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From Home Furnishing Business

Strong Q4 Drives Record Year at Hooker Furniture

A robust fourth quarter aided by record shipments from its Home Meridian unit boosted Hooker Furniture’s (NASDAQ: HOFT) top line to $577.2 million for the fiscal year ended Jan. 29.

The company, which completed its acquisition of Home Meridian on Feb. 1, the first day of its fiscal year, also had record net income of $25.3 million or $2.18 per share for the year.

The company said Home Meridian had its strongest quarter of the year in the fourth quarter, with sales jumping 23%. It’s Hooker casegoods and upholstery segments also had strong fourth quarters, with the casegoods business having its best October High Point Market in five years, and the imported upholstery business having the strongest market in its history.

"Outstanding fourth quarter results were driven by Home Meridian's significant backlog at the end of the third quarter, resulting in record shipments in the fourth quarter, along with an excellent fall furniture market and post-market orders at Hooker legacy brands," said Paul Toms Jr., chairman and CEO. “With sales recovering at both Home Meridian and Hooker legacy brands, we demonstrated the significant earnings leverage possible with our asset-light, low fixed cost business model.”

Sales in the most recent fiscal year were more than double the previous year’s figure of $247 million, which didn’t include Home Meridian.

Net income in the just-concluded fiscal year was 56.2% above the previous year’s figures of $16.2 million or $1.49 per share.

In the fiscal fourth quarter, which ended Jan. 29, net sales totaled $173.9 million, up from $60.6 million in the previous year’s fourth quarter, which didn’t include Home Meridian.

Fourth-quarter net income was $10.98 million or 95 cents per share, up from $1.45 million or 38 cents per share in the comparable quarter.

George Revington, Hooker Furniture’s chief operating officer, said the fourth-quarter sales momentum has carried over to the new fiscal year, noting that orders were up 19% for the first two months of the fiscal first quarter.

"This success is a result of the strategies we have in place to address the emerging channels of distribution," Revington said. “The pace of change in the distribution channels for furniture is accelerating. We are taking full advantage of the disruptions occurring in our industry by making positive adjustments to our product assortment and sales focus.”

Toms said he is “fairly bullish about the foreseeable future” because of recent improvements in business.

"We experienced a distinct uptick at retail late in the fall, after the uncertainty of the election was past,” he said. “Consumers seem to have moved off the sidelines and are more willing to commit to larger-ticket purchases. The macroeconomic environment, which we believe is a strong indicator for furniture sales, is generally positive.”



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