Havertys posts first-quarter profit as sales rise 6.1%

Larry Thomas -- Furniture Today, May 3, 2012

ATLANTA — Top 100 retailer Havertys said its first-quarter sales rose 6.1% as the company reversed the net loss recorded in last year's first quarter.

For the quarter ended March 31, the retailer had a profit of $2.46 million or 11 cents per share. That compares with a net loss of $671,000 or 3 cents per share in the same period last year.

First-quarter sales totaled $163.6 million, up from $154.2 million in last year's first quarter.

Havertys said comparable-store were up 5.7%, while gross margins increased one percentage point to 52.2%.

"We were pleased with the earnings results for the first quarter, which were better than our expectations," said Clarence Smith, president and CEO. "Our investments in the customer experience, both in the store and on our website, are important elements for our long-term profitable growth."

Smith said the company's new television advertising campaign, which hit the airwaves in late February, has been well received. During the current quarter, the retailer is targeting specific markets and advertising media to reach its target audience of female consumers.

He noted that the housing market, consumer confidence and the availability of consumer credit have shown some positive movement in recent weeks, which should benefit furniture sales.

"We are cautiously optimistic and believe Havertys is prepared to deliver top-line sales growth, improve profitability and preserve our rock-solid balance sheet," said Smith.

The retailer didn't issue specific sales and earnings guidance, but noted that delivered sales to date are up 6.2% in the current quarter, while written business is flat. Written business for March and April combined is 5.4% ahead of the same two-month period in 2011.

Havertys has 119 stores in 17 southern and Midwestern states.