Bassett(BSET) - 2021 Q4 - Annual Report

Financial Performance - Total net sales revenue for fiscal 2021 increased by $100,671, or 26.1%, compared to the prior year, primarily due to a strong recovery in demand for home furnishings following the COVID-19 pandemic [132]. - The company reported total net sales of $486,534 for fiscal 2021, with furniture and accessories contributing $430,886, and logistics services generating $55,648 [131]. - Total sales revenue for the fiscal year ended November 27, 2021, was $486.534 million, a significant increase from $385.863 million in 2020, representing a growth of approximately 26.1% [141]. - Net sales for the fiscal year ended November 27, 2021, increased by $74,254, or 33.6%, compared to the prior year, primarily due to a strong recovery in demand for home furnishings following the COVID-19 pandemic [160]. - Net sales for fiscal 2021 increased by $35,886 or 16.9% compared to fiscal 2020, primarily due to a strong recovery in demand for home furnishings following COVID-19 disruptions [166]. Segment Performance - Sales of furniture and accessories for fiscal 2021 increased by $34,447, or 7.6%, over fiscal 2019, driven by strong demand and growth in the wholesale business [132]. - The wholesale segment generated sales revenue of $295.329 million, while the retail segment contributed $247.827 million for the fiscal year ended November 27, 2021 [141]. - Retail segment net sales were $247,827 for the fiscal year ended November 27, 2021, a 16.9% increase from the previous year, but a 7.8% decrease compared to fiscal 2019 [163]. - The logistics segment reported revenue of $55.648 million for the fiscal year ended November 27, 2021, up from $48.191 million in 2020 [141]. - Shipments to the open market increased by 41% for fiscal 2021 over fiscal 2019, driven by growth from existing dealers and an expanded dealer base [161]. Cost and Expenses - Cost of furniture and accessories sold as a percentage of total revenue for fiscal 2021 was 43.1%, an increase from 42.4% in 2020, primarily due to rising raw material and freight costs [133]. - SG&A expenses as a percentage of sales for fiscal 2021 decreased to 40.5% from 45.7% in 2020, reflecting improved leverage on fixed costs due to higher sales volume [133]. - SG&A expenses totaled $196.831 million for the fiscal year ended November 27, 2021, compared to $176.368 million in 2020, indicating a rise of approximately 11.6% [141]. - SG&A expenses for the wholesale segment increased by $12,307, or 19.4%, compared to the prior year, but as a percentage of sales, it decreased from 28.7% to 25.7% [155]. Operational Metrics - Income from operations for the consolidated entity was $25.999 million for the fiscal year ended November 27, 2021, compared to a loss of $1.018 million in 2020 [144]. - The cost of furniture and accessories sold was $209.799 million for the fiscal year ended November 27, 2021, reflecting an increase from $163.567 million in 2020 [141]. - Gross profit for the wholesale segment was $93,303, representing a 37.0% increase from the previous year, with gross margins improving due to better leverage on fixed costs [155]. - The retail segment reported a gross profit of $129,372, which is a 23.6% increase from the previous year, with gross profit margin improving to 52.2% [163]. - Loss from operations in the retail segment improved to $7,044, compared to a loss of $9,497 in the previous year, indicating a significant operational recovery [163]. Challenges and Risks - The company faced ongoing logistical challenges due to COVID-related labor shortages and supply chain disruptions, impacting order fulfillment and increasing backlogs [160]. - The wholesale backlog reached $90,057 as of November 27, 2021, up from $54,874 at November 28, 2020, indicating ongoing supply chain disruptions and increased demand [160]. - The company is exposed to market risks from changes in raw material costs, particularly wood and foam products, and manages fuel price risks through surcharges [212]. Cash Flow and Investments - Cash provided by operations decreased to $14,563 in fiscal 2021, down $22,112 from $36,675 in fiscal 2020, primarily due to increased inventory investments [177]. - The overall cash position decreased by $11,425 during fiscal 2021, contrasting with an increase of $26,112 in fiscal 2020 [178]. - Net cash used in investing activities increased to $11,571 in fiscal 2021, up $7,824 from the previous year, due to higher capital expenditures [178]. - Anticipated capital expenditures for fiscal 2022 are projected to be between $25 million and $30 million, with approximately half allocated for a new retail store and renovations [187]. Shareholder Returns - Total dividends declared and paid in fiscal 2021 amounted to $5,210, or $0.53 per share, along with a special dividend of $2,479, or $0.25 per share [186]. - The company repurchased 204,714 shares for $5,566, with a weighted-average effect on earnings per share of approximately $0.02 [186]. Assets and Liabilities - The company had $52,089 in cash and cash equivalents as of November 27, 2021, indicating sufficient liquidity for future operations [178]. - The company has net deferred tax assets of $3,189, which are expected to reduce future cash outlays for income taxes [175]. - The allowance for credit losses was $796, representing 2.7% of gross accounts receivable as of November 27, 2021, down from 5.1% the previous year [199]. - Reserves for excess and obsolete inventory were $4,816, representing 5.8% of inventories on a LIFO basis as of November 27, 2021 [200]. - The company has guaranteed lease obligations totaling $1,845 million and $1,811 million as of November 27, 2021, and November 28, 2020, respectively [214].