Hooker Furniture(US:HOFT)2025-12-11 11:01Financial Performance - Hooker Furnishings reported a consolidated net sales decrease of 14.4% in Q3, primarily due to an $11 million reduction in shipments from the Samuel Lawrence Hospitality segment[8]. - Net sales for the thirteen weeks ended November 2, 2025, were $70,730,000, a decrease of 14.5% compared to $82,670,000 for the same period in 2024[27]. - Consolidated net sales for the thirteen weeks ended November 2, 2025, were $70,730 million, down from $82,670 million in the same period of 2024, representing a decrease of 14.4%[38]. - Gross profit for the thirty-nine weeks ended November 2, 2025, was $52,736,000, down from $55,681,000 in 2024, reflecting a decline of 3.4%[28]. - The company reported a net loss of $21,174,000 for the thirteen weeks ended November 2, 2025, compared to a net loss of $4,131,000 for the same period in 2024[30]. - Basic loss per share for the thirteen weeks ended November 2, 2025, was $1.99, compared to a loss of $0.39 per share in the same period of 2024[28]. - Operating loss for the thirty-nine weeks ended November 2, 2025, was $17,418,000, compared to an operating loss of $9,581,000 in 2024[28]. - Net loss for the thirty-nine weeks ended November 2, 2025, was $27,503 million, compared to a loss of $10,174 million for the same period in 2024[35]. Cost Management - The company achieved approximately $25–$26.5 million in annualized savings from its multi-phase cost-reduction program, reducing its overall cost structure by 25% over the past 18 months[4][6]. - Selling and administrative expenses for the thirty-nine weeks ended November 2, 2025, were $52,667,000, down from $62,408,000 in 2024, indicating a reduction of 15.6%[28]. Impairment Charges - The company recorded non-cash impairment charges totaling $22.1 million in Q3, impacting its operating loss of $16.3 million for the quarter[8]. - The company incurred goodwill and trade name impairment charges of $15,576,000 for the thirteen weeks ended November 2, 2025, compared to $781,000 in the same period of 2024[28]. - The company reported a tradename impairment of $15,576 million for the thirty-nine weeks ended November 2, 2025, compared to $778 million in the previous year[35]. Sales and Orders - Hooker Branded net sales increased by 1.1% in both Q3 and the nine-month period, driven by higher average selling prices despite lower unit volume[7]. - Domestic Upholstery net sales rose by $870,000, or 3.0%, in Q3, with a mixed performance across divisions[13]. - Order backlog declined by 10.3% from fiscal year-end and 23.8% from the prior-year Q3, attributed to a large hospitality project in the previous year[8]. - The order backlog as of November 2, 2025, was $32,735 million, a decrease from $42,938 million in October 2024, reflecting a decline of 23.7%[41]. Cash and Liquidity - Cash and cash equivalents decreased to $1.4 million, with $63.8 million in available borrowing capacity as of quarter-end[11][12]. - Cash used in financing activities for the thirty-nine weeks ended November 2, 2025, was $25,511 million, compared to $8,311 million in the same period of 2024, indicating increased cash outflows[36]. - Cash and cash equivalents decreased from $6,295 million at the beginning of the year to $1,354 million at the end of the quarter, a decline of 78.4%[36]. Strategic Initiatives - A new share repurchase program has been authorized, allowing the company to repurchase up to $5 million of its outstanding common shares, alongside a recalibrated dividend reduced by 50% to $0.46 per share annually[14][15]. - The launch of the Margaritaville licensed collection is expected to drive significant organic growth, supported by a 14,000-square-foot showroom and 55 committed retail galleries across the U.S.[4]. - The company aims to improve profitability despite macroeconomic challenges, focusing on its core businesses for sustainable growth[18]. Risks and Challenges - Future risks include potential adverse political acts affecting international markets and the cyclical nature of the furniture industry, which is sensitive to consumer confidence[24]. - The company plans to monitor macroeconomic conditions and adjust its strategies accordingly to mitigate risks associated with consumer spending patterns[24]. Assets and Liabilities - Total assets decreased from $313,942 million in February 2025 to $240,237 million in November 2025, a decline of approximately 23.4%[32]. - Long-term debt increased significantly from $21,717 million in February 2025 to $3,815 million in November 2025, indicating a reduction in leverage[33]. - Total current liabilities remained relatively stable at $39,541 million in November 2025 compared to $39,974 million in February 2025[33].