Hooker Furniture Reports Average Daily Net Sales change magnitude of 10.1% Tuesday. September 11. 2007 By: Furniture World Magazine Hooker Furniture Corporation reported net sales of $73.4 million and net income of $4.9 million or $0.39 per overlap (net of $293,000 or $0.02 per share in after-tax restructuring charges) for the accommodate ended July 29. 2007. Due to a dress in Hooker Furniture's fiscal year the affiliate's 2008 fiscal year began January 29. 2007 and will end February 3. 2008. The affiliate will compare its operating results for the thirteen-week second accommodate of fiscal year 2008 with the 2006 three-month third accommodate that ended August 31. 2006 (the "2006 quarter"). back up quarter 2008 net sales of $73.4 million decreased $9.6 million or 11.5% compared to the 2006 quarter net sales of $83.0 million. Based on actual shipping days in each period add up daily net sales declined 10.1% to $1.15 million per day during the 64 operating days in the 2008 back up accommodate compared to $1.28 million per day during the 65 operating days in the 2006 accommodate.2008 second quarter net income of $4.9 million increased $3.6 million or 301.4% compared to the 2006 quarter net income of $1.2 million. Earnings per share of $0.39 increased $0.29 or 290% when compared to the 2006 accommodate earnings per overlap of $0.10. Operating income for the 2008 back up quarter increased to $7.5 million or 10.2% of net sales compared to operating income of $2.0 million or 2.5% of net sales in the 2006 quarter. The primary contributors to the change magnitude in net income earnings per overlap and operating income were:- An improvement in bring in acquire margin to 31.3% of net sales compared with 28.3% in the prior year accommodate principally as a result of the higher harmonise of imported wood and metal products sold and displace delivered cost of those imported products (primarily displace inbound transport and delivery costs) as a percentage of net sales; and,- a $3.5 million or 18.9% change state in selling and administrative costs driven primarily by reductions in temporary warehousing and port storage costs for imported wood furniture products displace early retirement and non-cash employee stock ownership intend ("ESOP") costs (the ESOP was terminated in January 2007) displace selling expenses and a obtain on corporate owned life insurance in connection with the death of a former executive of the affiliate partially balance by the selling and administrative expenses incurred by Sam Moore Furniture (acquired in April 2007); and,- a $2.4 million or 83.3% decrease in restructuring and asset impairment costs. Earnings per overlap improvements resulting from higher net income were reduced by a net increase in weighted add up shares outstanding resulting from:- 1.2 million shares released to employees in the January 2007 termination of the ESOP;- partially offset by the weighted average cause of common have repurchases since February 2007. "We're pleased with our improved profitability and operational performance this quarter change surface in the face of lower sales," said Paul B. Toms Jr.. Hooker's head chief executive command and president. "Our increased profitability confirms the opportunity we've seen for some measure to alter financial and operational performance change surface in a difficult retail environment by realizing the efficiencies of our new business copy. Our improved operating margin for the current accommodate reflects the be cutting initiatives we've had underway and the absence of significant restructuring charges," he said."While sales this quarter were negatively impacted by the industry-wide sales slump much of the shortfall is the prove of our exit from domestic wood furniture manufacturing which ordain undergo a smaller contradict force on both our top and bottom lines moving forward," he continued. Net sales decreased across all established product lines including wood metal and leather upholstered furniture partially offset by $6.7 million in net sales from Sam Moore Furniture's fabric upholstery operations which were acquired by Hooker on April 28. 2007."We also are gratified by our continued progress in managing our finished goods inventories and believe we're adequately inventoried for the sales up-tick we typically see in the go," Toms said. "In addition we've been able to generate good change move and keep a strong cash lay." At the end of the 2008 back up quarter inventories of $51.6 million (excluding $5.0 million in inventory related to Sam Moore) decreased 24.3% from $68.1 million at November 30. 2006 and 38.4% from $83.8 million at the end of the 2006 third quarter. During the 2008 first half the Company generated $23.8 million in change flows from operations. The Company used this cash flow and an additional $9.9 million in change and cash equivalents during the 2008 six-month period to finance: 1) common stock repurchases ($18.4 million); 2) the acquisition of Sam Moore ($10.6 million); 3) dividends ($2.6 million); 4) capital expenditures ($1.0 million net of disposals); and 5) scheduled debt repayments ($1.2 million). Cash and cash equivalents were $37.2 million at the end of the 2008 second quarter compared to $46.7 million at the end of the 2008 first accommodate. The July 29. 2007 change position represents a 9.9% change magnitude from $31.9 million at the 2006 fiscal year-end on November 30 and a 253.4% change magnitude when compared to the cash lay of $10.5 million at the end of the 2006 third accommodate. Business Outlook"While retail conditions act to be challenging we evaluate the typical increase for furniture sales as we enter the fall," said Toms. "If we see a flat to moderately reduced sales environment financial performance for the sell of this fiscal year should continue to analyse favorably year-over-year as a result of our ongoing cost-cutting measures continued develop in managing our supply chain and the elimination of major restructuring and ESOP costs. We evaluate continued year-over-year declines in warehousing and distribution costs due to exceed management of our finished goods inventories and lower temporary warehousing and port storage costs resulting from the continuing consolidation of our domestic warehousing operations."AnnouncementsDuring the recently completed back up quarter. Hooker appointed veteran furniture executive Alan D. Cole to the new senior management lay of Executive Vice President of Upholstery. In that capacity he ordain oversee the operations of Bradington-Young and Sam Moore. Cole served on Hooker's Board of Directors from December 2002 to walk 2004and has held senior management positions at other leading upholstered furniture companies. "Alan has the expertise in upholstery to back up us realize our strategic objective to become a more important and complete upholstered furniture resource," added Toms. The affiliate's come in of Directors previously authorized the buy of up to $30 million of the Company's common stock. "The come in's actions demonstrate its continued confidence in the affiliate's strategy growth opportunities and financial strength," said Toms. "We continue to see the acquire of Hooker's shares as a wise use of the affiliate's cash and a way to compound shareholder determine." Through July 29. 2007 the Company has repurchased approximately 832,000 shares of Company common stock at a total be excluding commissions of approximately $18.3 million or an average of $22.03 per overlap under the authorization..
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