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Hooker profit jumps 23.8%

By Larry Thomas -- Furniture Today, January 23, 2005

Martinsville, Va. — Powered by sizable gains at its Bradington-Young upholstery unit and its imported furniture line, Hooker Furniture posted double-digit sales and earnings increases in its fiscal year ended Nov. 30.

The case goods and upholstery resource said total sales came to $345.9 million, a jump of 12% from the 2003 fiscal year. Net income surged 23.8% to $18.2 million, or $1.56 per share.

In its fourth quarter, Hooker posted sales of $91.9 million, a 15.4% increase over sales of $79.7 million in the final quarter of 2003. Net profits in the latest quarter skyrocketed 51.5% to $5.4 million.

"We're gratified that we were able to deliver a record year despite significant expenses," said Chairman and CEO Paul Toms Jr.

He attributed the sales increase to unit volume growth in Hooker's imported wood and metal furniture lines, as well as the Bradington-Young unit, which the company acquired in January 2003.

Bradington-Young's 2004 sales totaled $57.5 million, up from $44.2 million in the 11 months of 2003 that Hooker owned it. The 2004 figure represented 16.6% of Hooker's total sales, up from 14.3% in 2003.

"This year, Bradington-Young began to attain the revenue level we envisioned when we acquired that business," Toms said, noting the company has broadened its line and increased the sales force four-fold.

Sales of imported wood and metal furniture leaped 24.7% to $185.4 million, or 53.6% of total sales. Domestic wood furniture sales, on the other hand, dropped 11.3% to $103 million.

Toms said net income, despite a significant jump over 2003, was hurt by a $1.6 million pretax charge related primarily to the October closing of its Maiden, N.C., wood furniture factory. He said the plant closing should reduce production costs by $2 million to $2.5 million annually.

"Now that production capacity and overhead are better aligned with demand for domestically produced wood furniture, we have been able to increase work schedules at our three remaining wood furniture plants," said Toms. "Operating these three plants closer to capacity should reduce overhead costs as a percentage of sales."

Hooker sold the Maiden plant's machinery and equipment in December, and closed on the sale of the property Jan. 14.

The company said sales for the first quarter of the current year should be up 4% to 7%.

Hooker Furniture (a)
Owns Bradington-Young
Earnings per share are fully diluted.
Quarter ended 11/30	2004	2003	Change
(a) Includes the results of Bradington-Young from its Jan. 2003 acquisition. (b) Includes a $369,000 pretax restructuring and asset impairment credit consisting of a $599,000 reduction in the asset impairment charge recorded in the third quarter of 2004, partially offset by costs of $230,000 incurred to prepare the property for sale. (c) Includes after-tax restructuring and asset impairment charges of $1 million in the 2004 year and $911,000 in the 2003 year.
Sales	$91,923,000	$79,665,000	15.4%
Operating income	9,269,000	6,198,000	49.5%
Net income	(b)5,447,000	3,596,000	51.5%
Earnings per share	0.46	0.31	48.4%
Year ended 11/30	2004	2003	Change
Sales	$345,944,000	$309,005,000	12.0%
Operating income	32,770,000	27,222,000	20.4%
Net income (c)	18,204,000	14,710,000	23.8%
Earnings per share	1.56	1.28	21.9%

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