Daily News
From Home Furnishing Business
Bassett Reports Lower Sales, Earnings Amid Weak Demand
September 30,
2016 by Jane Chero in Financial Reports, Industry 
Bassett Furniture Inds. (BSET) reported lower sales and earnings in the quarter ended Aug. 27 amid weak consumer demand and lower sales of its imported products.
Net sales totaled $104.7 million, a drop of 5.7% from the same quarter last year. The latest top-line figure included a 6.2% drop in wholesale sales, a 1.3% decline in sales at company-owned retail stores, and a 2.8% drop in revenues from its Zenith Global Logistics subsidiary.
Comparable store sales in the retail division fell 0.9%, but comparable store written sales, which include products sold but not delivered, increase 7.9%.
Net income totaled $4.17 million or 38 cents per share, down 2.4% from $4.27 million or 39 cents per share in the same quarter last year.
"Despite facing an environment of weaker demand for home furnishings during our third quarter, our level of profitability remained intact while consolidated sales declined by 5.7%," said Robert Spilman Jr., Chairman and CEO. "We were especially encouraged by the 7.9% comparable store written sales gain that we posted in the period. With our factories running efficiently and our inventory levels in good shape, we are positioned to service our Labor Day sales and meet demand for the historically stronger fall selling season."
Spilman said domestically-made products accounted for 69% of wholesale sales, reflecting the growing popularity of the customization available with its U.S.-made wood and upholstery offerings.
"Our wholesale sales decline was primarily attributable to sales of imported products to customers outside of our store network, most notably one major account that we discontinued our relationship with earlier in the year,” he explained. “We will be introducing a new range of motion upholstery products designed specifically for non-Bassett store markets at the upcoming High Point furniture market in three weeks.”
On the retail side, he said two stores have been opened this year and three were closed when their leases expired. Next year, he said five to six stores will be opened and four others repositioned.
And the end of the quarter, there were 59 company-owned and 32 licensee-owned Bassett Home Furnishings stores.
For the nine months ended Aug. 27, sales rose 0.9% to $318.3 million. Nine-month net income fell more than 26% to $10.78 million or $1 per share.