Hooker's profit jumps 20%
Larry Thomas -- Furniture Today, July 31, 2006
Martinsville, Va. — Helped by a record number of container-direct shipments in late May, Hooker Furniture said sales in its second quarter rose 2.3%.
The top-line increase translated into a net income gain of 20%, due largely to improved sales of higher-margin products.
"Profitability was positively impacted by increased volume and by product mix," said Chairman and CEO Paul Toms Jr.
In the quarter ended May 31, total sales were $90.7 million, up from $88.7 million in last year's second quarter. Net income came to $5.8 million or 49 cents per share, compared with $4.9 million or 41 cents per share a year earlier.
During the last two weeks of the quarter, Toms said the company was able to ship about $3 million worth of container-direct merchandise that it didn't think would be ready to ship. That led to a record-setting month for container-direct shipments, he said.
Hooker, which recently said it would close its Roanoke, Va., factory in August, said second-quarter sales of domestically made wood furniture fell 43.4%, while shipments of imported wood and metal furniture rose 24.2%.
The company's Bradington-Young upholstery unit didn't fare quite as well. Second-quarter sales declined 4% to $17.1 million, while sales for the first half slid 2.4% to $32.9 million.
Hooker's total sales for the first half rose 4% to $176 million, while net income rose 20.3% to $9.4 million or 79 cents per share.
Toms expects business conditions "to remain very challenging for the near term" because of factors such as rising interest rates, a housing slowdown, higher energy costs and a weak stock market.
"We don't expect conditions to improve until late in the third quarter, at best, at which time we will be in a strong inventory position to quickly take advantage of the upturn," he said.
| Hooker Furniture | |||
|---|---|---|---|
| Owns Bradington-Young | |||
| Earnings per share are fully diluted. | |||
| Quarter ended 5/31 | 2006 | 2005 | Change |
| (a) Includes a $120,000 pretax restructuring and asset impairment charge in the 2006 quarter. (b) Includes $308,000 in pretax restructuring and asset impairment charges in the 2006 half, and $366,000 for restructuring, asset impairment and other charges related to closing plants. | |||
| Sales | $90,694,000 | $88,698,000 | 2.3% |
| Operating income | 9,480,000 | 8,305,000 | 14.1% |
| Net income (a) | 5,832,000 | 4,859,000 | 20.0% |
| Earnings per share | 0.49 | 0.41 | 19.5% |
| 6 months ended 5/31 | 2006 | 2005 | Change |
| Sales | $176,033,000 | $169,224,000 | 4.0% |
| Operating income | 15,443,000 | 13,750,000 | 12.3% |
| Net income (b) | 9,392,000 | 7,809,000 | 20.3% |
| Earnings per share | 0.79 | 0.66 | 19.7% |
