Hooker profit up 20.7%
By Furniture Today Staff -- Furniture Today, April 9, 2006
Martinsville, Va. — Stronger sales of imported wood and metal furniture helped Hooker Furniture to a 20.7% increase in first-quarter earnings, the company reported.
Sales of $85.3 million in the three months ended Feb. 28 were up 6% from the same period a year earlier. Earnings came to $3.6 million.
"We are pleased to have turned the corner and be back on track with positive sales growth," said Paul Toms Jr., chairman and CEO. After posting 13 straight quarters of growth, Hooker's sales in the last three quarters of fiscal 2005 were down in the low single digits from the 2004 periods.
Toms said orders for imported wood and metal furniture were stronger throughout the quarter, and that the company benefited from better import product availability.
"We are beginning to see results from our initiatives in supply chain management, and we expect that our ability to flow product to our customers in a timely manner will continue to improve," he said.
Toms said management was "disappointed we couldn't convert our sales increase into an even greater profit increase." Higher warehousing and distribution costs associated with the growth in imported wood and metal furniture shipments were a factor, he said, adding, "We expect to lower inventory and warehousing costs going forward by editing our product offerings and through improved demand forecasting."
Wood and metal furniture sales rose 7.6% in the quarter to $69.5 million. Imported wood was especially strong, rising 25.4% to $54.4 million and offsetting a 28.9% decline in domestic wood furniture sales, which fell to $15.1 million.
Sales of Bradington-Young's leather upholstery declined slightly to $15.8 million.
"We've experienced a modest softening in demand for domestically produced upholstered furniture but growing sales in the imported Seven Seas Seating category," Toms said. "We have initiatives under way that we believe will have a positive impact on Bradington-Young's business for both domestically produced and imported upholstered products."
He said that based on continuing improvement in product availability and a backlog of orders spurred by its October market intros, the company is forecasting that second-quarter up 3% to 7%.
| Hooker Furniture | |||
|---|---|---|---|
| Owns Bradington-Young | |||
| Earnings per share are fully diluted. | |||
| Quarter ended 2/28 | 2006 | 2005 | Change |
| (a) Includes pretax restructuring and impairment charges of $188,000 in the 2006 quarter and $366,000 in the 2005 quarter in restructuring, asset impairment and other costs related to closing plants. |
|||
| Sales | $85,339,000 | $80,526,000 | 6.0% |
| Operating income | 5,963,000 | 5,445,000 | 9.5% |
| Net income (a) | 3,560,000 | 2,950,000 | 20.7% |
| Earnings per share | 0.30 | 0.25 | 20.0% |
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Hooker earnings surge 20.7% in first quarter
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