MARTINSVILLE, VA - Hooker Furniture said second quarter sales rose 16.1 percent versus the same period a year prior. Aided by reduced bottlenecks among Hooker's furniture and supplier partners, sales reached $53.4 million for its fiscal 2011 second quarter ending August 1, 2010; net income increased to $1.2 million, compared to a net loss of $463,000 last year.
"We're pleased to have grown sales in a difficult retail environment and during what is traditionally the weakest quarter for the furniture industry," said Paul B. Toms Jr., chairman and chief executive officer. "It was also gratifying to turn profitability around."
Toms said increased sales were driven by higher unit volume as Hooker made progress in reducing an order backlog "swollen by production delays and shipping bottlenecks" in the prior two quarters. He said sourcing delays that negatively affected sales since last fall have eased somewhat.
"We have made real progress this quarter flowing product," said Toms, though order backlogs "are still slightly above prior-year levels." At the end of the second quarter, Hooker says it had 6.6 weeks of order backlog compared to an 8.2 week backlog at the end of the first quarter and a 5.7 week backlog at the same time a year ago.
"Our manufacturing partners are not yet back to traditional lead times," Toms said, noting gross margins for wood and metal furniture, sourced from outside manufacturers, improved slightly primarily due to decreased levels of product discounting, as well as an exit from Hooker Furniture's California warehouse.
During fiscal 2010 Hooker said it would transition frame production from its Bradington-Young Woodleaf, NC plant (a leased facility) to its Bradington-Young Cherryville, NC plant by the end of December 2009, then announced plans to sell the frame production operation, including the associated machinery, as an ongoing business, but had no luck. As a result it incurred severance charges of $132,000 paid mostly during its fiscal 2010 fourth quarter, plus $80,000 in accelerated depreciation on fixed assets at the Woodleaf location. Hooker also incurred costs in last fiscal year when it underwrote a line of credit for a supplier so it could by raw materials. Hooker says the exit from Woodleaf furniture manufacturing would yield $350,000 in savings annually.
Hooker says margins for upholstered and leather furniture improved moderately, due to lower fixed costs, but these were partially offset by higher raw material and manufacturing costs due to product mix and inefficiencies associated with initial production on April market introductions.
Ranked among the top ten publicly traded furniture producers based on shipments to U.S. retailers, Hooker Furniture imports residential wood and metal furniture from a network of factories throughout the Pacific Rim, Mexico and Central America; Hooker operates plants in North Carolina and Virginia. Based in Martinsville, VA, Hooker's major wood furniture categories include home entertainment, home office, accent, dining and bedroom furniture sold under the Hooker Furniture and Envision Lifestyle Collections by Hooker Furniture brands. Youth bedroom furniture is sold under the Opus Designs by Hooker Furniture brand. Hooker's residential upholstered seating companies include Cherryville, N.C.-based Bradington-Young, a specialist in upscale motion and stationary leather furniture, and Bedford, VA-based Sam Moore Furniture, specializing in upscale occasional chairs with an emphasis on cover-to-frame customization.>>
"We're pleased to have grown sales in a difficult retail environment and during what is traditionally the weakest quarter for the furniture industry," said Paul B. Toms Jr., chairman and chief executive officer. "It was also gratifying to turn profitability around."
Toms said increased sales were driven by higher unit volume as Hooker made progress in reducing an order backlog "swollen by production delays and shipping bottlenecks" in the prior two quarters. He said sourcing delays that negatively affected sales since last fall have eased somewhat.
"We have made real progress this quarter flowing product," said Toms, though order backlogs "are still slightly above prior-year levels." At the end of the second quarter, Hooker says it had 6.6 weeks of order backlog compared to an 8.2 week backlog at the end of the first quarter and a 5.7 week backlog at the same time a year ago.
"Our manufacturing partners are not yet back to traditional lead times," Toms said, noting gross margins for wood and metal furniture, sourced from outside manufacturers, improved slightly primarily due to decreased levels of product discounting, as well as an exit from Hooker Furniture's California warehouse.
During fiscal 2010 Hooker said it would transition frame production from its Bradington-Young Woodleaf, NC plant (a leased facility) to its Bradington-Young Cherryville, NC plant by the end of December 2009, then announced plans to sell the frame production operation, including the associated machinery, as an ongoing business, but had no luck. As a result it incurred severance charges of $132,000 paid mostly during its fiscal 2010 fourth quarter, plus $80,000 in accelerated depreciation on fixed assets at the Woodleaf location. Hooker also incurred costs in last fiscal year when it underwrote a line of credit for a supplier so it could by raw materials. Hooker says the exit from Woodleaf furniture manufacturing would yield $350,000 in savings annually.
Hooker says margins for upholstered and leather furniture improved moderately, due to lower fixed costs, but these were partially offset by higher raw material and manufacturing costs due to product mix and inefficiencies associated with initial production on April market introductions.
Ranked among the top ten publicly traded furniture producers based on shipments to U.S. retailers, Hooker Furniture imports residential wood and metal furniture from a network of factories throughout the Pacific Rim, Mexico and Central America; Hooker operates plants in North Carolina and Virginia. Based in Martinsville, VA, Hooker's major wood furniture categories include home entertainment, home office, accent, dining and bedroom furniture sold under the Hooker Furniture and Envision Lifestyle Collections by Hooker Furniture brands. Youth bedroom furniture is sold under the Opus Designs by Hooker Furniture brand. Hooker's residential upholstered seating companies include Cherryville, N.C.-based Bradington-Young, a specialist in upscale motion and stationary leather furniture, and Bedford, VA-based Sam Moore Furniture, specializing in upscale occasional chairs with an emphasis on cover-to-frame customization.>>
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