ATLANTA, Aug. 5 /PRNewswire-FirstCall/ -- HAVERTY FURNITURE COMPANIES, INC. (NYSE:HVTNYSE:andNYSE:HVT.A) today reported a loss for the second quarter ended June 30, 2009. The net loss for the second quarter of 2009 was $6.6 million or $0.31 per diluted share of Common Stock, as compared to the second quarter 2008 net loss of $2.3 million or $0.11 per diluted share of Common Stock.
For the six months ended June 30, 2009, the net loss was $13.8 million or $0.65 per diluted share of Common Stock versus a net loss of $1.3 million or $0.06 per diluted share of Common Stock for the same period in 2008.
As previously reported, net sales for the second quarter of 2009 were $129.7 million, a decrease of 23.0% compared to sales of $168.4 million for the corresponding quarter in 2008. Comparable-store sales decreased 22.6% for the quarter.
Total written business for the third quarter to date is down 19.6% versus the same period last year.
Clarence H. Smith, president and chief executive officer, said, "Our efforts remain concentrated on necessary operational adjustments to the difficult market conditions, closely managing our capital and clearly communicating Havertys' strong value proposition to the consumer. We believe these initiatives are imperative to maintaining our financial and brand strength.
"The second quarter is historically the weakest of the year. We began during this time to highlight our high value price point merchandise and became somewhat more promotional to reach the spending-conscious consumer. Our careful merchandising and inventory management kept second quarter gross margins slightly higher both sequentially for the year and compared to last year's period.
"During the second quarter our SG&A expenses were reduced by $17.4 million or 19.2% compared to last year's second quarter and were down $31.5 million or 17.0% for the first half of the year. We have improved our warehousing and delivery throughput efficiencies as we adjusted our scale of operations to lower volume levels. Alterations in our advertising and marketing spend have also generated additional cost reductions.
"We have continued to outsource most customer financing and our accounts receivable have been reduced by $3.3 million in the second quarter and $9.5 million in the first six months of 2009. Inventories are $6.0 lower than at March 31, 2009 and $10.3 lower than at the end of 2008 as we reduced merchandise purchases given the weakened demand. We have no funded borrowings and our cash at June 30, 2009 is $22.4 million, up $12.9 million during the second quarter and $18.7 million during the first half of the year.
"Our efforts to emphasize the value attribute in addition to the quality and service hallmarks of the Havertys brand are important to our current sales efforts. We are carefully conveying in this value message that there has not been a fundamental change in our merchandise or how we interact with the customer. This approach and conservative financial management are essential to our survival of this economic firestorm and future success." Havertys is a full-service home furnishings retailer with 121 showrooms in 17 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 web site at http://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.
The company will sponsor a conference call Thursday, August 6 at 10:00 a.m. Eastern Daylight Time to review the second quarter. Listen-only access to the call is available via the web at http://www.havertys.com/ (About Us, Investor Information) and at http://www.streetevents.com/ (Individual Investor Center), both live and for a limited time, on a replay basis.
HAVERTY FURNITURE COMPANIES, INC. and SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Amounts in thousands except per share data)
(Unaudited) Quarter Ended Six Months Ended
June 30, June 30,
--------------------- ---------------------
2009 2008 2009 2008
---------- ---------- ---------- ---------- Net sales $129,683 $168,412 $273,921 $353,665
Cost of goods sold 63,062 82,158 133,537 170,975
---------- ---------- ---------- ----------
Gross profit 66,621 86,254 140,384 182,690 Credit service charges 311 497 704 1,062
---------- ---------- ---------- ----------
Gross profit and other
revenue 66,932 86,751 141,088 183,752 Expenses:
Selling, general and
administrative 72,860 90,222 153,738 185,260
Interest, net 203 206 380 75
Provision for doubtful
accounts 247 284 662 612
Other expense
(income), net 141 (77) 20 (119)
---------- ---------- ---------- ----------
Total expenses 73,451 90,635 154,800 185,828
---------- ---------- ---------- ---------- Loss before income taxes (6,519) (3,884) (13,712) (2,076) Income tax expense (benefit) 63 (1,575) 133 (799)
---------- ---------- ---------- ---------- Net loss $(6,582) $(2,309) $(13,845) $(1,277)
========== ========== ========== ========== Basic and diluted loss per
Share(1):
Common Stock $(0.31) $(0.11) $(0.65) $(0.06)
Class A Common Stock $(0.30) $(0.11) $(0.62) $(0.06) Weighted average shares -
basic:
Common Stock 17,397 17,162 17,360 17,137
Class A Common Stock 3,987 4,105 3,996 4,116
Weighted average shares -
assuming dilution(1):
Common Stock 21,384 21,267 21,356 21,253
Class A Common Stock 3,987 4,105 3,996 4,116 Cash dividends per common
share:
Common Stock - $0.0675 - $0.1350
Class A Common Stock - $0.0625 - $0.1250
(1) See additional details at the end of this release.
HAVERTY FURNITURE COMPANIES, INC. and SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Amounts in thousands)
(Unaudited)
June 30, December 31, June 30,
2009 2008 2008
---------- ---------- ---------- Assets
Cash and cash equivalents $22,355 $3,697 $1,926
Accounts receivable,
net of allowance 14,982 24,301 40,017
Inventories, at LIFO cost 93,421 103,743 104,873
Other current assets 14,147 18,005 19,814
---------- ---------- ----------
Total current assets 144,905 149,746 166,630 Accounts receivable, long-term 1,240 2,082 3,185
Property and equipment, net 183,825 197,423 204,114
Other assets 14,140 14,142 25,054
---------- ---------- ---------- $344,110 $363,393 $398,983
========== ========== ==========
Liabilities and Stockholders' Equity
Notes payable to banks $- $- $5,400
Accounts payable and
accrued liabilities 63,321 71,359 66,206
Current portion of long-term debt
and lease obligations 332 311 17,179
---------- ---------- ----------
Total current liabilities 63,653 71,670 88,785 Long-term debt and lease
obligations, less current portion 7,014 7,183 7,346
Other liabilities 41,440 39,572 28,995
Stockholders' equity 232,003 244,968 273,857
---------- ---------- ---------- $344,110 $363,393 $398,983
========== ========== ========== HAVERTY FURNITURE COMPANIES, INC. and SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Amounts in thousands)
(Unaudited) Six Months Ended June 30,
2009 2008
---------- ---------- Operating Activities
Net loss $(13,845) $(1,277)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization 10,115 10,853
Provision for doubtful accounts 662 612
Gain on sale of property and equipment (19) -
Other 1,255 690 Changes in operating assets and liabilities 15,679 (1,039)
---------- ---------- Net cash provided by operating activities 13,847 9,839
---------- ---------- Investing Activities
Capital expenditures (1,263) (5,171)
Proceeds from sale-leaseback transaction 6,625 -
Proceeds from sale of property and equipment 29 203
Other investing activities 43 282
---------- ---------- Net cash provided by (used in)
investing activities 5,434 (4,686)
---------- ---------- Financing Activities
Proceeds from borrowings under revolving credit
facilities 5,800 127,765
Payments of borrowings under revolving credit
facilities (5,800) (122,365)
---------- ---------- Net increase (decrease) in borrowings under
revolving credit facilities - 5,400
Payments on long-term debt and lease obligations (148) (4,159)
Treasury stock acquired - (1,806)
Dividends paid - (2,829)
Other financing activities (475) -
---------- ---------- Net cash used in financing activities (623) (3,394)
---------- ---------- Increase (decrease) in cash and cash equivalents 18,658 1,759 Cash and cash equivalents at beginning of period 3,697 167
---------- ---------- Cash and cash equivalents at end of period $22,355 $1,926
========== ========== HAVERTY FURNITURE COMPANIES, INC. and SUBSIDIARIES Earnings per Share
------------------ The following details how the loss and number of shares in
calculating the diluted loss per share for Common Stock are
derived under SFAS 128 and EITF 03-6 (amounts in thousands): Quarter Ended Six Months Ended
June 30, June 30,
--------------------- ---------------------
2009 2008 2009 2008
---------- ---------- ---------- ----------
Numerator:
Common:
Distributed earnings $- $1,161 $- $2,315
Undistributed loss (5,403) (3,035) (11,356) (3,342)
---------- ---------- ---------- ----------
Basic (5,403) (1,874) (11,356) (1,027)
Class A Common loss (1,179) (435) (2,489) (250)
---------- ---------- ---------- ----------
Diluted $(6,582) $(2,309) $(13,845) $(1,277)
========== ========== ========== ==========
Class A Common:
Distributed earnings $- $256 $- $514
Undistributed loss (1,179) (691) (2,489) (764)
---------- ---------- ---------- ----------
$(1,179) $(435) $(2,489) $(250)
========== ========== ========== ==========
Denominator:
Common:
Weighted average shares
outstanding - basic 17,397 17,162 17,360 17,137 Assumed conversion of Class
A Common Stock 3,987 4,105 3,996 4,116
---------- ---------- ---------- ---------- Total weighted-average
diluted Common Stock 21,384 21,267 21,356 21,253
========== ========== ========== ========== Class A Common:
Weighted average shares
outstanding 3,987 4,105 3,996 4,116
========== ========== ========== ========== Contact for information:
Dennis L. Fink, EVP & CFO or
Jenny Hill Parker, VP, Secretary & Treasurer
404-443-2900
DATASOURCE: Haverty Furniture Companies, Inc.
CONTACT: Dennis L. Fink, EVP & CFO, or Jenny Hill Parker, VP, Secretary & Treasurer, both of Haverty Furniture Companies, Inc., +1-404-443-2900 Web Site: http://www.havertys.com/
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