Hooker Furnishings Reports Third Quarter Results

About this update from Hooker Furnishings Corporation

[{"type":"text","content":"MARTINSVILLE, Va., Dec. 09, 2021 (GLOBE NEWSWIRE) -- Hooker Furnishings Corporation (NASDAQ-GS: HOFT) today reported consolidated net sales of $133.4 million for its fiscal 2022 third quarter ended October 31, 2021, a $16.3 million, or 11%, decrease compared to the prior year period. Consolidated operating loss for the fiscal 2022 third quarter was $1.7 million, compared to $13 million of operating income in the prior year period. Net loss for the third quarter of fiscal 2022 was $1.2 million, or $0.10 per diluted share, as compared to a net income of $10.1 million, or $0.84 per diluted share, in the third quarter of fiscal 2021. The third quarter revenue decline follows two consecutive quarters of double-digit sales and income gains at Hooker Furnishings and was driven by significantly reduced shipments in the Home Meridian segment (HMI) due to COVID-related factory closures in Vietnam and Malaysia. The HMI sales decrease was partially offset by double-digit sales increases in the Hooker Branded and Domestic Upholstery segments versus the prior year period. These two segments have provided five consecutive quarters of higher net sales. Consolidated operating income and margin decreased in the quarter primarily due to the sales volume reduction at HMI, along with higher freight and product costs. In addition, HMI had three unusual charges during the period, including $2.6 million in one-time order cancellation costs to exit the ready-to-assemble (RTA) furniture category. This was a move HMI made to improve long-term profitability by eliminating a low-margin category. Also, HMI experienced higher than expected chargebacks with two clubs channel customers which negatively impacted net sales and operating income by $1.9 million. “Despite favorable demand for home furnishings and a historically strong order backlog triple typical levels for Hooker Furnishings, we were challenged by ongoing supply chain disruptions, especially the slower-than-expected reopening of Vietnam and Malaysia factories,” said Jeremy Hoff, chief executive officer. “The COVID-related factory closings in Vietnam and Malaysia began around August 1st and did not begin reopening until late in the quarter, and then at only about 25% capacity,” he said. “We expect the factories will begin to approach 50% capacity in the near future.” “Industry-wide inflationary pres...

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