Earnings Disclosure

Q3 2013 Haverty Furniture Companies, Inc. Earnings Conference Call

Thursday, October 31, 2013 10:00 a.m. ET  

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Stock Quote

HVT (Common Stock)

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Havertys Reports Record Third Quarter 2013 EPS of $0.42

Atlanta, Georgia, October 30, 2013 - HAVERTYS  (NYSE: HVT and HVT.A) reports earnings per share for the third quarter ended September 30, 2013 of  $0.42 compared to $0.15 for the same period of 2012.  The earnings per share for the nine months ended September 30, 2013 is $0.99 compared to $0.36 for the same period of 2012.  

Clarence Smith, chairman, president and CEO, said "We are reaching our customers in new ways and providing inspiration, information and assistance so she can confidently turn her vision of home into a reality.  Our teams have been engaged in enriching the shopping experience across all channels and offering captivating products with great fabrics, finishes and function.   Operationally we are refining productivity benchmarks and continue to strive to grow market share and comparable store sales.  We believe the geographic regions in which our stores are located coupled with our financial strength and positioning of the Havertys brand will fuel our growth as housing and employment improve.

Financial Highlights

Third Quarter 2013 Compared to Third Quarter 2012

  • Net sales increased 11.6% to $192.7 million.  Comparable store sales were up 11.8%.  Total written business was up 7.3% and average ticket rose 5.6%.  

  • Gross profit margins increased 140 basis points to 53.9% from 52.5% as a percent of sales.  This includes a year-over-year benefit of 40 basis points from changes in the LIFO reserve. 

  • Selling, general and administrative costs as a percent of sales decreased by 350 basis points to 45.8% from 49.3% as fixed and discretionary costs were leveraged  

  • Pre-tax earnings of $15.4 million increased 470 basis points to 8.0% from 3.3% as a percent of sales. 

  • Our retail store count at September 30, 2013 was 119 versus 120 at September 30, 2012.   

Nine Months ended September 30, 2013 Compared to Same Period of 2012

  • Net sales increased 12.7% to $549.9 million.  Comparable store sales were up 11.5%.  Average ticket increased 8.6%. 

  •  Gross profit margins increased 130 basis points to 53.7%.  Excluding LIFO and the impact of a $0.8 million out-of-period adjustment in the first quarter, gross profit margin increased 110 basis points to 53.6% from 52.5% as a percent of sales. 

  • Selling, general and administrative costs as a percent of sales decreased 290 basis points to 46.9% from 49.8% due to leveraging fixed and discretionary costs.  The $15.4 million increase in dollars is primarily related to increases in:  commissions, wages, incentive compensation, related payroll costs, delivery expense, depreciation and advertising. 

Expectations and Other

  • Written business for the fourth quarter to date of 2013 is up approximately 5.6% over the 16.7% increase that had been achieved for the same period last year. 

  • Our year-to-date gross profit margin excluding the out-of-period adjustment and assuming no LIFO impact was 53.6% as a percent of net sales.  We anticipate this run rate is a reasonable expectation for the next few quarters barring the effect of LIFO accounting for any future changes in landed merchandise costs. 

  • Fixed and discretionary type expenses within SG&A costs for the full year 2013 are expected to be slightly above the high end of the $220 to $222 million range we have previously discussed.  These expenses will generally increase 3% to 5% annually due to inflation, expansion, staffing, and decisions made on the level of advertising spend.   The variable costs within SG&A for the full year 2013 are anticipated to be slightly below the lower end of the range of 17.0% to 17.5% as a percent of sales. 

  • Selling square footage is estimated to decrease 2.2% in 2013 based on the net effect of closing three stores in the first half and the recently completed remodeling and expansion of three stores.  Planned capital expenditures are expected to be $22 million in 2013. 

  • We expect to increase selling square footage approximately 3% in 2014 based on increasing our store count by a net three locations.  Capital expenditures are estimated in the $25 to $29 million range in 2014 depending on the timing of expenditures for new locations. 



HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data - Unaudited)

    Three Months Ended
September 30,
Nine Months  Ended
September 30,
2013 2012 2013 2012
           
Net sales   $ 192,722   $ 172,677   $ 549,926   $ 487,766
Cost of goods sold 88,845 82,004 254,430 232,002
      Gross profit 103,877 90,673 295,496 255,764
Credit service charges 78 69 240 216
      Gross profit and other revenue 103,955 90,742 295,736 255,980
     
Expenses:
      Selling, general and administrative 88,286 85,082 258,145 242,728
      Interest, net 282 154 837 473
      Provision for doubtful accounts 51 30 96 101
      Other (income) expense, net (52 ) (160 ) (46 ) (745 )
      88,567 85,106 259,032 242,557
     
Income before income taxes 15,388 5,636 36,704 13,423
Income tax expense 5,894 2,322 14,120 5,291
      Net income   $ 9,494   $ 3,314   $ 22,584   $ 8,132
     
Basic earnings per share:
      Common Stock   $ 0.42   $ 0.15   $ 1.01   $ 0.37
      Class A Common Stock   $ 0.40   $ 0.14   $ 0.96   $ 0.35
     
Diluted earnings per share:
      Common Stock   $ 0.42   $ 0.15   $ 0.99   $ 0.36
      Class A Common Stock   $ 0.40   $ 0.14   $ 0.95   $ 0.35
     
Basic weighted average shares outstanding:
      Common Stock 20,047 19,163 19,786 19,018
      Class A Common Stock 2,455 2,887 2,606 2,986
     
Diluted weighted average shares outstanding:
      Common Stock 22,855 22,371 22,783 22,319
      Class A Common Stock 2,455 2,887 2,606 2,986
         
Cash dividends per share:
     Common Stock   $ 0.080   $ 0.0400   $ 0.16   $ 0.080
     Class A Common Stock   $ 0.075   $ 0.0375   $ 0.15   $ 0.075



HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands - Unaudited)

       September 30,
2013
   December 31,
2012
   September 30,
2012
     (Unaudited) (Unaudited)
ASSETS
Current assets         
      Cash and cash equivalents  $ 72,078  $ 53,550  $ 75,026
      Restricted cash and cash equivalents 7,016 7,013 7,011
      Accounts receivable 8,102 9,710 9,564
      Inventories 91,600 96,902 84,530
      Prepaid expenses 7,298 9,532 9,762
      Other current assets 4,052 3,187 5,509
            Total current assets 190,146 179,894 191,402
    
Accounts receivable, long-term 845 814 529
Property and equipment 191,491 193,085 187,033
Deferred income taxes 23,823 24,366 23,526
Other assets 4,243 3,937 3,908
            Total assets  $ 410,548  $ 402,096  $ 406,398
     
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
      Accounts payable  $ 20,281  $ 28,178  $ 23,451
      Customer deposits 23,045 20,963 21,676
      Accrued liabilities 35,312 33,272 34,146
      Deferred income taxes 6,601 6,595 6,996
      Current portion of lease obligations 928 881 819
            Total current liabilities 86,167 89,889 87,088
    
Lease obligations, less current portion 16,451 18,473 12,447
Other liabilities 27,006 34,306 34,442
            Total liabilities 129,624 142,668 133,977
     
Stockholders' equity 280,924 259,428 272,421
            Total liabilities and stockholders' equity  $ 410,548  $ 402,096  $ 406,398



HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands - Unaudited)

    Nine Months Ended
September 30,
2013      2012
CASH FLOWS FROM OPERATING ACTIVITIES:
     Net  income $ 22,584 $ 8,132
     Adjustments to reconcile net income to net
  cash provided by operating activities:
          Depreciation and amortization 15,811 14,334
          Share-based compensation expense 2,682 1,944
          Provision for doubtful accounts 96 101
          Other 394 534
     Changes in operating assets and liabilities:
          Accounts receivable 1,481 1,706
          Inventories 5,302 8,914
          Customer deposits 2,082 7,104
          Other assets and liabilities (3,538 ) (1,647 )
          Accounts payable and accrued liabilities (5,857 ) 7,193
               Net cash provided by operating activities 41,037 48,315
    
CASH FLOWS FROM INVESTING ACTIVITIES:
     Capital expenditures (16,720 ) (20,166 )
     Other 7 244
               Net cash used in investing activities (16,713 ) (19,922 )
    
CASH FLOWS FROM FINANCING ACTIVITIES:
     Payments on lease obligations (643 ) (553 )
     Dividends paid (3,564 ) (1,750 )
     Proceeds from exercise of stock options 872 84
     Taxes on vested restricted shares (2,461 ) (515 )
     Treasury stock acquired - (218 )
               Net cash used in financing activities (5,796 ) (2,952 )
Increase in cash and cash equivalents during the period 18,528 25,441
Cash and cash equivalents at beginning of period 53,550 49,585
Cash and cash equivalents at end of period $ 72,078 $ 75,026




About Havertys

Havertys (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 the SEC.

Conference Call Information

The company invites interested parties to listen to the live audiocast of the conference call on Thursday, October 31, 2013 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 approximately 12:00 p.m. EDT through Thursday, November 7, 2013. The number to access the telephone playback is 1-800-406-7325 (access code: 4647482#).

Contact:
Havertys 404-443-2900
Dennis L. Fink
            EVP & CFO
Jenny Hill Parker
            SVP, Finance, Secretary and Treasurer

SOURCE:  Havertys


HUG#1739421

Havertys Announces Timing of Third Quarter Earnings Release and Investor Conference Call

ATLANTA, Georgia, October 24, 2013  -  HAVERTYS (NYSE: HVT and HVT.A) will release third quarter 2013 financial results on Wednesday, October 30, 2013, after the market closes.  Havertys will host a conference call with investors and analysts on Thursday, October 31, 2013 at 10:00 a.m. EDT to discuss the results of its operations.

The company invites interested parties to listen to the live audiocast of the conference call at its website, www.havertys.com/investors.  A replay will be available at the website or via telephone at approximately 12:00 p.m. EDT through Thursday, November 7, 2013.  The number to access the telephone playback is 1-800-406-7325 (access code: 4647482#).

The aforementioned conference call will contain forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995.  The statements may be made a number of times throughout the call and may be identified by such forward-looking terminology as "expect," "believe," "may," "will," "intend" or similar statements or variations of such terms.  Such forward-looking statements involve certain substantial risks and uncertainties including levels of sales and competitive pressures from other home furnishings retailers.  These and other important factors that may cause actual results to differ materially from such forward-looking statements are detailed from time to time in the company's reports filed with the Securities and Exchange Commission.  You are urged to consider such factors.  The company assumes no obligation for updating any such forward-looking statements.

Havertys, 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.

Contact:
Haverty Furniture Companies, Inc., 404-443-2900
Jenny Hill Parker
  SVP, Finance, Secretary and Treasurer

SOURCE:  Haverty Furniture Companies, Inc.


HUG#1738094