Haverty Furniture(HVT) - 2025 Q2 - Quarterly Results

Havertys Furniture Q2 2025 Earnings Release Operating Results Highlights The company reports its first year-over-year sales growth since Q4 2022, though diluted EPS declined - The company achieved year-over-year sales growth for the first time since Q4 2022, alongside strong gross margins and positive traffic trends, despite a challenging economic environment[2] Q2 2025 vs. Q2 2024 Key Metrics | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Diluted EPS | $0.16 | $0.27 | | Consolidated Sales | $181.0M (+1.3%) | $178.6M | | Comparable Store Sales | -2.3% | N/A | | Gross Profit Margin | 60.8% | 60.4% | Financial Performance Analysis A detailed analysis of sales, profitability, expenses, balance sheet, and cash flow for Q2 and H1 2025 is presented Second Quarter 2025 vs. Second Quarter 2024 Q2 2025 saw a 1.3% sales increase and improved gross margin, but higher SG&A expenses impacted profitability Q2 2025 Sales Performance | Metric | Change | | :--- | :--- | | Total Sales | +1.3% | | Comp-Store Sales | -2.3% | | Total Written Business | +0.4% | | Comp-Store Written Business | -2.1% | - Gross profit margins increased to 60.8% in Q2 2025 from 60.4% in Q2 2024[7] - SG&A expenses increased by $4.2 million, driven by higher administrative, occupancy, and advertising costs[7] Balance Sheet and Cash Flow The company maintained a strong balance sheet with $113.8 million in cash and no debt as of June 30, 2025 - The company has a strong balance sheet with $113.8 million in cash and cash equivalents and no debt outstanding as of June 30, 2025[7] Cash Flow and Shareholder Returns (Six Months Ended June 30, 2025) | Item | Amount (in millions) | | :--- | :--- | | Cash from Operating Activities | $13.4 | | Capital Expenditures | ($11.7) | | Free Cash Flow | $1.7 | | Dividends Paid | $10.4 | | Share Repurchases | $2.0 | | Total Cash Returned to Shareholders | $12.4 | 2025 Outlook and Guidance Full-year 2025 guidance is reaffirmed for gross margin and fixed SG&A, with a lowered outlook for variable SG&A - The company is monitoring tariff developments and the current guidance excludes the effects of additional proposed tariffs[7] Full Year 2025 Guidance | Metric | Guidance Range/Value | | :--- | :--- | | Gross Profit Margins | 60.0% to 60.5% (Unchanged) | | Fixed & Discretionary SG&A | $291.0M to $293.0M (Unchanged) | | Variable SG&A (% of sales) | 18.5% to 18.8% (Decreased) | | Effective Tax Rate | ~26.5% (Excluding discrete items) | | Capital Expenditures | ~$24.0M | Consolidated Financial Statements Unaudited condensed financial statements provide a quantitative view of the company's performance and position Condensed Consolidated Statements of Income Q2 2025 net income fell to $2.7 million from $4.4 million year-over-year due to higher SG&A expenses Q2 2025 Income Statement Highlights (in thousands) | Account | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net sales | $181,025 | $178,636 | | Gross profit | $110,102 | $107,984 | | SG&A | $107,333 | $103,099 | | Income before income taxes | $4,326 | $6,453 | | Net income | $2,689 | $4,438 | | Diluted EPS (Common) | $0.16 | $0.27 | Condensed Consolidated Balance Sheets Total assets were $642.7 million as of June 30, 2025, with cash decreasing and inventories increasing Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $107,357 | $120,034 | | Inventories | $93,270 | $83,419 | | Total current assets | $236,148 | $238,896 | | Total assets | $642,672 | $648,747 | | Total current liabilities | $130,514 | $131,565 | | Total liabilities | $337,801 | $341,186 | | Stockholders' equity | $304,871 | $307,561 | Condensed Consolidated Statements of Cash Flows Net cash from operations decreased to $13.4 million for the first six months of 2025, driven by inventory changes Six-Month Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months 2025 | Six Months 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $13,377 | $17,542 | | Net cash used in investing activities | ($11,683) | ($15,900) | | Net cash used in financing activities | ($14,237) | ($13,352) | | Net decrease in cash | ($12,543) | ($11,710) | | Cash at end of period | $113,771 | $116,067 | Supplemental Information Additional context includes non-GAAP reconciliations, metric definitions, and investor information GAAP to Non-GAAP Reconciliation EBITDA for the first six months of 2025 increased to $18.7 million from $16.8 million in the prior year EBITDA Reconciliation (Six Months Ended June 30, in thousands) | Line Item | 2025 | 2024 | | :--- | :--- | :--- | | Income before income taxes | $9,619 | $9,648 | | Interest income, net | ($2,746) | ($3,022) | | Depreciation and amortization | $11,831 | $10,147 | | EBITDA | $18,704 | $16,773 | Definitions and Classifications Key definitions for comp-store sales and classifications for gross profit and SG&A expenses are provided - Comparable-store sales indicate the performance of existing stores and the website by comparing sales growth over the corresponding month in the prior year[16] - The company's gross profit may not be comparable to other retailers because it includes most occupancy and home delivery costs within SG&A expense rather than Cost of Goods Sold[17] - SG&A expenses are classified as variable (selling, delivery) and fixed/discretionary (rent, advertising, administrative)[18] Company and Investor Information Logistical and legal information for investors includes conference call details and a Safe Harbor statement - A conference call is scheduled for July 31, 2025, at 10:00 a.m. ET[19] - Havertys, established in 1885, is a full-service home furnishings retailer with 129 showrooms in 17 states[20] - The release contains forward-looking statements subject to the safe harbor provisions, which involve risks and uncertainties[21][24]