  | 
|Cost of operations                           |  |  |   | 413,728      |  |   | 420,557      | 
|                                             |  |  |   |              |  |   |              | 
|Selling, general and administrative expenses |  |  |   | 120,085      |  |   | 105,414      | 
|                                             |  |  |   |              |  |   |              | 
|Depreciation and amortization                |  |  |   | 12,606       |  |   | 12,614       | 
|                                             |  |  |   |              |  |   |              | 
|Earnings from operations                     |  |  |   | 29,263       |  |   | 41,027       | 
|                                             |  |  |   |              |  |   |              | 
|Interest expense                             |  |  |   | 3,934        |  |   | 4,868        | 
|                                             |  |  |   |              |  |   |              | 
|Other income, net                            |  |  |   | 467          |  |   | 959          | 
|                                             |  |  |   |              |  |   |              | 
|Earnings before income tax expense           |  |  |   | 25,796       |  |   | 37,118       | 
|                                             |  |  |   |              |  |   |              | 
|Income tax expense                           |  |  |   | 9,194        |  |   | 13,543       | 
|                                             |  |  |   |              |  |   |              | 
|Net earnings                                 |  |  | $ | 16,602       |  | $ | 23,575       | 
|                                             |  |  |   |              |  |   |              | 
|Net earnings per common share:               |  | 
|                                             |  |  |   |              |  |   |              | 
|Basic                                        |  |  | $ | 0.30         |  | $ | 0.42         | 
|                                             |  |  |   |              |  |   |              | 
|Diluted                                      |  |  | $ | 0.30         |  | $ | 0.42         | 
|                                             |  |  |   |              |  |   |              | 
|Weighted average common shares outstanding   |  | 
|(Note 2):                                    |  | 
|                                             |  |  |   |              |  |   |              | 
|Basic                                        |  |  |   | 55,301,296   |  |   | 55,697,528   | 
|                                             |  |  |   |              |  |   |              | 
|Diluted                                      |  |  |   | 55,921,396   |  |   | 56,216,090   | 
|                                             |  | 

See accompanying notes to
consolidated financial statements.

---

FURNITURE BRANDS
INTERNATIONAL, INC.CONSOLIDATED STATEMENTS
OF OPERATIONS(Dollars in thousands
except per share data)(Unaudited)

|                                             |  |  |   |            |  |   |            | 
|-------------------------------------------- |  |  | - | ---------- |  | - | ---------- | 
|                                             |  |  |   | Six Months |  |   | Six Months | 
|                                             |  |  |   | Ended      |  |   | Ended      | 
|                                             |  |  |   | June 30,   |  |   | June 30,   | 
|                                             |  |  |   | 2004       |  |   | 2003       | 
|                                             |  |  |   |            |  |   |            | 
|Net sales                                    |  |  | $ | 1,234,213  |  | $ | 1,193,456  | 
|                                             |  |  |   |            |  |   |            | 
|Costs and expenses:                          |  | 
|Cost of operations                           |  |  |   | 884,613    |  |   | 857,056    | 
|                                             |  |  |   |            |  |   |            | 
|Selling, general and administrative expenses |  |  |   | 238,888    |  |   | 219,602    | 
|                                             |  |  |   |            |  |   |            | 
|Depreciation and amortization                |  |  |   | 25,223     |  |   | 25,518     | 
|                                             |  |  |   |            |  |   |            | 
|Earnings from operations                     |  |  |   | 85,489     |  |   | 91,280     | 
|                                             |  |  |   |            |  |   |            | 
|Interest expense                             |  |  |   | 8,860      |  |   | 9,925      | 
|                                             |  |  |   |            |  |   |            | 
|Other income, net                            |  |  |   | 1,174      |  |   | 1,728      | 
|                                             |  |  |   |            |  |   |            | 
|Earnings before income tax expense           |  |  |   | 77,803     |  |   | 83,083     | 
|                                             |  |  |   |            |  |   |            | 
|Income tax expense                           |  |  |   | 27,992     |  |   | 30,467     | 
|                                             |  |  |   |            |  |   |            | 
|Net earnings                                 |  |  | $ | 49,811     |  | $ | 52,616     | 
|                                             |  |  |   |            |  |   |            | 
|Net earnings per common share:               |  | 
|                                             |  |  |   |            |  |   |            | 
|Basic                                        |  |  | $ | 0.89       |  | $ | 0.95       | 
|                                             |  |  |   |            |  |   |            | 
|Diluted                                      |  |  | $ | 0.88       |  | $ | 0.94       | 
|                                             |  |  |   |            |  |   |            | 
|Weighted average common shares outstanding   |  | 
|(Note 2):                                    |  | 
|                                             |  |  |   |            |  |   |            | 
|Basic                                        |  |  |   | 55,752,228 |  |   | 55,675,831 | 
|                                             |  |  |   |            |  |   |            | 
|Diluted                                      |  |  |   | 56,501,237 |  |   | 56,108,081 | 
|                                             |  | 

See accompanying notes to
consolidated financial statements.

---

FURNITURE BRANDS
INTERNATIONAL, INC.CONSOLIDATED STATEMENTS
OF CASH FLOWS(Dollars in thousands)(Unaudited)

|                                                    |  |  |   |            |   |   |            |  
|--------------------------------------------------- |  |  | - | ---------- | - | - | ---------- | -
|                                                    |  |  |   | Six Months |   |   | Six Months |  
|                                                    |  |  |   | Ended      |   |   | Ended     
|                                                    |  |  |   | June 30,   |   |   | June 30,   |  
|                                                    |  |  |   | 2004       |   |   | 2003       |  
|                                                    |  |  |   |            |   |   |           
|Cash flows from operating activities:               |  | 
|Net earnings                                        |  |  | $ | 49,811     |   | $ | 52,616     |  
|Adjustments to reconcile net earnings to net cash   |  | 
|provided by operating activities:                   |  | 
|Depreciation and amortization                       |  |  |   | 25,223     |   |   | 25,518     |  
|Other, net                                          |  |  |   | (838       | ) |   | 502        |  
|Increase in receivables                             |  |  |   | (6,010     | ) |   | (19,053    | )
|Increase in inventories                             |  |  |   | (15,693    | ) |   | (1,569     | )
|Increase in prepaid expenses and other assets       |  |  |   | (5,562     | ) |   | (2,861     | )
|Increase (decrease) in accounts payable, accrued    |  |  |   |            |   |   |            |  
|interest expense and other accrued expenses         |  |  |   | 4,866      |   |   | (8,470     | )
|Increase (decrease) in net deferred tax liabilities |  |  |   | 4,647      |   |   | (473       | )
|Increase (decrease) in other long-term liabilities  |  |  |   | (8,231     | ) |   | 7,654      |  
|Net cash provided by operating activities           |  |  |   | 48,213     |   |   | 53,864     |  
|                                                    |  |  |   |            |   |   |           
|Cash flows from investing activities:               |  | 
|Proceeds from the disposal of assets                |  |  |   | 4,645      |   |   | 157        |  
|Additions to property, plant and equipment          |  |  |   | (14,402    | ) |   | (23,745    | )
|Net cash used by investing activities               |  |  |   | (9,757     | ) |   | (23,588    | )
|                                                    |  |  |   |            |   |   |           
|Cash flows from financing activities:               |  | 
|Payments of long-term debt                          |  |  |   | (800       | ) |   | (31,600    | )
|Proceeds from the issuance of common stock          |  |  |   | 4,230      |   |   | --         |  
|Payments of cash dividends                          |  |  |   | (13,983    | ) |   | --         |  
|Proceeds from the issuance of treasury stock        |  |  |   | 7,478      |   |   | 1,177      |  
|Payments for the purchase of treasury stock         |  |  |   | (50,499    | ) |   | --         |  
|Net cash used by financing activities               |  |  |   | (53,574    | ) |   | (30,423    | )
|                                                    |  |  |   |            |   |   |           
|Net decrease in cash and cash equivalents           |  |  |   | (15,118    | ) |   | (147       | )
|Cash and cash equivalents at beginning of period    |  |  |   | 71,668     |   |   | 15,074     |  
|Cash and cash equivalents at end of period          |  |  | $ | 56,550     |   | $ | 14,927     |  
|                                                    |  |  |   |            |   |   |           
|Supplemental Disclosure:                            |  | 
|Cash payments for income taxes, net                 |  |  | $ | 23,650     |   | $ | 35,908     |  
|                                                    |  |  |   |            |   |   |           
|Cash payments for interest expense                  |  |  | $ | 9,542      |   | $ | 9,912      |  
|                                                    |  | 

See accompanying notes to
consolidated financial statements.

---

NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS (Dollars in thousands except per share data) (Unaudited)

|(1) |  | Inventories
are summarized as follows:
|--- |  | --------------------------------------

|                  |  |  |   |          |  |   |              | 
|----------------- |  |  | - | -------- |  | - | ------------ | 
|                  |  |  |   | June 30, |  |   | December 31, | 
|                  |  |  |   | 2004     |  |   | 2003         | 
|                  |  |  |   |          |  |   |              | 
|Finished products |  |  | $ | 259,412  |  | $ | 252,582      | 
|Work-in-process   |  |  |   | 56,951   |  |   | 52,513       | 
|Raw materials     |  |  |   | 114,014  |  |   | 109,589      | 
|                  |  |  | $ | 430,377  |  | $ | 414,684      | 
|                  |  | 

|(2) |  | Weighted
average shares used in the computation of basic and diluted net           earnings per
common share are as follows:
|--- |  | ----------------------------------------------------------------------------------------------------------------------------

| |  |  |                    |  |                 
| |  |  | ------------------ |  | ----------------
| |  |  | Three Months Ended |  | Six Months Ended

|                               |  |  |  | June 30, 2004 |  |  | June 30, 2003 |  |  | June 30, 2004 |  |  | June 30, 2003 | 
|------------------------------ |  |  |  | ------------- |  |  | ------------- |  |  | ------------- |  |  | ------------- | 
|Weighted average shares used   |  | 
|for basic net earnings per     |  | 
|common share                   |  |  |  | 55,301,296    |  |  | 55,697,528    |  |  | 55,752,228    |  |  | 55,675,831    | 
|Effect of dilutive securities: |  | 
|Stock options                  |  |  |  | 620,100       |  |  | 518,562       |  |  | 749,009       |  |  | 432,250       | 
|Weighted average shares used   |  | 
|for diluted net earnings       |  | 
|per common share               |  |  |  | 55,921,396    |  |  | 56,216,090    |  |  | 56,501,237    |  |  | 56,108,081    | 
|                               |  | 

|(3) |  | Other
comprehensive income is as follows:
|--- |  | -----------------------------------------

|                                |  |  |   |            |   |   |            | 
|------------------------------- |  |  | - | ---------- | - | - | ---------- | 
|                                |  |  |   | Six Months |   |   | Six Months | 
|                                |  |  |   | Ended      |   |   | Ended      | 
|                                |  |  |   | June 30,   |   |   | June 30,   | 
|                                |  |  |   | 2004       |   |   | 2003       | 
|                                |  |  |   |            |   |   |            | 
|Net earnings                    |  |  | $ | 49,811     |   | $ | 52,616     | 
|Other comprehensive income, net |  | 
|of tax:                         |  | 
|Financial instruments accounted |  | 
|for as hedges                   |  |  |   | 7,725      |   |   | 2,573      | 
|Foreign currency translation    |  |  |   | (369       | ) |   | 227        | 
|Other comprehensive income      |  |  |   | 7,356      |   |   | 2,800      | 
|                                |  |  | $ | 57,167     |   | $ | 55,416     | 
|                                |  | 

The
components of accumulated other comprehensive income, each presented net of tax benefit,
are as follows:

|                             |  |  |   |          |   |   |              |  
|---------------------------- |  |  | - | -------- | - | - | ------------ | -
|                             |  |  |   | June 30, |   |   | December 31, |  
|                             |  |  |   | 2004     |   |   | 2003         |  
|                             |  |  |   |          |   |   |              |  
|Market value of financial    |  | 
|instruments accounted        |  | 
|for as hedges                |  |  | $ | 5,087    |   | $ | (2,638       | )
|Minimum pension liability    |  |  |   | (28,170  | ) |   | (28,170      | )
|Foreign currency translation |  |  |   | (1,007   | ) |   | (638         | )
|                             |  |  | $ | (24,090  | ) |   | (31,446      | )

---

|(4) |  | The
Company  accounts for  stock-based  employee  compensation  using the  intrinsic  value
method as prescribed by Accounting         Principles  Board  Opinion  No. 25.  Had
 compensation  cost for the  Company's  stock-based  compensation  plan been  determined
        consistent with SFAS No. 123, net earnings and net earnings per common share
would have been as follows:
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |  |          |  |  |          |  | 
| |  |  | -------- |  |  | -------- |  | 
| |  |  | June 30, |  |  | June 30, |  | 

|                             |  |  |   | 2004   |   |   | 2003   |   |   | 2004   |   |   | 2003   |  
|---------------------------- |  |  | - | ------ | - | - | ------ | - | - | ------ | - | - | ------ | -
|                             |  | 
|Net earnings - as reported   |  |  | $ | 16,602 |   | $ | 23,575 |   | $ | 49,811 |   | $ | 52,616 |  
|                             |  | 
|Deduct: Stock-based employee |  | 
|compensation expense         |  | 
|determined under fair value  |  | 
|based method, net of         |  | 
|tax benefit                  |  |  |   | (1,220 | ) |   | (1,405 | ) |   | (2,440 | ) |   | (2,776 | )
|                             |  | 
|Net earnings - pro forma     |  |  | $ | 15,382 |   | $ | 22,170 |   | $ | 47,371 |   | $ | 49,840 |  
|                             |  | 
|Earnings per share-basic:    |  | 
|As reported                  |  |  | $ | 0.30   |   | $ | 0.42   |   | $ | 0.89   |   | $ | 0.95   |  
|Pro forma                    |  |  | $ | 0.28   |   | $ | 0.40   |   | $ | 0.85   |   | $ | 0.90   |  
|                             |  | 
|Earnings per share-diluted:  |  | 
|As reported                  |  |  | $ | 0.30   |   | $ | 0.42   |   | $ | 0.88   |   | $ | 0.94   |  
|Pro forma                    |  |  | $ | 0.28   |   | $ | 0.40   |   | $ | 0.84   |   | $ | 0.90   |  
|                             |  | 

|(5) |  | The
components of net periodic pension cost for Company-sponsored defined           benefit
plans are as follows:
|--- |  | -----------------------------------------------------------------------------------------------------------------

|                               |  |  |   |            |   |   |            |  
|------------------------------ |  |  | - | ---------- | - | - | ---------- | -
|                               |  |  |   | Six Months |   |   | Six Months |  
|                               |  |  |   | Ended      |   |   | Ended      |  
|                               |  |  |   | June 30,   |   |   | June 30,   |  
|                               |  |  |   | 2004       |   |   | 2003       |  
|                               |  |  |   |            |   |   |            |  
|Service cost                   |  |  | $ | 6,726      |   | $ | 5,761      |  
|Interest cost                  |  |  |   | 12,306     |   |   | 11,898     |  
|Expected return on plan assets |  |  |   | (14,174    | ) |   | (14,363    | )
|Net amortization and deferral  |  |  |   | 1,908      |   |   | 2,833      |  
|                               |  |  | $ | 6,766      |   | $ | 6,129      |  

| | In the
first  quarter of 2004,  the Company made a cash  contribution  of $15,000 to the defined
 benefit  plan's trust fund. No         additional contributions to the trust fund are
anticipated for 2004.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(6) |  | The
Company has provided  guarantees related to store leases for certain independent  dealers
opening  Company-branded  stores         (e.g.,  Thomasville Home Furnishings  Stores).
The guarantees range from one to fifteen years and generally require the Company
        to make lease payments in the event of default by the dealer.  In the event of
default,  the Company has the right to assign or         assume the lease.  The total
future lease payments  guaranteed at June 30, 2004 were $93,123.  The Company believes
the risk of         significant loss from these lease guarantees is remote.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

Item 2.
 Management's Discussion and Analysis of Results of Operations and
              Financial Condition

RESULTS OF OPERATIONS

Furniture Brands  International,
 Inc.  (referred to herein as the "Company") is one of the largest home  (residential)
 furniture      manufacturers in the United States.  The Company has four primary
operating  subsidiaries:  Broyhill Furniture  Industries,  Inc.;      Lane Furniture
Industries,  Inc.; Thomasville Furniture Industries,  Inc., and HDM Furniture Industries,
 Inc. (which includes the      operations of Henredon, Drexel Heritage and
Maitland-Smith).

Comparison of Three Months and Six
Months Ended June 30, 2004 and 2003

Selected financial information for
the three months and six months ended June 30, 2004 and June 30, 2003 is presented below:

(Dollars in millions except per
share data)

| |  |  |  | Three Months Ended | 
| |  |  |  | ------------------ | 

| |  |  | June 30, 2004 |  |  |  | June 30, 2003 | 
| |  |  | ------------- |  |  |  | ------------- | 

|                                      |  |   |         |  |  | % of      |  |  |   |         |  |  | % of      | 
|------------------------------------- |  | - | ------- |  |  | --------- |  |  | - | ------- |  |  | --------- | 
|                                      |  |   | Dollars |  |  | Net Sales |  |  |   | Dollars |  |  | Net Sales | 
|Net sales                             |  | $ | 575.7   |  |  | 100.0%    |  |  | $ | 579.6   |  |  | 100.0%    | 
|Earnings from operations              |  |   | 29.3    |  |  | 5.1%      |  |  |   | 41.0    |  |  | 7.1%      | 
|Interest expense                      |  |   | 4.0     |  |  | 0.7%      |  |  |   | 4.8     |  |  | 0.8%      | 
|Income tax expense                    |  |   | 9.2     |  |  | 1.6%      |  |  |   | 13.6    |  |  | 2.3%      | 
|Net earnings                          |  |   | 16.6    |  |  | 2.9%      |  |  |   | 23.6    |  |  | 4.1%      | 
|Net earnings per common share-diluted |  |   | 0.30    |  |  | --        |  |  |   | 0.42    |  |  | --        | 
|                                      |  |   |         |  |  |           |  |  |   |         |  |  |           | 
|Gross profit (1)                      |  | $ | 152.0   |  |  | 26.4%     |  |  | $ | 148.8   |  |  | 25.7%     | 

| |  |  |  | Six Months Ended | 
| |  |  |  | ---------------- | 

| |  |  | June 30, 2004 |  |  |  | June 30, 2003 | 
| |  |  | ------------- |  |  |  | ------------- | 

|                                      |  |   |         |  |  | % of      |  |  |   |         |  |  | % of      | 
|------------------------------------- |  | - | ------- |  |  | --------- |  |  | - | ------- |  |  | --------- | 
|                                      |  |   | Dollars |  |  | Net Sales |  |  |   | Dollars |  |  | Net Sales | 
|Net sales                             |  | $ | 1,234.2 |  |  | 100.0%    |  |  | $ | 1,193.4 |  |  | 100.0%    | 
|Earnings from operations              |  |   | 85.5    |  |  | 6.9%      |  |  |   | 91.3    |  |  | 7.6%      | 
|Interest expense                      |  |   | 8.9     |  |  | 0.7%      |  |  |   | 9.9     |  |  | 0.8%      | 
|Income tax expense                    |  |   | 28.0    |  |  | 2.3%      |  |  |   | 30.5    |  |  | 2.6%      | 
|Net earnings                          |  |   | 49.8    |  |  | 4.0%      |  |  |   | 52.6    |  |  | 4.4%      | 
|Net earnings per common share-diluted |  |   | 0.88    |  |  | --        |  |  |   | 0.94    |  |  | --        | 
|                                      |  |   |         |  |  |           |  |  |   |         |  |  |           | 
|Gross profit (1)                      |  | $ | 329.8   |  |  | 26.7%     |  |  | $ | 315.4   |  |  | 26.4%     | 

|(1) |  | The
Company believes that gross profit provides useful information regarding a
          companys financial performance. Gross profit has been calculated by
          subtracting cost of operations and the portion of depreciation associated with
          cost of goods sold from net sales.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |  |  |                    |  |  |                  | 
| |  |  |  | ------------------ |  |  | ---------------- | 
| |  |  |  | Three Months Ended |  |  | Six Months Ended | 
| |  |  |  | June 30,           |  |  | June 30,         | 

|                              |  |  |   | 2004  |  |   | 2003  |  |   | 2004    |  |   | 2003    | 
|----------------------------- |  |  | - | ----- |  | - | ----- |  | - | ------- |  | - | ------- | 
|Net sales                     |  |  | $ | 575.7 |  | $ | 579.6 |  | $ | 1,234.2 |  | $ | 1,193.4 | 
|Cost of operations            |  |  |   | 413.7 |  |   | 420.5 |  |   | 884.6   |  |   | 857.0   | 
|Depreciation (associated with |  | 
|cost of goods sold)           |  |  |   | 10.0  |  |   | 10.3  |  |   | 19.8    |  |   | 21.0    | 
|Gross profit                  |  |  | $ | 152.0 |  | $ | 148.8 |  | $ | 329.8   |  | $ | 315.4   | 
|                              |  | 

Net sales for the three months ended
June 30, 2004 were $575.7 million, compared to $579.6 million in the three months ended
June 30, 2003, a decrease of $3.9 million or 0.7%. For the six months ended June 30,
2004, net sales increased $40.8 million or 3.4%, to $1,234.2 million from $1,193.4
million for the six months ended June 30, 2003. Beginning in late-April of the second
quarter ended June 30, 2004, the same soft

---

business environment that has characterized
the residential furniture industry since mid-2000 began to return. Business remained
comparatively strong at the upper-end companies (Thomasville, Henredon, Drexel Heritage),
but continuing weakness in the middle-price companies (Broyhill, Lane) brought overall
sales down to nearly flat for the three months ended June 30, 2004 as compared to the
prior year period.

Earnings from operations for the
three months ended June 30, 2004 and June 30, 2003 were $29.3 million and $41.0 million,
respectively. As a percentage of net sales, earnings from operations for the three months
ended June 30, 2004 and June 30, 2003 were 5.1% and 7.1%, respectively. For the six
months ended June 30, 2004 and June 30, 2003, earnings from operations were $85.5 million
and $91.3 million, respectively. Earnings from operations for the six months ended June
30, 2004 and June 30, 2003 were 6.9% and 7.6% of net sales, respectively. Earnings from
operations in the three months and six months ended June 30, 2004 were negatively
impacted by $3.7 million and $5.3 million, respectively, in restructuring and asset
impairment charges attributable to the Drexel Heritage plant closings announced in
January 2004 as well as a charge of $8.3 million to reflect the loss of collectibility of
the receivable due from Breuners Home Furnishings Corporation, a large customer of
Broyhill and Lane, which filed for bankruptcy protection shortly after the second quarter
ended.  Restructuring charges of $2.6 million were also included in earnings from operations
for the three months and six months ended June 30, 2003.

Interest expense totaled $4.0
million and $8.9 million for the three months and six months ended June 30, 2004,
respectively, compared to $4.8 million and $9.9 million for the prior year comparable
periods. The decrease in interest expense for the three months ended June 30, 2004
resulted from both lower long-term debt levels and lower interest rates. The decrease in
interest expense for the six months ended June 30, 2004 resulted from lower long-term
debt levels. The reduction in both periods interest expense was partially offset by
the amortization of deferred financing fees related to the Companys refinancing of
its revolving credit facility in December 2003.

The effective income tax rates were
35.6% and 36.5% for the three months ended June 30, 2004 and June 30, 2003, respectively,
and 36.0% and 36.7% for the six months ended June 30, 2004 and June 30, 2003,
respectively. The effective income tax rates for the three months and six months ended
June 30, 2004 were favorably impacted by lower provisions for state and local income
taxes compared to the prior year periods as well as by certain federal income tax credits
available to the Company.

Net earnings per common share for
basic and diluted were $0.30 and $0.30 for the three months ended June 30, 2004,
respectively, compared with $0.42 and $0.42 for the same period last year, respectively.
For the six months ended June 30, 2004 and June 30, 2003, net earnings per common share
for basic and diluted were $0.89 and $0.88, respectively, and $0.95 and $0.94,
respectively. Average common and common equivalent shares outstanding used in the
calculation of net earnings per common share on a basic and diluted basis were 55,301,000
and 55,921,000, respectively, for the three months ended June 30, 2004, and 55,698,000
and 56,216,000, respectively, for the three months ended June 30, 2003. For the six
months ended June 30, 2004 and June 30, 2003, average common and common equivalent shares
outstanding used in the calculation of net earnings per common share on a basic and
diluted basis were

---

55,752,000 and 56,501,000, respectively, and 55,676,000 and 56,108,000,
respectively. The lower average common and common equivalent shares
outstanding in 2004 versus 2003 results primarily from share repurchases made by the
Company during the six months ended June 30, 2004.

FINANCIAL CONDITION

Working Capital

Cash and cash equivalents at June
30, 2004 amounted to $56.6 million, compared with $71.7 million at December 31, 2003.
During the six months ended June 30, 2004, net cash provided by operating activities
totaled $48.2 million, net cash used by investing activities totaled $9.7 million and net
cash used by financing activities totaled $53.6 million.

Working capital was $710.9 million
at June 30, 2004, compared with $703.2 million at December 31, 2003. The current ratio
was 4.8-to-1 at June 30, 2004 and December 31, 2003.

Financing Arrangements

As of June 30, 2004, long-term debt
consisted of the following in millions:

| |  |  | Revolving credit facility (unsecured) |  |  | $ | 300.0 | 
| |  |  | ------------------------------------- |  |  | - | ----- | 
| |  |  | Other                                 |  |  |   | 2.4   | 
| |  |  |                                       |  |  | $ | 302.4 | 

To meet short-term capital and other
financial requirements, the Company maintains a $550.0 million revolving credit facility
with a group of financial institutions. The revolving credit facility allows for the
issuance of letters of credit and cash borrowings. Letter of credit outstandings are
limited to no more than $150.0 million, with cash borrowings limited only by the facilitys
maximum availability less letters of credit outstanding. On June 30, 2004, there were
$300.0 million in cash borrowings and $22.3 million in letters of credit outstanding.

The facility requires the Company to
meet certain financial covenants including a minimum consolidated net worth and maximum
leverage ratio. As of June 30, 2004, the Company was in compliance with all financial
covenants.

Cash borrowings under the revolving
credit facility bear interest at a base rate or at an adjusted Eurodollar rate plus an
applicable margin which varies, depending upon the type of loan the Company executes. The
applicable margin over the base rate and Eurodollar rate is subject to adjustment based
upon achieving certain credit ratings. At June 30, 2004, loans outstanding under the
revolving credit facility consisted of $300.0 million based on the adjusted Eurodollar
rate, which in conjunction with the interest rate swaps (used to hedge $300.0 million of
the floating rate debt), have a weighted average interest rate of 4.24%.

The Company believes that cash
generated from operations, together with its revolving credit facility, will be adequate
to meet liquidity requirements for the foreseeable future.

Recently Issued
Statements of Financial Accounting Standards

In December 2003, the Financial
Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards
(SFAS) No. 132, Employers Disclosure about Pension and Other Postretirement

---

Benefits (an amendment of SFAS Nos. 87, 88 and 106). This statement revises employers disclosures
about pension plans and other postretirement benefit plans. The statement is effective
for financial statements with fiscal years ending after December 15, 2003; therefore, the
required disclosures are included in the Notes to Consolidated Financial Statements.

Subsequent Events

On July 14, 2004, the Company
announced that the Breuners Home Furnishings Corporation bankruptcy filing would result
in a charge to earnings of $0.09 to $0.10 per diluted common share in the second quarter
of 2004. The Company reported that it expected its Broyhill and Lane operations to be
listed as creditors in the Breuners bankruptcy action with a combined accounts receivable
of approximately $10 million. Consistent with this announcement, in the second quarter of
2004, the Company recorded a charge of $8.3 million or $0.09 per diluted common share to
reflect the loss of collectibility. The Companys sales to Breuners in full-year
2003 were approximately $42 million, representing less than 2% of the Companys
total sales.

OUTLOOK

Although orders in the first quarter
of 2004 were up 8.4% over the first quarter of 2003, orders in the second quarter of 2004
were off 2.7% against the prior year. In addition, while Broyhill and Lane are moving
forward to replace the Breuners volume, which was approximately $42 million in 2003, the
Company has reduced its sales expectations for the third and fourth quarters to reflect
the loss of some of this business.

The Company is currently projecting
sales to be flat in the third quarter and diluted earnings per common share in the $0.34
to $0.38 range. The Company will provide earnings guidance on a quarter-by-quarter basis
until better visibility is achieved with respect to the full year 2004.

FORWARD-LOOKING
STATEMENTS

The Company herein has made
forward-looking statements within the meaning of the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995. These forward-looking statements
include the Companys expected sales, earnings per share, profit margins, and cash
flows, the effects of certain manufacturing realignments and other business strategies,
the prospects for the overall business environment and other statements containing the
words expects, anticipates,estimates, believes, and
words of similar import. The Company cautions investors that any such forward-looking
statements are not guarantees of future performance and that certain factors may cause
actual results to differ materially from those in the forward-looking statements. Such
factors include, but are not limited to: changes in economic conditions; loss of market
share due to competition; failure to anticipate or respond to changes in consumer taste
and fashion trends; failure to achieve projected sales; business failures of large
customers; distribution and manufacturing realignments and cost savings programs;
increased reliance on offshore (import) sourcing of various products; fluctuations in the
cost, availability and quality of raw materials; product liability uncertainty; and
impairment of goodwill and other intangible assets. Other risk factors may be listed from
time to time in the

---

Companys future public releases and SEC reports. Please refer
to the Companys Annual Report on Form 10-K for a more detailed explanation of the
Companys risk factors.

Item 3. Quantitative and
Qualitative Disclosures about Market Risk

The Company is exposed to market
risk from changes in interest rates. The Companys exposure to interest rate risk
consists of its floating rate revolving credit facility. This risk is managed using
interest rate swaps to fix a portion of the Companys floating rate long-term debt.
Currently, interest rate swaps fix the entire outstanding balance on the revolving credit
facility; therefore, an increase in interest rates would have no impact on the Companys
net earnings.

Item 4. Controls and Procedures

|(a) |  | The
Companys chief executive officer and chief financial officer have
               concluded that the Companys disclosure controls and procedures are
               effective based on their evaluation of these controls and procedures as of
the                end of the period covered by this report.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) |  | No
change in the Companys internal control over financial reporting has
               occurred during the Companys most recent fiscal quarter that has
               materially affected, or is reasonably likely to materially affect, the
               Companys internal control over financial reporting.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

PART II OTHER
INFORMATION

Item 2. Changes in Securities, Use
of Proceeds and Issuer Purchases

# ISSUER PURCHASES OF
EQUITY SECURITIES

|         |  |  |  |           |  |   |            |  |  |                      |  |   |                     | 
|-------- |  |  |  | --------- |  | - | ---------- |  |  | -------------------- |  | - | ------------------- | 
|         |  |  |  |           |  |   |            |  |  | Total                |  |   | Approximate Dollar  | 
|         |  |  |  | Total     |  |   |            |  |  | Number of Shares     |  |   | Value of Shares     | 
|         |  |  |  | Number of |  |   | Average    |  |  | Purchased as Part of |  |   | that May Yet Be     | 
|         |  |  |  | Shares    |  |   | Price Paid |  |  | Publicly Announced   |  |   | Purchased Under the | 
|Period   |  |  |  | Purchased |  |   | per Share  |  |  | Plans or Programs    |  |   | Plans or Programs   | 
|         |  | 
|April 1- |  | 
|April 30 |  |  |  | -         |  |   | -          |  |  | -                    |  | $ | 86,710,781          | 
|         |  | 
|May 1-   |  | 
|May 31   |  |  |  | 1,371,400 |  | $ | 27.13      |  |  | 1,371,400            |  | $ | 49,501,565          | 
|         |  | 
|June 1-  |  | 
|June 30  |  |  |  | -         |  |   | -          |  |  | -                    |  | $ | 49,501,565         
|Total    |  |  |  | 1,371,400 |  | $ | 27.13      |  |  | 1,371,400            |  |   |                     | 
|         |  | 

On
October 24, 2002, the Company announced the authorization of a program to repurchase $100
million of its Common Stock over a period of 24 months. The authorization will expire on
October 24, 2004.

On
August 2, 2004, the Company announced that its Board of Directors authorized the
repurchase of an additional $50 million of its Common Stock over a period of 12 months.
This new authority is in addition to the existing authority to repurchase $100 million of
its Common Stock.

Item 4.    Submission of
Matters to a Vote of Security Holders

| |  | The Annual
Meeting of Stockholders was held on April 29, 2004. The directors listed in the Notice of
Annual Meeting of Stockholders dated March 25, 2004 were elected for terms of one year
ending 2005 with voting for each as follows:
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |                   |  |            |  |           | 
| |  | ----------------- |  | ---------- |  | --------- | 
| |  | Director          |  | For        |  | Withheld  | 
| |  | K. B. Bell        |  | 49,722,015 |  | 1,692,857 | 
| |  | J. T. Foy         |  | 50,252,237 |  | 1,162,635 | 
| |  | W. G. Holliman    |  | 50,281,133 |  | 1,133,739 | 
| |  | J. R. Jordan, Jr. |  | 49,901,730 |  | 1,513,142 | 
| |  | D. E. Lasater     |  | 50,144,811 |  | 1,270,061 | 
| |  | L. M. Liberman    |  | 49,055,943 |  | 2,358,929 | 
| |  | R. B. Loynd       |  | 49,935,355 |  | 1,479,517 | 
| |  | B. L. Martin      |  | 49,288,880 |  | 2,125,992 | 
| |  | A. B. Patterson   |  | 50,433,630 |  | 981,242   | 
| |  | A. E. Suter       |  | 50,462,310 |  | 952,562   | 

---

Item 6.             Exhibits and
Reports on Form 8-K

|(a) | 31 | Certifications of W. G. Holliman, Chief
Executive Officer of the Company and          David P.Howard, Chief Financial Officer of
the Company, Pursuant to Rule  13a-14(a)/15d-14(a),as Adopted Pursuant         to Section
302 of the Sarbanes-Oxley Act of 2002.
|--- | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|32 |  | Certifications
 of W. G.  Holliman,  Chief  Executive  Officer of the Company and David P.  Howard,
                                    Chief Financial Officer of the Company,  Pursuant to
18 U.S.C. Section 1350, as Adopted Pursuant to
                                    Section 906 of the Sarbanes-Oxley Act of 2002.
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) |  | A
Form 8-K was filed on May 3, 2004  announcing  first quarter  operating  results and
projections of second                            quarter  earnings per share. A Form 8-K
was filed on June 4, 2004  announcing  projections of second quarter
                           earnings per share.  A Form 8-K was filed on July 14, 2004
 announcing a charge to earnings as the result of                            the Breuners
 bankruptcy.  A Form 8-K was filed on August 2, 2004  announcing  second quarter and
first half                            of 2004 operating  results and projections  for
third quarter  earnings per share and the  authorization  of
                           additional common stock repurchases.
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

SIGNATURE

Pursuant to the  requirements  of
the Securities  Exchange Act of 1934, the registrant has duly caused this report to be
signed         on its behalf by the undersigned thereunto duly authorized.

| |  |                                      | 
| |  | ------------------------------------ | 
| |  | Furniture Brands International, Inc. | 
| |  | (Registrant)                         | 

| |    |                          | 
| | -- | ------------------------ | 
| | By | /s/ Steven W. Alstadt    | 
| |    | Steven W. Alstadt        | 
| |    | Controller and           | 
| |    | Chief Accounting Officer | 

Date:  August 9, 2004