MARTINSVILLE, VA - Hooker Furniture more than doubled net income in its first quarter ended May 5.
Hooker Furniture posted a Q1 profit of $2.1 million on net sales of $56.3 million compared to net earnings of $1.0 milloin on net sales of $51.7 million for Q1 2012.
The 108% increase in net income was driven not only by the 8.8% increase in net sales, but by reduced product costs, decreased product discounting on casegoods and higher operating profitability for Hooker's domestic upholstery manufacturing operations - Bradington-Young and Sam Moore.
Paul Toms Jr., chairman and CEO, noted that the company was "able to more than double consolidated net profit while absorbing start-up costs associated with two new business ventures we are launching to expand our business beyond our core customer demographic and reach additional consumers on each end of the age spectrum."
Hooker Furniture is preparing to launch its new ready-to-assemble Homeware product line on two eCommerce websites later this summer. The RTA furnishings, which Hooker Furniture said requires no tools to assemble, are targeted at young Milenials.
In April, Hooker introduced its H Contract brand, which cater to retirees moving into senior living facilities; Toms said the ranks of this type of customer "are projected to triple in the next 20 years."
Start-up costs for the Homeware and H Contract lines were about $440,000 before tax, Toms said.
"With all the positive news surrounding housing and rising consumer confidence, it would be hard not to be optimistic about our prospects," Toms said. "We're bullish about our future, both with our core business and our new ventures. Internally, we believe we are well positioned to capitalize on the improving economy as we ramp up our manufacturing facilities, maintain a good inventory position and enjoy our strongest product line in several years. During the month of May, we have seen much stronger demand for our product than a year ago, which we attribute to the vitality of our freshened line up and better retail conditions. Although we are entering what is traditionally the slowest season of the year for furniture, we have considerable momentum."
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