Nova Lifestyle Profits Soar Following Sale of Factories
Nova Lifestyle (NASDAQ: NVFY), parent company of Diamond Sofa and several other brands, said third-quarter net income soared to $2.96 million of 11 cents per share as the company began implementing its “asset light” business model following the sale of its manufacturing operations earlier this year.
The most recent quarter’s bottom line beat last year’s third quarter by some 900%, when net income totaled $301,337 or 1 cent per share.
Sales in the most recent quarter rose 8.8% to $33.2 million.
Last year’s third quarter included a loss of $743,600 from its discontinued manufacturing operations.
The company said the third quarter was highlighted by strong demand across all of its product lines and a 200% increase in new product offerings.
“We are pleased to have delivered stellar financial results,” said Tawny Lam, CEO. “Nova LifeStyle’s third quarter financial performance reflects the results of our successful transformation from an ‘asset heavy’ furniture manufacturing business to a ‘light asset,’ high margin, consumer product company focused on innovative product designs and customer-centric marketing.”
Sales for the first nine months of 2017 totaled $70.8 million, down from $72.7 million in last year’s third quarter.
Nine-month net income totaled $2.3 million or 8 cents per share. In the first nine months of last year, the company had a loss of $287,306 or 1 cent per share. That figure included a loss of $1.48 million from is manufacturing operations.
“We continue to see consistent growth leading into the 4th quarter as well as 2018,” Lam said, “If this continues, we hope to initiate stock buybacks or start paying cash dividends in the near future to reward our long-term shareholders, as a way to maximize customer and shareholder value.”