May 01, 2014 4:50 PM
Atlanta, Georgia ,May 1, 2014 -HAVERTYS (NYSE: HVT and HVT.A) reports earnings per share for the first quarter endedMarch 31, 2014 of$0.27 compared to$0.36 for the same period of 2013. The first quarter of 2013 included an out-of-period adjustment which favorably impacted gross profit by$0.8 million or$.02 per share after tax.Clarence H. Smith , chairman, president and CEO, said, "In early April we announced that first quarter comparable store sales were 0.9% lower than the same quarter last year when comps had been up 11.5%. Earnings for the first quarter are slightly better than anticipated at the time of the sales release as we achieved very good gross profit margins due to our exclusive merchandise and pricing discipline and contained our fixed and discretionary costs. We are glad to report that our sales momentum has picked up in April. Our comparable store written business is currently trending up 7.5% quarter to date after adjusting for the Easter calendar shift. Total written business is up 6.4% on top of the 19% produced last year for this period after adjusting for the calendar differences. Our store growth and repositioning is well underway as we work to open three new stores in our largest markets, including a smaller format designed for dense urban areas. These combined with the three store relocations and two closures will increase our retail square footage about 1.8% by the end of 2014. We believe measured expansion and our ongoing focus on the customer and her Havertys shopping experience will provide growth in the near and long term." Financial Highlights First Quarter 2014 Compared to First Quarter 2013 * Total net sales declined 2.3% to$181.7 million . Comparable store sales were down 0.9% from the 11.5% increase for the same period last year. Comparable store sales increased 7.3% in 30 of our southern locations not impacted by the severe winter weather. * Total written sales were up 0.9% and written comparable store sales were up 2.6%. Our stores are closed on Easter, so both of these amounts were adjusted downward 1.3% to compensate for that holiday falling in March last year and April this year. * Average written ticket continues to grow, up 5.1% over the comparable period and up 3.3% sequentially. The custom order portion of upholstery sales increased 11.0%. * Gross profit margins increased 30 basis points to 53.8% as a percent of sales compared to 53.5%, which excludes the 45 basis point positive impact the adjustment noted above. * Selling, general and administrative costs increased$1.0 million due to additional expenses for advertising of$0.6 million , higher warehouse and delivery costs of$0.9 million , partly offset by reduced administrative expenses of$0.4 million . Total SG&A costs were 160 basis points higher due to the deleveraging of fixed and discretionary costs on the lower sales. * Pre-tax earnings of$10.0 million decreased 170 basis points to 5.5% from 7.2% as a percent of sales. * Our retail store count atMarch 31, 2014 was 119 versus 121 atMarch 31, 2013 . Expectations and Other * We expect that our annual gross profit margins for 2014 will be approximately 53.8%, slightly ahead of the adjusted 53.7% achieved in 2013. * Planned capital expenditures for 2014 are$35.0 million .HAVERTY FURNITURE COMPANIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In Thousands, except per share data - Unaudited) Three Months Ended March 31, ----------------------------- 2014 2013 ---------------------------- Net sales $ 181,737 $ 186,090 Cost of goods sold 83,875 85,781 ------------- ------------- Gross profit 97,862 100,309 Credit service charges 81 86 ------------- ------------- Gross profit and other revenue 97,943 100,395 ------------- ------------- Expenses: Selling, general and administrative 87,674 86,662 Interest, net 273 278 Provision for doubtful accounts 48 13 Other (income) expense, net (8 ) (8 ) ------------- ------------- 87,987 86,945 ------------- ------------- Income before income taxes 9,956 13,450 Income tax expense 3,827 5,190 ------------- ------------- Net income $ 6,129 $ 8,260 ------------- ------------- Basic earnings per share: Common Stock $ 0.27 $ 0.37 Class A Common Stock $ 0.26 $ 0.35 Diluted earnings per share: Common Stock $ 0.27 $ 0.36 Class A Common Stock $ 0.26 $ 0.34 Basic weighted average shares outstanding: Common Stock 20,157 19,717 Class A Common Stock 2,358 2,781 Diluted weighted average shares outstanding: Common Stock 22,928 22,955 Class A Common Stock 2,358 2,781 Cash dividend per common share: Common Stock $ 0.080 0.0400 Class A common Stock $ 0.075 0.0375HAVERTY FURNITURE COMPANIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In Thousands - Unaudited) December March 31, 31, March 31, 2014 2013 2013 ------------- ------------ ---------------- (Unaudited) (Unaudited) ASSETS Current assets Cash and cash equivalents $ 84,508 $ 83,185 $ 53,869 Restricted cash and cash equivalents 8,017 7,016 7,014 Accounts receivable 7,421 8,172 9,102 Inventories 95,964 91,483 97,567 Prepaid expenses 6,853 6,494 7,545 Other current assets 2,796 4,349 4,886 ------------- ------------ ---------------- Total current assets 205,559 200,699 179,983 Accounts receivable, long- term 752 832 823 Property and equipment 187,850 189,242 190,812 Deferred income taxes 13,203 13,253 24,184 Other assets 14,479 13,829 4,112 ------------- ------------ ---------------- Total assets $ 421,843 $ 417,855 $ 399,914 ------------- ------------ ---------------- LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable $ 18,082 $ 21,810 $ 20,780 Customer deposits 24,745 19,008 20,859 Accrued liabilities 32,208 36,338 40,089 Current portion of lease obligations 1,012 959 908 ------------- ------------ ---------------- Total current liabilities 76,047 78,115 82,636 Lease obligations, less current portion 15,916 16,196 17,229 Other liabilities 26,270 25,280 32,261 ------------- ------------ ---------------- Total liabilities 118,233 119,591 132,126 ------------- ------------ ---------------- Stockholders' equity 303,610 298,264 267,788 ------------- ------------ ---------------- $ 421,843 $ 417,855 $ 399,914 ------------- ------------ ----------------HAVERTY FURNITURE COMPANIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands - Unaudited) Three Months Ended March 31, ---------------------------- 2014 2013 ------------- ------------- CASH FLOW FROM OPERATING ACTIVITIES Net income $ 6,129 $ 8,260 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 5,380 5,342 Share-based compensation expense 926 803 Provision for doubtful accounts 48 13 Other 120 (216 ) Changes in operating assets and liabilities: Accounts receivable 783 586 Inventories (4,481 ) (665 ) Customer deposits 5,737 (104 ) Other assets and liabilities 1,664 (1,454 ) Accounts payable and accrued liabilities (7,858 ) (7,176 ) ------------- ------------- Net cash provided by operating 8,448 5,389 activities ------------- ------------- CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures (4,518 ) (3,972 ) Restricted cash and cash equivalents (1,000 ) (1 ) Proceeds from sale of assets 409 2 ------------- ------------- Net cash used in investing activities (5,109 ) (3,971 ) ------------- ------------- CASH FLOWS FROM FINANCING ACTIVITIES Payments on lease obligations (227 ) (216 ) Dividend paid (1,789 ) (883 ) ------------- ------------- Net cash used in financing activities (2,016 ) (1,099 ) ------------- ------------- Increase in cash and cash equivalents during the 1,323 319 period Cash and cash equivalents at beginning of period 83,185 53,550 ------------- ------------- Cash and cash equivalents at end of period $ 84,508 $ 53,869 ------------- ------------- About HavertysHavertys (NYSE: HVT and HVT.A), established in 1885, is a full-service home furnishings retailer with 119 showrooms in 16 states in the Southern and Midwestern regions providing its customers with a wide selection of quality merchandise in middle to upper-middle price ranges. Additional information is available on the company's website at www.havertys.com News releases include forward-looking statements, which are subject to risks and uncertainties. Factors that might cause actual results to differ materially from future results expressed or implied by such forward-looking statements include, but are not limited to, general economic conditions, the consumer spending environment for large ticket items, competition in the retail furniture industry and other uncertainties detailed from time to time in the company's reports filed with theSEC . Conference Call Information The company invites interested parties to listen to the live audiocast of the conference call on Friday, May 2, 2014 at its website, www.havertys.com under the investor relations section. If you can not listen live, a replay will be available on the day of the conference call at the website or via telephone at approximately12:00 p.m. EDT throughFriday, May 9, 2014 . The number to access the telephone playback is 1-800-406-7325 (access code: 4680924#). Contact:Haverty Furniture Companies, Inc. , 404-443-2900Dennis L. Fink EVP & CFOJenny Hill Parker SVP, Finance, Secretary and Treasurer SOURCE: Havertys This announcement is distributed byGlobeNewswire on behalf ofGlobeNewswire clients. The owner of this announcement warrants that: (i) the releases contained herein are protected by copyright and other applicable laws; and (ii) they are solely responsible for the content, accuracy and originality of the information contained therein. Source:Haverty Furniture Company viaGlobeNewswire [HUG#1782171]