Bassett sales up 1.8% as company stores produce first quarterly profit
Jay McIntosh -- Furniture Today, July 5, 2012
BASSETT, Va. — Bassett Furniture said its sales rose 1.8% to $67.5 million in its second quarter, ended May 26, and the company posted a $1.6 million operating profit versus an operating loss a year ago.
A small part of the profit - about $100,000 - came from the 50 company-owned Bassett Home Furnishings stores, the first time the retail operation has ended a quarter in the black.
"Our corporate retail group produced a milestone achievement this quarter by producing their first ever quarterly operating profit," said Rob Spilman, Bassett's president and CEO. "This marks the fifth consecutive quarter of year over year improvement for the segment."
Bassett's net income for the quarter was $8 million or 71 cents per share, thanks to a $9 million distribution from the U.S. government of antidumping duties paid by importers of Chinese bedroom furniture. In the comparable quarter last year, net income was $62.6 million or $5.39 per share, due mainly to an $85.5 million gain on the sale of the company's interest in High Point's International Home Furnishings Center.
The company said the latest quarter's operating profit, a turnaround from the $14.3 million operating loss a year earlier, was attributable to increased gross margins and reduced bad debt, restructuring and other expenses.
Wholesale segment sales of $45.9 million were just barely ahead of the $45.8 million posted a year earlier, the company said.
Company-owned store sales came to $42.6 million, up 12.6% from $38 million a year earlier, with same-store sales rising 7.9%.
"We were pleased to achieve sales growth in our wholesale segment despite operating fewer stores than we did in the same period of fiscal 2011, primarily due to increased market share with independent furniture stores," said Spilman. "In addition, the debut of the HGTV Furniture Collection in our new HGTV showroom at the April High Point Market was very encouraging as we placed the assortment with several major new customers. These products will begin to ship in September of this year and will continue to be phased in to our dealers through the first quarter of 2013."
He added that the company opened a new store in Paramus, N.J., in late May and plans a new store in Dallas this year.
"Meanwhile, we will focus on the conversion of our in-store design centers to HGTV Design Studios at Bassett that will be rolled out later this summer and featured nationally on the HGTV network beginning Labor Day weekend," Spilman said.