Hooker Furnishings Corporation (NASDAQ-GS: HOFT), a global leader
in the design, production and marketing of home furnishings for
nearly a century, today reported results for its fiscal-year 2023
fourth quarter and full year ended January 29, 2023.
Fiscal 2023 and fiscal 2023 fourth quarter
overview:
- Consolidated net sales for
fiscal 2023 were $583.1 million, a decrease of $10.5 million, or
1.8%, compared to the prior year, driven by a $62.6 million or
22.4% net sales decline in the Home Meridian segment, while
partially offset by a $49.9 million or 46.7% higher net sales in
the Domestic Upholstery segment, marking the second consecutive
year of double-digit sales gains at Bradington-Young, HF Custom
(formerly Sam Moore Furniture) and Shenandoah. The addition of
Sunset West results for the full year also significantly
contributed to the annual sales growth in this segment. Hooker
Branded net sales were essentially flat compared to the record
sales achieved in fiscal 2022 in the segment.
- The Company recorded a
$24.4 million non-cash charge related to its exit of the Accentrics
Home (ACH) line of lower-priced, low-margin accent items, for the
write down of ACH inventories and other excess inventories in the
Home Meridian segment. The charge was initially expected to be $34
million, but estimates were refined during the Company’s year-end
financial close and was ultimately less than originally estimated
in part as sales of the inventory have thus far been at less of a
discount than originally expected. The charge drove the decreased
consolidated gross profit and margin. To a lesser extent, higher
warehousing and distribution costs in the Hooker Branded segment
and lower overall sales volume contributed to the reduced gross
profit. In the Domestic Upholstery segment, gross profit and margin
improved due to higher year-over-year sales.
- As a result of the $24.4
million inventory valuation charge, the Company reported a
consolidated operating loss of $6.0 million and a consolidated net
loss of $4.3 million or ($0.37) per diluted share for fiscal year
2023, compared to consolidated operating income of $14.8 million
and consolidated net income of $11.7 million in the prior
year.
- For the fiscal 2023 fourth
quarter, consolidated net sales decreased by $3.5 million, or 2.6%,
versus the prior year period due to a $16.3 million reduction in
net sales in the Home Meridian segment. The decrease was partially
offset by $6.5 million and $5.3 million net sales increases versus
the prior year period in the Hooker Branded and Domestic Upholstery
segments, respectively.
- The Company reported a
fourth-quarter operating loss of $23.7 million and net loss of
$17.9 million or ($1.60) per diluted share, driven by the $24.4
million inventory valuation charge recorded in the fourth quarter
of fiscal 2023.
Management Commentary
“During a year challenged by economic and global
supply-chain headwinds, we’re pleased to have achieved double-digit
sales gains in Domestic Upholstery for the second consecutive year,
and to have a strong finish at Hooker Branded with a $6.5 million
sales increase in the fourth quarter,” said Jeremy Hoff, chief
executive officer and director of Hooker Furnishings.
“Adding to the positive momentum, our contract
and hospitality furnishings businesses, H Contract and SLH,
continued to recover from the pandemic’s negative impact on these
categories in the past two years,” he said.
“While painful in the short term, we made the
decision to exit the unprofitable ACH business rather than dragging
out corrective actions for years. It is an intentional effort to
resolve this more quickly and get HMI on the path to profitability
sooner,” said Hoff. “As we reported last month, this action is part
of our final phase of reorganization at HMI, and because of this,
we’re confident we can turn HMI to profitability by the end of this
year. Also, as part of reorganizing the HMI segment, we are
repositioning the Prime Resources International (PRI) business unit
as a direct container-only business model. Changing the PRI model
minimizes both cash and inventory risk and eliminates unnecessary
margin erosion from costs related to maintaining domestic
inventory,” he added.
“Hooker Furnishings enters the year
well-positioned to navigate a new landscape that’s shifting from
historically high demand to a reliance on market share gains,” Hoff
said. “We have multiple initiatives underway to broaden our share
of the total addressable market, brand positioning and visibility.
At the Spring High Point Market next week, we’ll debut our nearly
120,000-square-foot Hooker Legacy Showroom in a prime location at
the center of the market and encompassing the entire third floor of
the Showplace Building. Featuring abundant natural lighting, high
ceilings, a modern presentation and an outdoor patio, the showroom
will help us attract new customers, become a more important brand
offering to all sales segments, and accelerate our multiple
strategic growth initiatives through this engaging shopping
experience.”
“Also at the High Point Market, we are launching
“M”, a domestically produced upholstery and imported occasional
furniture brand. The M brand, produced by HF Custom,
Bradington-Young and Shenandoah, represents a significant
opportunity by allowing us to address a casual, comfortable, modern
lifestyle – a look distinct from anything we currently offer.
Additionally, we are showing the first comprehensive display of the
Sunset West outdoor furniture product line in the Southeast U.S.
The prominent and comprehensive display of the Sunset West line in
High Point, along with positioning the line to have a Savannah
Warehouse shipping point, will help accelerate our distribution
expansion of the California-based product line throughout the U.S.,
as the outdoor furniture market continues to have exciting growth
potential.” Hoff said.
Segment Reporting: Hooker
Branded
For the fiscal year, the Hooker Branded
segment’s net sales decreased slightly by $1.1 million, or 0.5%,
compared to the peak sales in the prior year after the initial
COVID crisis. This segment experienced abnormally low inventory
levels in the first quarter of fiscal 2023, due to the
COVID-related temporary factory closures in Vietnam in late
calendar 2021. In the third quarter, there was a temporary delay in
shipments due to inventory mix issues. Those issues were resolved,
as inventory increased in the segment by $35 million compared to
the prior year end and more than doubled compared to fiscal 2020-
and 2021-year ends.
Gross profit and margin decreased compared to
the prior year due to higher demurrage expenses and increased
warehousing labor costs, driven by the large inventory volume as
well as port and warehouse congestion in the U.S. Although there
were fewer incoming orders compared to the demand surge in the
prior year, a significant portion of the large backlog from the
previous year was fulfilled, leading to solid shipments during the
current year. Order backlog for the segment at year end remained
76% higher than pre-pandemic levels at fiscal 2020-year end.
“After getting our inventory mix into balance,
we were able to ship our strong backlogs and achieve a 15% fourth
quarter sales increase at Hooker Branded to finish the year,” said
Hoff. “Going forward, we’re in a strong position to ship our
backlogs and service higher demand that we expect from our
aggressive growth plans. In addition, the very well-received and
equally well-placed whole-home Charleston Collection introduced
last fall is beginning to ship to retail floors.”
Segment Reporting: Home Meridian
(HMI)
Net sales at HMI decreased by $62.6 million, or
22.4%, compared to the prior year. Additionally, this segment
recorded an operating loss of $37.2 million, driven by lower sales
volume and the $24.4 million inventory valuation charges related to
the exit of the ACH business unit, the repositioning of the PRI
business, and on excess SLF inventories.
- The ACH unit, focused on
lower-priced items, contributed about 13% of HMI’s overall revenue,
but accounted for over 50% of the operating loss in this segment,
primarily due to the write-down of its inventories to market. The
unit’s business model required significant investment in inventory
and high handling costs to meet quick shipping demands.
Additionally, these lower-priced and lower-margin ACH inventories
carried historically high freight costs from the prior year. Given
the inventory levels, industry discounting and current low demand,
the Company determined a profitable market for these products
didn’t exist and was unwilling to continue to incur additional
lease, warehouse, labor and other costs to store and sell aging
inventory below cost well into the future. Consequently, it decided
the best course of action was to exit the brand.
- Over 30% of the net sales decrease
was driven by HMidea, which was exited in fiscal 2022 and focused
on Clubs channel sales. The Company made the decision to exit
HMidea in the prior fiscal year due to continued losses driven by
low margins and excessive chargebacks. While this led to a decrease
in revenue, the exit resulted in significant improvement in returns
and allowances costs.
- Nearly 60% of the decrease was
driven by sales decreases at PRI and SLF, which service major
furniture chains and mass merchants. These brands experienced
decreased incoming orders as retail customers focused on reducing
their own excess inventories by delaying shipments. Pulaski’s
fiscal 2023 net sales were essentially flat.
- On a more positive note, HMI’s
licensed collection, Drew + Jonathan Home, is selling well at
retail, with significant growth opportunity.
The Company is restructuring and repositioning
the Home Meridian business to prioritize the most profitable and
stable channels and product categories, with the goal of improving
profitability across the segment. “As part of this restructuring,
we plan to reduce the physical footprints at our Savannah, GA.
Warehouse and High Point, NC administrative office over the course
of our current fiscal year,” said Paul Huckfeldt, senior vice
president and chief financial officer. “This will reduce our lease,
warehousing, and related expenses. “By the end of fiscal 2024, we
expect to reduce our working capital requirement by about 60%,
which will greatly improve our cash flow return on investment while
lowering our overhead at HMI by over $12 million over a 2-year
period from the beginning of fiscal 2023,” Huckfeldt added.
“Going forward, HMI will focus working capital
toward the product lines that matter most to our partners,” said
Hoff. “That means we will focus entirely on the segment’s core
businesses: Pulaski Furniture, Samuel Lawrence Furniture, PRI and
Samuel Lawrence Hospitality. We believe we have a significant
opportunity to create a sustainable profit-model at HMI, without
the erratic ups and downs we have experienced over the recent
years. We believe HMI will achieve profitability in the second-half
of fiscal 2024.”
Segment Reporting: Domestic
Upholstery
The Domestic Upholstery Segment reported a $49.9
million, or 46.7%, sales increase compared to the prior year.
Double-digit annual sales gains at Bradington-Young, HF Custom and
Shenandoah for the second consecutive year helped drive the
year-over-year increase, along with the addition of Sunset West
results. Gross margin was 20.8%, compared to 19.5% in the prior
year. Higher sales volume and operating near full capacity
significantly improved overhead absorption and direct labor
efficiency; however, price inflation of raw materials and higher
freight surcharges negatively impacted profitability.
For the fiscal 2023 fourth quarter, net sales
increased by $5.3 million, or 18.6%, compared to the same period a
year ago. However, when the new ERP system went live at Sunset West
in December 2022, the conversion process significantly impacted its
shipping activities and negatively impacted its profitability in
the fiscal 2023 fourth quarter. These issues were mostly resolved
in the first quarter of fiscal 2024.
“While more than doubling its California
production and warehousing space and implementing a new ERP system
this year, Sunset West has exceeded our expectations from a growth
opportunity standpoint,” said Hoff. “We’re excited to participate
in the growing outdoor furniture space, and believe Sunset West is
in a strong position to gain significant market share.”
Incoming orders in the segment decreased due to
a slowdown in demand. Order backlog was lower than the prior year
when demand was exceptionally strong, but production capacity was
constrained. Shortages and inconsistent deliveries of certain raw
materials were no longer a concern during fiscal 2023, which
enabled the fulfillment of orders and a reduction in the
historically high order backlogs carried over from the prior year.
At the end of fiscal 2023, order backlog, excluding Sunset West,
remained 57% higher than pre-pandemic levels at fiscal 2020 year
end.
“Our delivery lead times for domestic upholstery
continue to come down and are approaching more normalized levels,”
Hoff said. “As fiscal 2024 progresses, we expect delivery times
will continue to improve.”
Cash, Debt and Inventory
Cash and cash equivalents stood at $19 million
at fiscal 2023 year-end, down $50.4 million from the balance at the
fiscal 2022 year-end. The Company used a portion of cash on hand
and cash collected from accounts receivable to fund $19 million
increase in inventory, $13.3 million in share repurchases, $9.6
million in cash dividends to our shareholders, $5.4 million for
development of our new cloud-based ERP system, and $4.2 million
capital expenditure for enhancements of other systems and
facilities. A total of 820,000 shares of common stock were
purchased and retired under the $20 million share repurchase
authorization approved by the Board of Directors in calendar 2022.
During fiscal 2023, the Company entered into a $25 million term
loan to replenish cash used to make the Sunset West acquisition.
Liquidity and capital requirements will be further improved through
the write down of ACH inventories and other excess inventories, as
discussed above.
“Since the 2023 fiscal year-end, cash and cash
equivalents have increased about $20 million despite an additional
$3 million in share repurchases. The cash increase is mostly
attributable to right-sizing our inventory levels,” Huckfeldt
continued.
Capital Allocation
“We are pleased to be bringing our inventory
levels in line with demand and generating cash, while also
purchasing shares and continuing to pay our dividend. The dividend,
which is now yielding over 4.5%, along with our share repurchase
program, are meaningful ways to return capital to our
shareholders,” said Huckfeldt. “We expect to continue to generate
cash in the coming year,” Huckfeldt continued, “which we will use
to fund capital expenditures, pay dividends, repay debt and
strengthen our cash position.”
Outlook
“Economic indicators remain mixed. We are
encouraged by the stabilization of global supply chain dynamics,
some moderation of inflation and continuing strength in employment
levels, but concerned about possible instability in global banking,
interest rates and the stock market. Other headwinds include
retailers delaying shipments due to temporarily high inventory
levels, and the regulatory uncertainty with respect to anti-tipping
standards on bedroom storage furniture, which we believe negatively
impacted incoming order rates in the fiscal 2024 first quarter,
especially from larger customers of our Home Meridian segment.
Based on recent developments, it appears the tip-over issue is near
resolution and we do not expect it to have a long-term impact on
demand or product costs,” said Hoff.
“As the industry returns to more typical demand
and supply chain constraints continue to improve, previously
astronomical ocean freight rates have declined, and appear to have
stabilized. We expect to begin realizing cost savings and improved
margins as the year progresses as we sell though our existing,
higher-cost inventory and replenish with goods carrying lower
freight charges.
“There is significant momentum at Home Meridian
with meaningful new placements with major customers. We expect the
product commitments made by customers will positively affect the
current fiscal year, helping put HMI on the path for solid and
sustainable profitability. With the opening of our new Hooker
Legacy Showroom and our first Spring High Point Market in the
renovated HMI and Portfolio showrooms, we expect an exciting,
well-attended furniture market next week. We believe our new High
Point and Las Vegas showrooms and plans to show at the Atlanta
Market this summer present an opportunity for us to get our brands
in front of more customers and prospects in the next 12 months than
at any time in our history,” he concluded.
Conference Call Details
Hooker Furnishings will present its fiscal 2023
fourth quarter and full year financial results via teleconference
and live internet webcast on Wednesday morning, April 19th, 2023 at
9:00 AM Eastern Time. A live webcast of the call will be available
on the Investor Relations page of the Company’s website at
https://investors.hookerfurnishings.com/events and archived for
replay. To access the call by phone, participants should go to this
link (registration link) and you will be provided with dial in
details. To avoid delays, participants are encouraged to dial into
the conference call fifteen minutes ahead of the scheduled start
time.
Hooker Furnishings Corporation, in its 99th year
of business, is a designer, marketer and importer of casegoods
(wooden and metal furniture), leather furniture, and
fabric-upholstered furniture for the residential, hospitality and
contract markets. The Company also domestically manufactures
premium residential custom leather and custom fabric-upholstered
furniture and outdoor furniture. Major casegoods product categories
include home entertainment, home office, accent, dining, and
bedroom furniture in the upper-medium price points sold under the
Hooker Furniture brand. Hooker’s residential upholstered seating
product lines include Bradington-Young, a specialist in upscale
motion and stationary leather furniture, HF Custom (formerly Sam
Moore Furniture), a specialist in fashion forward custom upholstery
offering a selection of chairs, sofas, sectionals, recliners and a
variety of accent upholstery pieces, Hooker Upholstery, imported
upholstered furniture targeted at the upper-medium price-range and
Shenandoah Furniture, an upscale upholstered furniture company
specializing in private label sectionals, modulars, sofas, chairs,
ottomans, benches, beds and dining chairs in the upper-medium price
points for lifestyle specialty retailers. The H Contract product
line supplies upholstered seating and casegoods to upscale senior
living facilities. The Home Meridian division addresses more
moderate price points and channels of distribution not currently
served by other Hooker Furnishings divisions or brands. Home
Meridian’s brands include Pulaski Furniture, casegoods covering the
complete design spectrum in a wide range of bedroom, dining room,
accent and display cabinets at medium price points, Pulaski
Upholstery, stationary and motion upholstery collections available
in fabric and leather covering the complete design spectrum at
medium price points, Samuel Lawrence Furniture, value-conscious
offerings in bedroom, dining room, home office and youth
furnishings, Prime Resources International, value-conscious
imported leather upholstered furniture, and Samuel Lawrence
Hospitality, a designer and supplier of hotel furnishings. The
Sunset West division is a designer and manufacturer of comfortable,
stylish and high-quality outdoor furniture. Hooker Furnishings
Corporation’s corporate offices and upholstery manufacturing
facilities are located in Virginia, North Carolina and California,
with showrooms in High Point, N.C., Las Vegas, N.V., Atlanta, G.A.
and Ho Chi Minh City, Vietnam. The company operates distribution
centers in Virginia, Georgia and Vietnam. Please visit our websites
hookerfurnishings.com, hookerfurniture.com, bradington-young.com,
sammoore.com, hcontractfurniture.com, homemeridian.com,
pulaskifurniture.com, slh-co.com, and sunsetwestusa.com.
Certain statements made in this release, other
than those based on historical facts, may be forward-looking
statements. Forward-looking statements reflect our reasonable
judgment with respect to future events and typically can be
identified by the use of forward-looking terminology such as
“believes,” “expects,” “projects,” “intends,” “plans,” “may,”
“will,” “should,” “would,” “could” or “anticipates,” or the
negative thereof, or other variations thereon, or comparable
terminology, or by discussions of strategy. Forward-looking
statements are subject to risks and uncertainties that could cause
actual results to differ materially from those in the
forward-looking statements. Those risks and uncertainties include
but are not limited to: (1) general economic or business
conditions, both domestically and internationally, including the
current macro-economic uncertainties and challenges to the retail
environment for home furnishings along with instability in the
financial and credit markets, in part due to rising interest rates,
including their potential impact on (i) our sales and operating
costs and access to financing or (ii) customers and suppliers and
their ability to obtain financing or generate the cash necessary to
conduct their respective businesses; (2) difficulties in
forecasting demand for our imported products and raw materials used
in our domestic operations; (3) risks associated with our reliance
on offshore sourcing and the cost of imported goods, including
fluctuation in the prices of purchased finished goods, customs
issues, freight costs, including the price and availability of
shipping containers, ocean vessels, ocean and domestic trucking,
and warehousing costs and the risk that a disruption in our
offshore suppliers or the transportation and handling industries,
including labor stoppages, strikes, or slowdowns, could adversely
affect our ability to timely fill customer orders; (4) risks
associated with HMI segment restructuring and cost-savings efforts,
including our ability to timely dispose of excess inventories,
reduce expenses and return the segment to profitability; (5) the
impairment of our long-lived assets, which can result in reduced
earnings and net worth; (6) adverse political acts or developments
in, or affecting, the international markets from which we import
products, including duties or tariffs imposed on those products by
foreign governments or the U.S. government and possible future U.S.
conflict with China; (7) the direct and indirect costs and time
spent by our associates associated with the implementation of our
Enterprise Resource Planning system, including costs resulting from
unanticipated disruptions to our business; (8) the interruption,
inadequacy, security breaches or integration failure of our
information systems or information technology infrastructure,
related service providers or the internet or other related issues
including unauthorized disclosures of confidential information,
hacking or other cyber-security threats or inadequate levels of
cyber-insurance or risks not covered by cyber- insurance; (9) risks
associated with our newly leased warehouse space in Georgia
including the inability to realize anticipated cost savings, access
to warehouse labor and information systems; (10) risks associated
with domestic manufacturing operations, including fluctuations in
capacity utilization and the prices and availability of key raw
materials, as well as changes in transportation, warehousing and
domestic labor costs, availability of skilled labor, and
environmental compliance and remediation costs; (11) the risks
related to the recent Sunset Acquisition including integration
costs, maintaining Sunset West’s existing customer relationships,
debt service costs, interest rate volatility, the use of operating
cash flows to service debt to the detriment of other corporate
initiatives or strategic opportunities, the loss of key employees
from Sunset West, the disruption of ongoing businesses or
inconsistencies in standards, controls, procedures and policies
across the business which could adversely affect our internal
control or information systems and the costs of bringing them into
compliance and failure to realize benefits anticipated from the
Sunset Acquisition; (12) changes in U.S. and foreign government
regulations and in the political, social and economic climates of
the countries from which we source our products; (13) risks
associated with product defects, including higher than expected
costs associated with product quality and safety, regulatory
compliance costs (such as the costs associated with the US Consumer
Product Safety Commission’s new mandatory furniture tip-over
standard) related to the sale of consumer products and costs
related to defective or non-compliant products, product liability
claims and costs to recall defective products and the adverse
effects of negative media coverage; (14) disruptions and damage
(including those due to weather) affecting our Virginia or Georgia
warehouses, our Virginia, North Carolina or California
administrative facilities, our High Point, Las Vegas, and Atlanta
showrooms or our representative offices or warehouses in Vietnam
and China; (15) the risks specifically related to the
concentrations of a material part of our sales and accounts
receivable in only a few customers, including the loss of several
large customers through business consolidations, failures or other
reasons, or the loss of significant sales programs with major
customers; (16) our inability to collect amounts owed to us or
significant delays in collecting such amounts; (17) achieving and
managing growth and change, and the risks associated with new
business lines, acquisitions, including the selection of suitable
acquisition targets, restructurings, strategic alliances and
international operations; (18) capital requirements and costs; (19)
risks associated with distribution through third-party retailers,
such as non-binding dealership arrangements; (20) the cost and
difficulty of marketing and selling our products in foreign
markets; (21) changes in domestic and international monetary
policies and fluctuations in foreign currency exchange rates
affecting the price of our imported products and raw materials;
(22) the cyclical nature of the furniture industry, which is
particularly sensitive to changes in consumer confidence, the
amount of consumers’ income available for discretionary purchases,
and the availability and terms of consumer credit; (23) price
competition in the furniture industry; (24) competition from
non-traditional outlets, such as internet and catalog retailers;
(25) changes in consumer preferences, including increased demand
for lower-priced furniture; and (26) other risks and uncertainties
described under Part I, Item 1A. "Risk Factors" in the Company’s
Annual Report on Form 10-K for the fiscal year ended January 29,
2023. Any forward-looking statement that we make speaks only as of
the date of that statement, and we undertake no obligation, except
as required by law, to update any forward-looking statements
whether as a result of new information, future events or otherwise
and you should not expect us to do so.
Table I |
HOOKER FURNISHINGS CORPORATION AND
SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF OPERATIONS |
(In thousands, except per share data) |
|
|
|
For the |
|
|
Thirteen Weeks Ended |
|
Fifty-Two Weeks Ended |
|
|
January 29, |
|
January 30, |
|
January 29, |
|
January 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
131,299 |
|
|
$ |
134,805 |
|
|
$ |
583,102 |
|
|
$ |
593,612 |
|
|
|
|
|
|
|
|
|
|
Cost of sales |
|
|
101,449 |
|
|
|
116,456 |
|
|
|
461,056 |
|
|
|
488,508 |
|
Inventory valuation expense |
|
|
29,078 |
|
|
|
1,953 |
|
|
|
28,752 |
|
|
|
3,402 |
|
|
|
|
|
|
|
|
|
|
Gross (loss)/profit |
|
|
772 |
|
- |
|
16,396 |
|
|
|
93,294 |
|
|
|
101,702 |
|
|
|
|
|
|
|
|
|
|
Selling and administrative expenses |
|
|
23,560 |
|
|
|
21,132 |
|
|
|
95,815 |
|
|
|
84,475 |
|
Intangible asset amortization |
|
|
878 |
|
|
|
596 |
|
|
|
3,512 |
|
|
|
2,384 |
|
Trade name impairment charges |
|
|
13 |
|
|
|
- |
|
|
|
13 |
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
Operating (loss)/income |
|
|
(23,679 |
) |
- |
|
(5,332 |
) |
|
|
(6,046 |
) |
|
|
14,843 |
|
|
|
|
|
|
|
|
|
|
Other income/(expense), net |
|
|
(10 |
) |
|
|
213 |
|
|
|
416 |
|
|
|
373 |
|
Interest expense, net |
|
|
(27 |
) |
|
|
29 |
|
|
|
519 |
|
|
|
110 |
|
|
|
|
|
|
|
|
|
|
(Loss)/Income before income taxes |
|
|
(23,662 |
) |
|
|
(5,148 |
) |
|
|
(6,149 |
) |
|
|
15,106 |
|
|
|
|
|
|
|
|
|
|
Income tax (benefit)/expense |
|
|
(5,783 |
) |
|
|
(1,175 |
) |
|
|
(1,837 |
) |
|
|
3,388 |
|
|
|
|
|
|
|
|
|
|
Net (loss)/income |
|
$ |
(17,879 |
) |
|
$ |
(3,973 |
) |
|
$ |
(4,312 |
) |
|
$ |
11,718 |
|
|
|
|
|
|
|
|
|
|
(Loss)/Earnings per share |
|
|
|
|
|
|
|
|
Basic |
|
$ |
(1.60 |
) |
|
$ |
(0.33 |
) |
|
$ |
(0.37 |
) |
|
$ |
0.99 |
|
Diluted |
|
$ |
(1.60 |
) |
|
$ |
(0.33 |
) |
|
$ |
(0.37 |
) |
|
$ |
0.97 |
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
11,166 |
|
|
|
11,863 |
|
|
|
11,593 |
|
|
|
11,852 |
|
Diluted |
|
|
11,166 |
|
|
|
11,955 |
|
|
|
11,593 |
|
|
|
11,970 |
|
|
|
|
|
|
|
|
|
|
Cash dividends declared per share |
|
$ |
0.22 |
|
|
$ |
0.20 |
|
|
$ |
0.82 |
|
|
$ |
0.74 |
|
Table II |
HOOKER FURNISHINGS CORPORATION AND
SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS)/INCOME |
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
For the |
|
|
Thirteen Weeks Ended |
|
Fifty-Two Weeks Ended |
|
|
January 29, |
|
January 30, |
|
January 29, |
January 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
|
|
|
|
Net (loss)/income |
|
$ |
(17,879 |
) |
|
$ |
(3,973 |
) |
|
$ |
(4,312 |
) |
|
$ |
11,718 |
|
Other comprehensive income: |
|
|
|
|
|
|
|
|
Amortization of actuarial gain/(loss) |
|
|
1,142 |
|
|
|
654 |
|
|
|
1,204 |
|
|
|
994 |
|
Income tax effect on amortization |
|
|
(273 |
) |
|
|
(165 |
) |
|
|
(288 |
) |
|
|
(237 |
) |
Adjustments to net periodic benefit cost |
|
|
869 |
|
|
|
489 |
|
|
|
916 |
|
|
|
757 |
|
|
|
|
|
|
|
|
|
|
Total comprehensive (loss)/income |
|
$ |
(17,010 |
) |
|
$ |
(3,484 |
) |
|
$ |
(3,396 |
) |
|
$ |
12,475 |
|
Table III |
HOOKER FURNISHINGS CORPORATION AND
SUBSIDIARIES |
CONSOLIDATED BALANCE SHEETS |
(In thousands) |
As of |
|
January 29, |
|
January 30, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
|
|
|
Assets |
|
|
|
|
Current assets |
|
|
|
|
Cash and cash equivalents |
|
$ |
19,002 |
|
|
$ |
69,366 |
|
Trade accounts receivable, net |
|
|
62,129 |
|
|
|
73,727 |
|
Inventories |
|
|
96,675 |
|
|
|
75,023 |
|
Income tax recoverable |
|
|
3,079 |
|
|
|
4,361 |
|
Prepaid expenses and other current assets |
|
|
6,418 |
|
|
|
5,237 |
|
Total current assets |
|
|
187,303 |
|
|
|
227,714 |
|
Property, plant and equipment, net |
|
|
27,010 |
|
|
|
28,058 |
|
Cash surrender value of life insurance policies |
|
|
27,576 |
|
|
|
26,479 |
|
Deferred taxes |
|
|
14,484 |
|
|
|
11,612 |
|
Operating leases right-of-use assets |
|
|
68,949 |
|
|
|
51,854 |
|
Intangible assets, net |
|
|
31,779 |
|
|
|
23,853 |
|
Goodwill |
|
|
14,952 |
|
|
|
490 |
|
Other assets |
|
|
9,663 |
|
|
|
4,499 |
|
Total non-current assets |
|
|
194,413 |
|
|
|
146,845 |
|
Total assets |
|
$ |
381,716 |
|
|
$ |
374,559 |
|
|
|
|
|
|
Liabilities and Shareholders' Equity |
|
|
|
|
Current liabilities |
|
|
|
|
Current portion of long-term debt |
|
$ |
1,393 |
|
|
$ |
- |
|
Trade accounts payable |
|
|
16,090 |
|
|
|
30,916 |
|
Accrued salaries, wages and benefits |
|
|
9,290 |
|
|
|
7,141 |
|
Customer deposits |
|
|
8,511 |
|
|
|
7,145 |
|
Current portion of lease liabilities |
|
|
7,316 |
|
|
|
7,471 |
|
Other accrued expenses |
|
|
7,438 |
|
|
|
4,264 |
|
Total current liabilities |
|
|
50,038 |
|
|
|
56,937 |
|
Long term debt |
|
|
22,874 |
|
|
|
- |
|
Deferred compensation |
|
|
8,178 |
|
|
|
9,924 |
|
Operating lease liabilities |
|
|
63,762 |
|
|
|
46,570 |
|
Other long-term liabilities |
|
|
843 |
|
|
|
- |
|
Total long-term liabilities |
|
|
95,657 |
|
|
|
56,494 |
|
Total liabilities |
|
|
145,695 |
|
|
|
113,431 |
|
|
|
|
|
|
Shareholders' equity |
|
|
|
|
Common stock, no par value,20,000shares
authorized, |
|
|
|
|
11,197and 11,922 shares issued and outstanding on
each date |
|
50,770 |
|
|
|
53,295 |
|
Retained earnings |
|
|
184,386 |
|
|
|
207,884 |
|
Accumulated other comprehensive loss |
|
|
865 |
|
|
|
(51 |
) |
Total shareholders' equity |
|
|
236,021 |
|
|
|
261,128 |
|
Total liabilities and shareholders' equity |
|
$ |
381,716 |
|
|
$ |
374,559 |
|
|
|
|
|
|
Table IV |
HOOKER FURNISHINGS CORPORATION AND
SUBSIDIARIES |
CONSOLIDATED STATEMENTS OF CASH FLOWS |
(In thousands) |
|
|
|
For the Fifty-Two Weeks Ended |
|
|
January 29, |
|
January 30, |
|
|
|
2023 |
|
|
|
2022 |
|
Operating Activities: |
|
|
|
|
Net (loss)/income |
|
$ |
(4,312 |
) |
|
$ |
11,718 |
|
Adjustments to reconcile net income to net cash |
|
|
|
|
(used in) / provided by operating activities: |
|
|
|
|
Inventory valuation expense |
|
|
28,752 |
|
|
|
3,402 |
|
Depreciation and amortization |
|
|
8,829 |
|
|
|
7,814 |
|
Deferred income tax expense |
|
|
(3,160 |
) |
|
|
2,323 |
|
Non-cash restricted stock and performance awards |
|
|
1,244 |
|
|
|
(28 |
) |
Provision for doubtful accounts and sales allowances |
|
|
(3,673 |
) |
|
|
45 |
|
Gain on life insurance policies |
|
|
(1,179 |
) |
|
|
(1,008 |
) |
Loss / (gain) on disposal of assets |
|
|
94 |
|
|
|
(18 |
) |
Changes in assets and liabilities |
|
|
|
|
Trade accounts receivable |
|
|
16,831 |
|
|
|
9,518 |
|
Inventories |
|
|
(47,827 |
) |
|
|
(8,265 |
) |
Income tax recoverable |
|
|
1,283 |
|
|
|
(4,361 |
) |
Prepaid expenses and other current assets |
|
|
(5,711 |
) |
|
|
(4,400 |
) |
Trade accounts payable |
|
|
(15,781 |
) |
|
|
(1,312 |
) |
Accrued salaries, wages and benefits |
|
|
2,148 |
|
|
|
76 |
|
Accrued income taxes |
|
|
- |
|
|
|
(501 |
) |
Customer deposits |
|
|
(1,911 |
) |
|
|
2,890 |
|
Operating lease assets and liabilities |
|
|
(57 |
) |
|
|
708 |
|
Other accrued expenses |
|
|
3,254 |
|
|
|
908 |
|
Deferred compensation |
|
|
(542 |
) |
|
|
(300 |
) |
Net cash (used in)/provided by operating activities |
|
|
(21,718 |
) |
|
|
19,209 |
|
|
|
|
|
|
Investing Activities: |
|
|
|
|
Acquisitions |
|
|
(25,274 |
) |
|
|
- |
|
Purchases of property, plant and equipment |
|
|
(4,199 |
) |
|
|
(6,692 |
) |
Proceeds from sale of property and equipment |
|
|
- |
|
|
|
18 |
|
Premiums paid on life insurance policies |
|
|
(492 |
) |
|
|
(560 |
) |
Proceeds received on life insurance policies |
|
|
- |
|
|
|
372 |
|
Net cash used in investing activities |
|
|
(29,965 |
) |
|
|
(6,862 |
) |
|
|
|
|
|
Financing Activities: |
|
|
|
|
Proceeds from long-term loans |
|
|
25,000 |
|
|
|
- |
|
Payments for long-term loans |
|
|
(700 |
) |
|
|
- |
|
Proceeds from revolving credit facility |
|
|
36,190 |
|
|
|
- |
|
Payments for revolving credit facility |
|
|
(36,190 |
) |
|
|
- |
|
Debt issuance cost |
|
|
(37 |
) |
|
|
- |
|
Purchase and retirement of common stock |
|
|
(13,342 |
) |
|
|
- |
|
Cash dividends paid |
|
|
(9,602 |
) |
|
|
(8,822 |
) |
Cash provided by/(used in) financing activities |
|
|
1,319 |
|
|
|
(8,822 |
) |
|
|
|
|
|
Net (decrease)/increase in cash and cash
equivalents |
|
|
(50,364 |
) |
|
|
3,525 |
|
Cash and cash equivalents at the beginning of
year |
|
|
69,366 |
|
|
|
65,841 |
|
Cash and cash equivalents at the end of year |
|
$ |
19,002 |
|
|
$ |
69,366 |
|
|
|
|
|
|
Supplemental schedule of cash flow information: |
|
|
|
|
Income taxes paid, net |
|
$ |
101 |
|
|
$ |
5,888 |
|
Interest paid, net |
|
|
642 |
|
|
|
- |
|
|
|
|
|
|
Supplemental schedule of noncash investing activities: |
|
|
|
|
Increase in lease liabilities arising from changes in right-of-use
assets |
|
$ |
25,241 |
|
|
$ |
24,513 |
|
Increase in property and equipment through accrued purchases |
|
|
128 |
|
|
|
15 |
|
|
Table
V |
|
|
HOOKER
FURNISHINGS CORPORATION AND SUBSIDIARIES |
|
|
NET SALES AND
OPERATING (LOSS)/INCOME BY SEGMENT |
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Thirteen
Weeks Ended |
Fifty-Two
Weeks Ended |
|
|
January 29, 2023 |
|
January 30, 2022 |
|
January 29, 2023 |
|
January 30, 2022 |
|
|
|
|
%
Net |
|
% Net |
|
%
Net |
|
% Net |
Net
sales |
|
|
Sales |
|
Sales |
|
Sales |
|
Sales |
Hooker Branded |
|
$ |
49,858 |
|
38.0 |
% |
$ |
43,388 |
|
32.2 |
% |
$ |
199,602 |
|
34.2 |
% |
$ |
200,692 |
|
33.8 |
% |
Home Meridian |
|
|
44,617 |
|
34.0 |
% |
|
60,939 |
|
45.2 |
% |
|
216,338 |
|
37.1 |
% |
|
278,902 |
|
47.0 |
% |
Domestic Upholstery |
|
|
33,735 |
|
25.7 |
% |
|
28,439 |
|
21.1 |
% |
|
156,717 |
|
26.9 |
% |
|
106,827 |
|
18.0 |
% |
All Other |
|
|
3,089 |
|
2.3 |
% |
|
2,039 |
|
1.5 |
% |
|
10,445 |
|
1.8 |
% |
|
7,191 |
|
1.2 |
% |
Consolidated |
|
$ |
131,299 |
|
100 |
% |
$ |
134,805 |
|
100 |
% |
$ |
583,102 |
|
100 |
% |
$ |
593,612 |
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
Operating (loss)/income |
|
|
|
|
|
|
|
|
|
Hooker Branded |
|
$ |
5,098 |
|
10.2 |
% |
$ |
5,628 |
|
13.0 |
% |
$ |
20,529 |
|
10.3 |
% |
$ |
30,667 |
|
15.3 |
% |
Home Meridian |
|
|
(29,892 |
) |
-67.0 |
% |
|
(11,987 |
) |
-19.7 |
% |
|
(37,181 |
) |
-17.2 |
% |
|
(21,260 |
) |
-7.6 |
% |
Domestic Upholstery |
|
|
583 |
|
1.7 |
% |
|
785 |
|
2.8 |
% |
|
8,871 |
|
5.7 |
% |
|
4,675 |
|
4.4 |
% |
All Other |
|
|
532 |
|
17.2 |
% |
|
242 |
|
11.9 |
% |
|
1,735 |
|
16.6 |
% |
|
761 |
|
10.6 |
% |
Consolidated |
|
$ |
(23,679 |
) |
-18.0 |
% |
$ |
(5,332 |
) |
-4.0 |
% |
$ |
(6,046 |
) |
-1.0 |
% |
$ |
14,843 |
|
2.5 |
% |
|
|
|
|
|
|
|
|
|
|
For more information,
contact:
Paul A. Huckfeldt, Senior Vice President
& Chief Financial Officer, Phone: (276) 666-3949
Hooker Furnishings (NASDAQ:HOFT)
Graphique Historique de l'Action
De Mai 2024 à Juin 2024
Hooker Furnishings (NASDAQ:HOFT)
Graphique Historique de l'Action
De Juin 2023 à Juin 2024