Haverty Furniture Companies, Inc. · NYSE:HVT
Haverty Furniture Companies — Investor Presentation (December 2013)
33 slides from Haverty Furniture Companies's investor presentation, Dec 3, 2013
Slide 1: December 3-4, 2013
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Slide 2: Founded in 1885; IPO 1929; Cash dividend since 1935
12/03/2013 • Founded in 1885 • IPO - October 1929 • Cash dividend since 1935 1 2 1
Slide 3: Retail Footprint and Customer Demographics and Psychographics
12/03/2013 Retail Footprint: 119 Stores across 16 states 4.3 M retail sq.ft. Customer Demographics and Psychographics • Women • 80% own a home • Household Income $75k + • Age 35+ • Primarily driven by style • Refreshing the home for variety’s sake • Considers value, but favors selecting right item o
Slide 4: Focused Business Strategy: Brand
12/03/2013 Focused Business Strategy • Brand • Growth Opportunities • Operating Excellence • Returns to Stockholders 5 Focused Business Strategy • Brand • Store • Website, media and other touches • Merchandise • Growth Opportunities • Operating Excellence • Returns to Stockholder 6 3
Slide 5: The STORE is the most powerful physical expression of the brand
12/03/2013 “The STORE is the most powerful physical expression of the brand”.” Steve Jobs 7 “The STORE is the most powerful physical expression of the brand”.” Steve Jobs 8 4
Slide 6: Havertys store imagery
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Slide 7: Havertys store imagery
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Slide 8: Havertys store imagery
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Slide 9: Havertys store imagery
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Slide 10: Focused Business Strategy: Store
12/03/2013 Focused Business Strategy • Brand • Store • Website, media, and other touches • Merchandise • Growth Opportunities • Operating Excellence • Returns to Stockholder 17 Havertys.com - Display and feel mimics store presentation 18 9
Slide 11: Digital and Social Media Stats
12/03/2013 Social Media 220K Fans 5K 19 Digital and Social Media Stats YTD Q3 2013 • Havertys.com - Unique Visitors 6.2 M • Ratings and reviews – avg. 700 per month • Facebook – 370 K avg. weekly reach 220 K Fans • Pinterest – 4,600 Followers • Twitter – 4,800 Followers • Blog – 6,000 average weekly
Slide 12: Television
12/03/2013 Television 21 Focused Business Strategy • Brand • Store • Website, media and other touches • Merchandise • Growth Opportunities • Operating Excellence • Returns to Stockholder 22 11
Slide 13: Merchandise
12/03/2013 Merchandise • Primarily Havertys Brand • Mid- to upper middle price points • Large array of styles • Variety of custom options • Sourced to our specs 23 Strategic Use of Name Brands 24 12
Slide 14: Focused Business Strategy: Growth Opportunities, New Home Sales
12/03/2013 Focused Business Strategy • Brand • Growth Opportunities • Macro environment • Increase sales per sq. ft. • Store growth and improvements • Operating Excellence • Returns to Stockholder 25 NEW SINGLE FAMILY HOME SALES Monthly Data: Seasonally-Adjusted Annualized United States South 1,600
Slide 15: Comp-Store Sales % - Quarterly
12/03/2013 Comp-Store Sales % - Quarterly 2007 2008 2009 2011 2006 2010 2012 2013 27 Focused Business Strategy • Brand • Growth Opportunities • Macro environment • Increase sales per sq. ft. • Store growth and improvements • Operating Excellence • Returns to Stockholder 28 14
Slide 16: Annual Sales / Sq. Ft.
12/03/2013 Annual Sales / Sq. Ft. $220 $1,000 $206 $202 $950 $198 $200 $900 $186 $850 $180 $174 $800 Sales in Millions $160 $158 $160 $750 $148 $148 $700 $139 $140 $650 $600 $120 $550 $100 $500 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 - 9mos 29 Focused Business Strategy • Brand • Growth Opp
Slide 17: Shifting the Media Mix
12/03/2013 Shifting the Media Mix 70% 60% 50% 2001 2009 40% 2010 2011 30% 2012 2013 20% 10% 0% Other / Inserts Television Direct Mail Newspaper Interactive 31 Television 32 16
Slide 18: Emails
12/03/2013 33 Emails • 2 emails per week • 1.2 million customers • Open Rates – 8 – 13 % • Click Thru – avg. 3% 34 17
Slide 19: She is on the go
12/03/2013 Havertys.com 35 She is on the go..…. Customer mobile devices 36 18
Slide 20: Focused Business Strategy: Better product price points
12/03/2013 Focused Business Strategy • Brand • Growth Opportunities • Macro environment • Increase sales per sq. ft. • Traffic • Average Ticket • Store growth and improvements • Operating Excellence • Returns to Stockholder 37 “Better” product price points 38 19
Slide 21: Special Orders -- Simplified
12/03/2013 39 Special Orders -- Simplified 40 20
Slide 22: Complete the Look: FREE In Home Designer Program
12/03/2013 Complete the Look 41 FREE In Home Designer Program Limited introduction: 2012 - 19 designers serving 22 stores 2013 - 45 designers for 55 stores 2014 - 85 designers for up to 100 stores by end of the year 42 21
Slide 23: Average Ticket Initiatives - Results
12/03/2013 Average Ticket Initiatives - Results YTD 9 mos. 2013 • Avg. Retail Selling Price SKU up 4.3% • Avg. ticket up 8.6% • Custom and Special Orders up 22.9% 2012 • Avg. Retail Selling Price SKU up 4.6% over 2011 • Avg. ticket in 2012 up 7.8% over 2011 and in 2012 up 13.2% over 2010 • Custom an
Slide 24: Store Growth; Bright Inspirations
12/03/2013 Store Growth 2014 Plans New store in new market: To be announced Q-4 New store in existing markets: Atlanta, GA Q-3 Dallas/Ft. Worth Q-4 To be announced Q-4 Store relocation: Orlando, FL Q-4 Expand one location: Q-2 Increase in square footage of 3.0% 2013 Expanded three locations Closed t
Slide 25: Capital Expenditures Update
12/03/2013 Capital Expenditures Update Proposed Estimated (Approximate in thousands) 2014 2013 Stores: New or replacement stores $ 9,100 $ 2,100 Remodels/expansions 10,000 9,800 Other improvements 5,000 4,400 Total stores 24,100 16,300 Distribution 3,400 1,900 Information technology 2,500 1,800 Tota
Slide 26: Providing tools and training to upgrade our talent
12/03/2013 Approx. 50% of sales associates use the iPad …Providing tools and training to upgrade our talent to match our customer and grow our business 49 50 25
Slide 27: Control Expense and Maintain Quality
12/03/2013 Control Expense and Maintain Quality • Company Owned & Operated • Standardization • Accountability Yielding fewer exceptions and more routes completed in established times 51 52 26
Slide 28: Strategic Sourcing
12/03/2013 53 Strategic Sourcing • Over 80% of our selected case goods are imported • Direct Imports – 17% of 2012 furniture sales: • Work with outside designers to develop collections • Select factories • Use dedicated quality control team to inspect product in factories 54 27
Slide 29: Sales vs. Pretax by quarter
12/03/2013 Focused Business Strategy • Brand • Growth Opportunities • Operating Excellence • Returns to Stockholders 55 Sales vs. Pretax by quarter 225,000 32,000 200,000 24,000 175,000 16,000 Pretax Profit (Loss) $ thousands Net Sales $ thousands 150,000 8,000 125,000 0 100,000 -8,000 Q1 Q2 Q3 Q4 Q
Slide 30: Consolidated Gross Profit Margin; Profitability Opportunity 2013
12/03/2013 Consolidated Gross Profit Margin 55% $1,000 53.6% 54% $950 53% 52.5% $900 51.9% 51.7% 51.7% 52% 51.4% $850 51% $800 Sales in Millions 49.6% 49.7% 50% $750 48.7% 49% 48.3% 48.3% 47.8% 47.8% $700 48% $650 47% $600 46% 45% $550 44% $500 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Slide 31: Profitability Opportunity 2014; Strong Balance Sheet
12/03/2013 Profitability Opportunity 2014 Pre-Tax Income $ $60.0 10.0% $56M $53M 9.0% $50.0 $49M $45M 8.0% $42M 7.0% $40.0 $38M 7.1% Contribution $ “slope” 6.7% is 36.7% of Sales $34M 6.3% 6.0% $31M 5.9% Pre-Tax Income 5.5% $30.0 $27M 5.1% as a % of Sales5.0% $23M 4.7% 4.2% 4.0% $20M $20.0 3.8% $16M
Slide 32: HVT Stock Price Trading Range; Havertys' Strategic Advantages
12/03/2013 HVT Stock Price Trading Range $35.00 $1,000 $29.78 $950 $30.00 $900 $25.00 $23.98 $850 $800 $18.60 Sales in Millions $20.00 $18.16 $17.15 $17.62 $16.22 $16.27 $750 $15.00 $13.73 $13.93 $13.79 $700 $15.00 $12.66 $650 $10.00 $11.53 $10.39 $9.56 $9.47 $600 $7.76 $7.21 $7.61 $5.00 $550 $- $50
Slide 33: Forward-Looking Statements
12/03/2013 Forward-Looking Statements The forward-looking statements included in this presentation may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements address the financial condition, results of operations, business
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