Hooker Q4, FY Net Drops

Hooker FurnitureMARTINSVILLE, Va.-Startup costs for two new businesses cut into Hooker Furniture’s bottom line for both the fourth quarter and the fiscal year.

Fourth-quarter net income fell 45.9 percent to $2 million, bringing total net income for the fiscal year ending on Feb. 2 to $7.9 million, down 8.1 percent from the prior fiscal year. The two new businesses which debuted during the year were H Contract, which furnishes upscale senior living facilities; and Homeware, a direct-to-consumer e-commerce operation. Together, these new ventures reduced pretax operating income for the year by about $1.5 million.

Also hurting the bottom line in the fourth quarter, net sales decreased by 3.5 percent to $57.6 million. For the year, net sales rose 4.5 percent to $228.3 million. Sales for the year got a boost from higher average selling prices for both of Hooker’s operating segments, casegoods and upholstery. The gain was partly offset by higher discounting and returns, along with allowances in the casegoods segment and five fewer shipping days than in the prior fiscal year.

Paul Toms Jr., Hooker’s chairman and CEO, said the year was one of big accomplishments for the company, with the launch of the two businesses and increased sales across both segments. Excluding the startup costs for H Contract and Homeware, Hooker would have been more profitable than in the previous fiscal year, Toms said.

Looking ahead, Toms said retail conditions have been improving since February, an impression he confirmed in talks with retail customers during this month’s High Point Market. “There’s a firmer foundation under key indicators for our industry, like housing, jobs, the stock market and consumer confidence,” he said. “For both the near and long term, we are fairly bullish.”