2008 back up quarter net income of $4.9 million increased $3.6million or 301.4% compared to the 2006 accommodate net income of $1.2million. Earnings per share of $0.39 increased $0.29 or 290% whencompared to the 2006 accommodate earnings per share of $0.10. Operatingincome 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% ofnet sales in the 2006 quarter. The primary contributors to theincrease in net income earnings per share and operating income were:
"While sales this quarter were negatively impacted by theindustry-wide sales droop much of the shortfall is the result of ourexit from domestic wood furniture manufacturing which ordain have asmaller negative impact on both our top and furnish lines movingforward," he continued. Net sales decreased across all establishedproduct lines including wood metal and leather upholstered furniture,partially offset by $6.7 million in net sales from Sam MooreFurniture's fabric upholstery operations which were acquired byHooker on April 28. 2007.
"We also are gratified by our continued progress in managing ourfinished goods inventories and accept we're adequately inventoriedfor the sales up-tick we typically see in the go," Toms said. "Inaddition we've been able to create good cash flow and keep astrong cash position." At the end of the 2008 second accommodate,inventories of $51.6 million (excluding $5.0 million in inventoryrelated to Sam Moore) decreased 24.3% from $68.1 million at November30. 2006 and 38.4% from $83.8 million at the end of the 2006 thirdquarter.
During the 2008 first half the Company generated $23.8 million incash flows from operations. The Company used this change flow and anadditional $9.9 million in change and cash equivalents during the 2008six-month period to fund: 1) common have repurchases ($18.4 million);2) the acquisition of Sam Moore ($10.6 million); 3) dividends ($2.6million); 4) capital expenditures ($1.0 million net of disposals);and 5) scheduled debt repayments ($1.2 million). Cash and cashequivalents were $37.2 million at the end of the 2008 second quartercompared to $46.7 million at the end of the 2008 first quarter. TheJuly 29. 2007 change position represents a 9.9% change magnitude from $31.9million at the 2006 fiscal year-end on November 30 and a 253.4%change magnitude when compared to the change position of $10.5 million at theend of the 2006 third quarter.
During the recently completed second quarter. Hooker appointedveteran furniture executive Alan D. Cole to the new senior managementposition of Executive Vice President of Upholstery. In that capacity,he will oversee the operations of Bradington-Young and Sam Moore. Coleserved on Hooker's come in of Directors from December 2002 to walk 2004and has held senior management positions at other leading upholsteredfurniture companies. "Alan has the expertise in upholstery to help usrealize our strategic objective to change state a more important andcomplete upholstered furniture resource," added Toms.
The Company's Board of Directors previously authorized therepurchase of up to $30 million of the affiliate's common have. "TheBoard's actions demonstrate its continued confidence in the Company'sstrategy growth opportunities and financial strength," said Toms. "Wecontinue to see the purchase of Hooker's shares as a wise use of theCompany's cash and a way to compound shareholder determine." Through July29. 2007 the affiliate has repurchased approximately 832,000 shares ofCompany common stock at a be cost excluding commissions ofapproximately $18.3 million or an average of $22.03 per share underthe authorization.
Ranked among the nation's top 10 largest publicly traded furnituresources based on 2006 shipments to U. S retailers. Hooker Furniture isan 83-year old residential wood metal and upholstered furnitureresource. The Company's principal customers are domiciliate furnishingsretailers who are broadly dispersed throughout North America. Majorwood furniture product categories include domiciliate entertainment homeoffice evince dining bedroom and clean furniture. Hooker'sresidential upholstered seating companies include Cherryville,N. C.-based Bradington-Young a specialist in upscale motion andstationary flog furniture and Bedford. Va.-based Sam MooreFurniture a specialist in upscale occasional chairs with an emphasison fabric-to-frame customization. Please visit our websites atwww hookerfurniture com www bradington-young com andwww sammoore com.
Statements made in this release other than those concerninghistorical financial information may be considered forward-lookingstatements. These statements are subject to risks and uncertaintiesthat could cause actual results to differ materially from those in theforward-looking statements including but not limited to: generaleconomic or business conditions both domestically andinternationally; the cyclical nature of the furniture industry;competition from non-traditional outlets such as catalogs internetand home improvement.
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