Hooker Furniture Reports 3Q Results

December 11, 2013  by in Casegoods, Financial Reports, Industry, Product, Upholstery   

Sales for the quarter were $59.1 million, a 4.1 percent increase over $56.8 million reported in the third quarter last year.

For the fiscal 2014 first nine months, net sales increased 7.6 percent to $170.7 million, and net income increased 20.3 percent to $5.9 million.

"We're pleased with our year-to-date sales performance and the strength of incoming orders and backlogs as we enter a historically strong retail furniture-selling season," said Paul Toms, chairman and CEO. "This was one of our strongest shipping quarters in the last five years, and demand is up for both case goods and upholstery compared to a year ago. We had our second largest shipping quarter in five years, exceeded only slightly by last year's fourth quarter, which had an extra week. Our written business at the October High Point Market was the best in the last three years."

Hooker attributed its third-quarter sales gain to higher average selling prices in case goods and upholstery. For the nine-month period, sales increased were attributed to higher average prices in both categories and increased volume in upholstery.

Toms attributed the decline in net income for the  third quarter to increased discounting in case goods to dispose of slow-moving inventory, start-up costs for H Contract and Homeware brands and production ramp-up costs at Sam Moore.

"Our case goods inventories are still above targeted levels, and we've had higher discounts, primarily related to groups and product lines we are discontinuing," Toms said. "With Homeware and H Contract, we anticipated start-up costs and spending would come before revenues on both these long-term strategic initiatives. Our profitability challenges at Sam Moore revolve around the ramp-up of production and higher labor costs to meet demand that's increased 15 percent to 20 percent per year during the last two-and-a-half years."