[Havertys Furniture Q2 2025 Earnings Release](index=1&type=section&id=Havertys%20Furniture%20Q2%202025%20Earnings%20Release) [Operating Results Highlights](index=1&type=section&id=Operating%20Results%20Highlights) 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](index=2&type=chunk) 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](index=2&type=section&id=Financial%20Performance%20Analysis) 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](index=2&type=section&id=Second%20Quarter%202025%20vs.%20Second%20Quarter%202024) 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](index=7&type=chunk) - **SG&A expenses increased by $4.2 million**, driven by higher administrative, occupancy, and advertising costs[7](index=7&type=chunk) [Balance Sheet and Cash Flow](index=2&type=section&id=Balance%20Sheet%20and%20Cash%20Flow) 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](index=7&type=chunk) 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](index=2&type=section&id=2025%20Outlook%20and%20Guidance) 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](index=7&type=chunk) 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](index=3&type=section&id=Consolidated%20Financial%20Statements) Unaudited condensed financial statements provide a quantitative view of the company's performance and position [Condensed Consolidated Statements of Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) 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](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) 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](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) 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](index=8&type=section&id=Supplemental%20Information) Additional context includes non-GAAP reconciliations, metric definitions, and investor information [GAAP to Non-GAAP Reconciliation](index=8&type=section&id=GAAP%20to%20Non-GAAP%20Reconciliation) 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](index=8&type=section&id=Definitions%20and%20Classifications) 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](index=16&type=chunk) - 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](index=17&type=chunk) - SG&A expenses are classified as **variable** (selling, delivery) and **fixed/discretionary** (rent, advertising, administrative)[18](index=18&type=chunk) [Company and Investor Information](index=8&type=section&id=Company%20and%20Investor%20Information) 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](index=19&type=chunk) - Havertys, established in 1885, is a full-service home furnishings retailer with **129 showrooms in 17 states**[20](index=20&type=chunk) - The release contains **forward-looking statements** subject to the safe harbor provisions, which involve risks and uncertainties[21](index=21&type=chunk)[24](index=24&type=chunk)

[Executive Summary](index=1&type=section&id=Executive%20Summary) Havertys Furniture achieved its first year-over-year sales growth since Q4 2022, showing strong gross margins and improved operational trends [Second Quarter 2025 Highlights](index=1&type=section&id=Second%20Quarter%202025%20Highlights) Havertys Furniture reported its first year-over-year sales growth since Q4 2022, alongside strong gross margins and improved operational trends, despite a challenging market. Diluted EPS decreased, while consolidated sales increased slightly | Metric | Q2 2025 | Q2 2024 | Change | Chunk | | :-------------------------------- | :------ | :------ | :----- | :---- | | Diluted EPS | $0.16 | $0.27 | -40.7% | 3 | | Consolidated Sales | $181.0 million | $178.6 million | +1.3% | 3 | | Comparable Store Sales | -2.3% | N/A | N/A | 3 | | Gross Profit Margin | 60.8% | 60.4% | +0.4 percentage points | 3 | - Achieved year-over-year sales growth for the first time since **Q4 2022**, driven by new marketing and promotional strategies[2](index=2&type=chunk) - Experienced positive traffic trends and improved conversion rates[2](index=2&type=chunk) [CEO Commentary](index=1&type=section&id=CEO%20Commentary) President and CEO Steven G. Burdette highlighted the company's return to year-over-year sales growth in Q2 2025, attributing it to effective marketing, team dedication, and historical experience, despite ongoing challenges in the housing market and consumer confidence - CEO noted positive sales and operational trends, including strong gross margins, positive traffic, and improved conversion rates[2](index=2&type=chunk) - Acknowledged a challenging environment with a soft housing market, low consumer confidence, and tariff uncertainty[2](index=2&type=chunk) - Improved sales results are a reflection of new marketing and promotional strategies and the team's dedication[2](index=2&type=chunk) [Financial Performance Overview](index=2&type=section&id=Financial%20Performance%20Overview) Q2 2025 showed slight sales growth and improved gross margins, but increased SG&A expenses impacted net income for both the quarter and six-month period [Second Quarter 2025 Results of Operations](index=2&type=section&id=Second%20Quarter%202025%20Results%20of%20Operations) For the second quarter of 2025, consolidated sales increased by 1.3% to $181.0 million, while comparable store sales decreased by 2.3%. Gross profit margin improved to 60.8%, but SG&A expenses as a percentage of sales increased, leading to a decline in pre-tax and net income compared to the prior year | Metric | Q2 2025 | Q2 2024 | Change | Chunk | | :-------------------------------- | :------ | :------ | :----- | :---- | | Sales | $181.0 million | $178.6 million | +1.3% | 8 | | Gross Profit | $110.1 million | $108.0 million | +1.9% | 8 | | Gross Profit as % of Sales | 60.8% | 60.4% | +0.4 percentage points | 8 | | Total SG&A | $107.3 million | $103.1 million | +4.1% | 8 | | Total SG&A as % of Sales | 59.3% | 57.7% | +1.6 percentage points | 8 | | Pre-tax Income | $4.3 million | $6.5 million | -33.8% | 8 | | Net Income | $2.7 million | $4.4 million | -38.6% | 8 | | Diluted EPS | $0.16 | $0.27 | -40.7% | 8 | - Total written business increased **0.4%**, while comparable store written business decreased **2.1%**[7](index=7&type=chunk) - SG&A expenses increased by **$4.2 million**, primarily due to higher administrative expenses (**$3.4 million**), occupancy costs (**$1.5 million**), and advertising costs (**$1.1 million**), partially offset by lower warehouse and delivery costs (**$1.1 million**)[7](index=7&type=chunk) [Six Months Ended June 30, 2025 Results of Operations](index=2&type=section&id=Six%20Months%20Ended%20June%2030%2C%202025%20Results%20of%20Operations) For the first six months of 2025, total sales remained flat at $362.6 million compared to the prior year. Gross profit increased slightly, but higher SG&A expenses led to flat pre-tax income and a modest decrease in net income and diluted EPS | Metric | H1 2025 | H1 2024 | Change | Chunk | | :-------------------------------- | :------ | :------ | :----- | :---- | | Sales | $362.6 million | $362.6 million | 0.0% | 8 | | Gross Profit | $221.2 million | $219.0 million | +1.0% | 8 | | Gross Profit as % of Sales | 61.0% | 60.4% | +0.6 percentage points | 8 | | Total SG&A | $214.5 million | $212.5 million | +0.9% | 8 | | Total SG&A as % of Sales | 59.2% | 58.6% | +0.6 percentage points | 8 | | Pre-tax Income | $9.6 million | $9.6 million | 0.0% | 8 | | Net Income | $6.5 million | $6.8 million | -4.4% | 8 | | Diluted EPS | $0.39 | $0.41 | -4.9% | 8 | [Financial Statements](index=4&type=section&id=Financial%20Statements) Financial statements reflect slight Q2 2025 sales growth but decreased net income, flat six-month sales, and reduced cash flow primarily from inventory increases [Condensed Consolidated Statements of Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) The condensed consolidated statements of income show a slight increase in net sales for Q2 2025 but a decrease in net income due to higher selling, general, and administrative expenses. For the six months, net sales were flat, and net income saw a minor decline | (In thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | :------------------------------- | | Net sales | $181,025 | $178,636 | $362,592 | $362,633 | | Gross profit | $110,102 | $107,984 | $221,185 | $219,003 | | Selling, general and administrative | $107,333 | $103,099 | $214,535 | $212,455 | | Income before income taxes | $4,326 | $6,453 | $9,619 | $9,648 | | Net income | $2,689 | $4,438 | $6,467 | $6,831 | | Diluted EPS (Common Stock) | $0.16 | $0.27 | $0.39 | $0.41 | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were $642.7 million, slightly down from December 31, 2024. Cash and cash equivalents decreased, while inventories increased. Total liabilities also saw a minor decrease, with stockholders' equity remaining relatively stable | (In thousands) | June 30, 2025 | December 31, 2024 | June 30, 2024 | | :----------------------------------- | :------------ | :---------------- | :------------ | | Total assets | $642,672 | $648,747 | $642,105 | | Cash and cash equivalents | $107,357 | $120,034 | $109,942 | | Inventories | $93,270 | $83,419 | $92,401 | | Total current assets | $236,148 | $238,896 | $240,410 | | Total liabilities | $337,801 | $341,186 | $335,007 | | Stockholders' equity | $304,871 | $307,561 | $307,098 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash provided by operating activities decreased to $13.4 million from $17.5 million in the prior year, primarily due to an increase in inventories and a decrease in customer deposits. The company invested $11.7 million in capital expenditures and used $14.2 million in financing activities, including dividends and share repurchases | (In thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 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) | | Decrease in cash, cash equivalents, and restricted cash equivalents | $(12,543) | $(11,710) | | Cash, cash equivalents, and restricted cash equivalents at end of period | $113,771 | $116,067 | - Operating cash flow was impacted by a **$9.9 million** increase in inventories and a **$1.4 million** decrease in customer deposits[7](index=7&type=chunk) - Purchased approximately **94,000** shares of common stock for **$2.0 million** and paid **$10.4 million** in quarterly cash dividends[7](index=7&type=chunk) [Key Financial and Operational Metrics](index=3&type=section&id=Key%20Financial%20and%20Operational%20Metrics) Key metrics for H1 2025 indicate increased EBITDA and free cash flow, supported by a strong liquidity position with substantial cash and no outstanding debt [Other Financial and Operations Data](index=3&type=section&id=Other%20Financial%20and%20Operations%20Data) For the six months ended June 30, 2025, EBITDA increased to $18.7 million. Sales per square foot slightly decreased, while the average ticket value saw a modest increase | Metric | H1 2025 | H1 2024 | Change | Chunk | | :---------------- | :------ | :------ | :----- | :---- | | EBITDA (in millions) | $18.7 | $16.8 | +11.3% | 9 | | Sales per square foot | $161 | $166 | -3.0% | 9 | | Average ticket | $3,350 | $3,332 | +0.5% | 9 | - Design consultants accounted for **33.4%** of written business in **2025**, down from **36.0%** in **2024**[7](index=7&type=chunk) [Liquidity Measures](index=3&type=section&id=Liquidity%20Measures) Free cash flow for the six months ended June 30, 2025, was $1.7 million, a slight increase from the prior year. The company maintained a strong liquidity position with $113.8 million in cash and no outstanding debt, alongside $80.0 million in credit availability | Metric | H1 2025 | H1 2024 | Change | Chunk | | :-------------------------- | :------ | :------ | :----- | :---- | | Operating cash flow | $13.4 million | $17.5 million | -23.5% | 10 | | Capital expenditures | $(11.7 million) | $(16.0 million) | +26.9% | 10 | | Free cash flow | $1.7 million | $1.5 million | +13.3% | 10 | | Cash at period end | $113.8 million | $116.1 million | -2.0% | 10 | | Share repurchases | $2.0 million | $0 | N/A | 10 | | Dividends | $10.4 million | $10.1 million | +3.0% | 10 | - No debt outstanding at **June 30, 2025**, with **$80.0 million** in credit availability[7](index=7&type=chunk) [Outlook and Guidance](index=2&type=section&id=Outlook%20and%20Guidance) Havertys Furniture's 2025 guidance remains largely consistent with prior expectations, including gross profit margins between 60.0% to 60.5% and fixed/discretionary SG&A expenses in the $291.0 to $293.0 million range. Variable SG&A is anticipated to decrease, and planned capital expenditures are approximately $24.0 million - **2025** guidance includes currently effective tariffs but excludes effects of additional proposed tariffs[7](index=7&type=chunk) - Gross profit margins for **2025** are expected to be between **60.0%** to **60.5%**, unchanged from prior guidance[7](index=7&type=chunk) - Fixed and discretionary SG&A expenses for **2025** are expected to be in the **$291.0** to **$293.0 million** range (unchanged), while variable SG&A expenses are anticipated to be **18.5%** to **18.8%** (a decrease from prior guidance due to lower warehouse and delivery costs)[7](index=7&type=chunk) - Effective tax rate for **2025** is expected to be **26.5%**, excluding discrete items and new tax legislation[7](index=7&type=chunk) - Planned capital expenditures for **2025** are approximately **$24.0 million**, with retail square footage expected to remain consistent with **2024**[7](index=7&type=chunk) [Non-GAAP Financial Measures and Definitions](index=8&type=section&id=Non-GAAP%20Financial%20Measures%20and%20Definitions) This section clarifies non-GAAP measures including EBITDA, comparable store sales, and the classification of cost of goods sold and SG&A expenses [GAAP to Non-GAAP Reconciliation (EBITDA)](index=8&type=section&id=GAAP%20to%20Non-GAAP%20Reconciliation%20(EBITDA)) The company provides EBITDA as a non-GAAP financial measure, believing it offers additional useful information for investors. EBITDA for the six months ended June 30, 2025, was $18.7 million, an increase from $16.8 million in the prior year - EBITDA is presented as a meaningful non-GAAP measure to supplement GAAP financial reporting[14](index=14&type=chunk) | (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 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 | [Comparable Store Sales Definition](index=8&type=section&id=Comparable%20Store%20Sales%20Definition) Comparable-store sales measure the performance of existing stores and the website by comparing sales growth for a particular month over the corresponding month in the prior year. Stores are excluded if they were not open during the corresponding month or if selling square footage changed significantly - Comparable-store sales indicate the performance of existing stores and the website[16](index=16&type=chunk) - Stores are considered non-comparable if not open during the corresponding month or if selling square footage changed significantly[16](index=16&type=chunk) [Cost of Goods Sold and SG&A Expense Classification](index=8&type=section&id=Cost%20of%20Goods%20Sold%20and%20SG%26A%20Expense%20Classification) Havertys includes most occupancy and home delivery costs, along with a portion of warehousing expenses, in SG&A, which may differ from other entities' classifications. SG&A expenses are further categorized into variable (selling and delivery costs) and fixed/discretionary (rent, depreciation, advertising, administrative costs) - Substantially all occupancy and home delivery costs, plus a portion of warehousing expenses, are included in SG&A expense[17](index=17&type=chunk) - SG&A expenses are classified as variable (selling and delivery costs) or fixed and discretionary (rent, depreciation, advertising, administrative costs)[18](index=18&type=chunk) - Variable selling expenses primarily include compensation for commission-based sales associates, third-party financing discounts, and credit card transaction fees[18](index=18&type=chunk) [Corporate Information](index=8&type=section&id=Corporate%20Information) This section outlines Havertys Furniture's corporate profile, Q2 2025 conference call details, and a safe harbor statement concerning forward-looking information [About Havertys Furniture](index=8&type=section&id=About%20Havertys%20Furniture) Haverty Furniture Companies, Inc., established in 1885, is a full-service home furnishings retailer operating 129 showrooms across 17 states in the Southern and Midwestern regions, offering a wide selection of quality merchandise in middle to upper-middle price ranges - Established in **1885**, Havertys is a full-service home furnishings retailer[20](index=20&type=chunk) - Operates **129** showrooms in **17** states across the Southern and Midwestern regions[20](index=20&type=chunk) - Provides a wide selection of quality merchandise in middle to upper-middle price ranges[20](index=20&type=chunk) [Conference Call Information](index=8&type=section&id=Conference%20Call%20Information) Havertys Furniture hosted a live webcast of its conference call on July 31, 2025, at 10:00 a.m. ET, with a replay available on its investor relations website - Live webcast of the conference call was held on **July 31, 2025**, at **10:00 a.m. ET**[19](index=19&type=chunk) - A replay was made available on the company's investor relations website (ir.havertys.com) at approximately **1:00 p.m. ET** on the same day[19](index=19&type=chunk) [Safe Harbor Statement](index=9&type=section&id=Safe%20Harbor%20Statement) This press release and the conference call contain forward-looking statements subject to safe harbor provisions, which involve risks and uncertainties that could cause actual results to differ materially from expectations. Investors are cautioned not to place undue reliance on these statements and to review subsequent SEC filings for further disclosures - The report contains forward-looking statements subject to safe harbor provisions of the Securities Act of **1933** and **1934**[21](index=21&type=chunk) - Forward-looking statements involve risks and uncertainties, and actual results may differ materially due to various factors, including competition, consumer preferences, supply chain risks, economic conditions, and regulatory changes[23](index=23&type=chunk) - The company undertakes no duty to update forward-looking statements except as required by law, advising investors to review subsequent SEC filings[24](index=24&type=chunk)

Core Viewpoint - Haverty Furniture Companies (HVT) is currently identified as a strong value stock, holding a Zacks Rank 2 (Buy) and an "A" grade in the Value category, indicating its potential for undervaluation in the market [4][8]. Valuation Metrics - HVT has a Forward P/E ratio of 10.98, significantly lower than the industry average of 20.76, with historical fluctuations between 9.18 and 23.87 over the past 12 months [4]. - The PEG ratio for HVT stands at 0.92, compared to the industry average of 2.34, indicating a favorable valuation relative to expected earnings growth [5]. - HVT's P/S ratio is 0.46, which is much lower than the industry average of 1.26, suggesting that the stock is undervalued based on sales performance [6]. - The P/CF ratio for HVT is 7.64, compared to the industry average of 13.84, reflecting a strong cash flow outlook and further supporting the undervaluation thesis [7]. Investment Outlook - The combination of HVT's strong earnings outlook and favorable valuation metrics positions it as one of the market's strongest value stocks, appealing to value investors [8].

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company's Q1 2025 financial statements reflect a **57.9% increase in net income** to **$3.8 million** despite a slight sales decrease, alongside improved operating cash flow [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets slightly decreased to **$642.7 million**, with a reduction in cash and a marginal decrease in stockholders' equity Balance Sheet Summary (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$642,690** | **$648,747** | | Cash and cash equivalents | $111,941 | $120,034 | | Inventories | $88,704 | $83,419 | | **Total Liabilities** | **$337,329** | **$341,186** | | **Total Stockholders' Equity** | **$305,361** | **$307,561** | [Condensed Consolidated Statements of Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) Q1 2025 net sales slightly decreased by **1.3%** to **$181.6 million**, but net income significantly increased by **57.9%** to **$3.8 million** Q1 2025 vs. Q1 2024 Income Statement (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $181,567 | $183,997 | -1.3% | | Gross Profit | $111,083 | $111,019 | +0.1% | | Income Before Income Taxes | $5,293 | $3,195 | +65.7% | | **Net Income** | **$3,778** | **$2,393** | **+57.9%** | | Diluted EPS (Common) | $0.23 | $0.14 | +64.3% | - Cash dividends per share for Common Stock increased to **$0.32** in Q1 2025 from **$0.30** in Q1 2024[10](index=10&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 net cash from operating activities increased to **$6.2 million**, while cash used in financing activities rose due to **$2.0 million** in stock repurchases Q1 2025 vs. Q1 2024 Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $6,154 | $3,135 | | Net cash used in investing activities | ($6,122) | ($6,351) | | Net cash used in financing activities | ($8,058) | ($6,698) | | **Decrease in cash** | **($8,026)** | **($9,914)** | - The company repurchased **$2.0 million** of common stock in Q1 2025, whereas no repurchases were made in Q1 2024[11](index=11&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail accounting policies, single reportable segment operations, **44.8%** of sales from upholstery, and an **$80.0 million** revolving credit facility with no outstanding borrowings Revenue by Product Category - Q1 2025 vs Q1 2024 (in thousands) | Category | Q1 2025 Net Sales | % of Sales | Q1 2024 Net Sales | % of Sales | | :--- | :--- | :--- | :--- | :--- | | Case Goods | $58,052 | 32.0% | $59,085 | 32.1% | | Upholstery | $81,415 | 44.8% | $82,935 | 45.1% | | Mattresses | $15,804 | 8.7% | $16,600 | 9.0% | | Accessories and Other | $26,296 | 14.5% | $25,377 | 13.8% | - The company operates as a single reportable segment, with financial and operational decisions made on a market area approach[23](index=23&type=chunk) - As of March 31, 2025, the company had full availability of **$80.0 million** under its revolving credit facility, with no outstanding borrowings[20](index=20&type=chunk)[55](index=55&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=16&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the **1.3%** Q1 2025 net sales decline to macroeconomic factors, while gross profit margin improved to **61.2%** and SG&A expenses decreased by **2.0%** [Net Sales](index=17&type=section&id=Net%20Sales) Q1 2025 net sales decreased by **1.3%** to **$181.6 million**, with comparable-store sales down **4.8%** due to macroeconomic factors, though in-home design services showed positive trends Q1 Sales Performance | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Sales | $181.6M (-1.3%) | $184.0M (-18.1%) | | Comp-Store Sales Change | -4.8% | -18.5% | - Written business for Q1 2025 was down **2.6%** compared to Q1 2024, with written comp-store sales down **6.3%**[47](index=47&type=chunk) - In-home design consultants drove **33.2%** of total written sales in Q1 2025, up from **32.4%** in Q1 2024, with the average ticket increasing from **$6,782** to **$7,422**[48](index=48&type=chunk) [Gross Profit](index=17&type=section&id=Gross%20Profit) Gross profit margin for Q1 2025 improved by **90 basis points** to **61.2%**, driven by favorable product selection and merchandising mix - Gross profit margin increased to **61.2%** in Q1 2025 from **60.3%** in Q1 2024, a **90 basis point** improvement[49](index=49&type=chunk) [Selling, General and Administrative Expenses](index=17&type=section&id=Selling%2C%20General%20and%20Administrative%20Expenses) Q1 2025 SG&A expenses decreased by **$2.2 million** (**2.0%**) to **$107.2 million**, improving to **59.0%** of sales due to lower variable costs SG&A Expense Breakdown (in thousands) | Expense Type | Q1 2025 | % of Sales | Q1 2024 | % of Sales | | :--- | :--- | :--- | :--- | :--- | | Variable | $33,647 | 18.5% | $36,986 | 20.1% | | Fixed and discretionary | $73,555 | 40.5% | $72,370 | 39.3% | | **Total SG&A** | **$107,202** | **59.0%** | **$109,356** | **59.4%** | [Liquidity and Capital Resources](index=18&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$111.9 million** in cash and full availability of its **$80.0 million** credit facility, with operating cash flow improving to **$6.2 million** - At March 31, 2025, the company had **$111.9 million** in cash and cash equivalents and **$6.3 million** in restricted cash[54](index=54&type=chunk) - Net cash provided by operating activities increased to **$6.2 million** in Q1 2025 from **$3.1 million** in Q1 2024[59](index=59&type=chunk) - Cash used in financing activities increased by **$1.4 million** YoY, primarily due to **$2.0 million** in common stock repurchases in Q1 2025[61](index=61&type=chunk) [Store Plans and Capital Expenditures](index=19&type=section&id=Store%20Plans%20and%20Capital%20Expenditures) The company is managing its store portfolio with planned openings and closures, while re-evaluating 2025 store plans and capital expenditures due to potential tariff impacts 2025 Store Activity Plan | Location or Market | Planned Quarter | Activity | | :--- | :--- | :--- | | Houston, TX | Q1-25 | Open | | Daytona, FL | Q2-25 | Relocation | | Atlanta, GA | Q2-25 | Closure | | Waco, TX | Q3-25 | Closure | | Houston, TX | Q3-25 | Open | - The company is re-evaluating its store plans and capital expenditures for 2025 to minimize the impact of increased tariffs[62](index=62&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=19&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company reports no material changes to its market risk exposure since the end of fiscal year 2024 - There has been no material change in the company's market risk exposure since December 31, 2024[64](index=64&type=chunk) [Item 4. Controls and Procedures](index=19&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting - Management concluded that disclosure controls and procedures were effective as of the end of the reporting period[65](index=65&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal controls[66](index=66&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=20&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no pending legal proceedings expected to have a material adverse effect on its financial condition or operations - The company is subject to various claims in the ordinary course of business but currently has no pending legal proceedings expected to have a material adverse effect[40](index=40&type=chunk)[68](index=68&type=chunk) [Item 1A. Risk Factors](index=20&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred from the risk factors previously disclosed in the company's Annual Report on Form 10-K - No material changes from the risk factors described in the company's Form 10-K have occurred[69](index=69&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=20&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) In Q1 2025, the company repurchased **93,741** common shares for approximately **$2.0 million**, with **$6.1 million** remaining under the repurchase program Q1 2025 Share Repurchase Activity | Period | Total Shares Purchased | Average Price Paid Per Share | Approx. Value Remaining for Repurchase | | :--- | :--- | :--- | :--- | | Jan 2025 | 0 | $— | $8,121,000 | | Feb 2025 | 0 | $— | $8,121,000 | | Mar 2025 | 93,741 | $21.34 | $6,121,000 | [Item 5. Other Information](index=20&type=section&id=Item%205.%20Other%20Information) No directors or officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q1 2025 - No directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement in Q1 2025[72](index=72&type=chunk) [Item 6. Exhibits](index=21&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with Form 10-Q, including CEO and CFO certifications and financial statements in inline XBRL format - Key exhibits filed include CEO and CFO certifications (Exhibits 31.1, 31.2, 32.1) and financial data in inline XBRL format (Exhibit 101)[74](index=74&type=chunk)

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the company's unaudited condensed consolidated financial statements and accompanying notes for the relevant periods [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) | (In thousands) | March 31, 2025 | December 31, 2024 | | :--------------- | :------------- | :---------------- | | Total assets | $642,690 | $648,747 | | Total liabilities | $337,329 | $341,186 | | Total stockholders' equity | $305,361 | $307,561 | | Cash and cash equivalents | $111,941 | $120,034 | | Inventories | $88,704 | $83,419 | [Condensed Consolidated Statements of Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) | (In thousands, except per share data) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------------------------------ | :-------------------------------- | :-------------------------------- | | Net sales | $181,567 | $183,997 | | Gross profit | $111,083 | $111,019 | | Income before income taxes | $5,293 | $3,195 | | Net income | $3,778 | $2,393 | | Basic earnings per share: Common Stock | $0.24 | $0.15 | | Cash dividends per share: Common Stock | $0.32 | $0.30 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) | (In thousands) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------- | :-------------------------------- | :-------------------------------- | | Net cash provided by operating activities | $6,154 | $3,135 | | Net cash used in investing activities | $(6,122) | $(6,351) | | Net cash used in financing activities | $(8,058) | $(6,698) | | Common stock repurchased | $(2,000) | — | | Dividends paid | $(5,173) | $(4,845) | [Notes to Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [Note A - Business and Basis of Presentation](index=7&type=section&id=Note%20A%20-%20Business%20and%20Basis%20of%20Presentation) - Haverty Furniture Companies, Inc operates as a retailer of residential furniture in the middle to upper-middle price ranges, exclusively under the Havertys brand without franchising[12](index=12&type=chunk) - The unaudited condensed consolidated financial statements are prepared in accordance with Form 10-Q instructions and rely on management's estimates and assumptions, which may differ from actual results[12](index=12&type=chunk)[13](index=13&type=chunk) [Note B – Stockholders' Equity](index=8&type=section&id=Note%20B%20%E2%80%93%20Stockholders%27%20Equity) | (in thousands) | Balances at Dec 31, 2024 | Net income | Dividends declared (Common Stock) | Dividends declared (Class A Common Stock) | Acquisition of treasury stock | Balances at Mar 31, 2025 | | :------------- | :----------------------- | :--------- | :-------------------------------- | :---------------------------------------- | :---------------------------- | :----------------------- | | Total Stockholders' Equity | $307,561 | $3,778 | $(4,799) | $(374) | $(2,000) | $305,361 | [Note C – Interim LIFO Calculations](index=10&type=section&id=Note%20C%20%E2%80%93%20Interim%20LIFO%20Calculations) - Inventories are valued using the last-in, first-out (LIFO) method with an annual LIFO index[17](index=17&type=chunk) - Interim LIFO calculations are based on management's estimates of year-end inventory levels and expected inflation/deflation rates, making interim results subject to change based on the final year-end valuation[17](index=17&type=chunk) [Note D – Fair Value of Financial Instruments](index=10&type=section&id=Note%20D%20%E2%80%93%20Fair%20Value%20of%20Financial%20Instruments) - The fair values of cash, restricted cash, accounts payable, and customer deposits approximate their carrying values due to their short-term nature[18](index=18&type=chunk) - Assets related to self-directed, non-qualified deferred compensation plans are valued using **Level 1 quoted market prices**[18](index=18&type=chunk) [Note E – Credit Agreement](index=10&type=section&id=Note%20E%20%E2%80%93%20Credit%20Agreement) - The company has an **$80.0 million revolving credit facility**, secured primarily by inventory, maturing on October 24, 2027[19](index=19&type=chunk) - As of March 31, 2025, and December 31, 2024, there were **no outstanding borrowings** under the Credit Agreement, with a net availability of **$80.0 million** at March 31, 2025[20](index=20&type=chunk) [Note F – Revenues and Segment Reporting](index=10&type=section&id=Note%20F%20%E2%80%93%20Revenues%20and%20Segment%20Reporting) - Revenue from merchandise sales and related service fees is recognized upon delivery to the customer[21](index=21&type=chunk) - The company operates within a **single reportable segment**, with an executive committee serving as the chief operating decision maker (CODM) and evaluating performance based on income before income taxes[23](index=23&type=chunk)[24](index=24&type=chunk) | (In thousands) | Net Sales (2025) | % of Net Sales (2025) | Net Sales (2024) | % of Net Sales (2024) | | :------------- | :--------------- | :-------------------- | :--------------- | :-------------------- | | Case Goods | $58,052 | 32.0 % | $59,085 | 32.1 % | | Upholstery | $81,415 | 44.8 % | $82,935 | 45.1 % | | Mattresses | $15,804 | 8.7 % | $16,600 | 9.0 % | | Accessories and Other | $26,296 | 14.5 % | $25,377 | 13.8 % | | Total | $181,567 | 100.0 % | $183,997 | 100.0 % | [Note G – Leases](index=11&type=section&id=Note%20G%20%E2%80%93%20Leases) - The company holds operating leases for retail stores, offices, warehouses, and equipment, with remaining terms of **1 to 12 years** and options to extend up to 20 years[27](index=27&type=chunk) - Variable lease payments, based on sales volume or asset usage, are not included in the initial measurement of lease liabilities and are recorded as lease expense in the period incurred[28](index=28&type=chunk)[29](index=29&type=chunk) | (in thousands) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :------------- | :-------------------------------- | :-------------------------------- | | Operating lease cost | $12,334 | $12,244 | | Variable lease cost | $1,302 | $1,374 | | Total lease expense | $13,636 | $13,618 | [Note H – Income Taxes](index=12&type=section&id=Note%20H%20%E2%80%93%20Income%20Taxes) - The effective tax rate for the three months ended March 31, 2025, was **28.6%**, an increase from **25.1%** in the prior year, primarily due to nondeductible items and state income taxes[31](index=31&type=chunk) [Note I – Stock-Based Compensation Plans](index=13&type=section&id=Note%20I%20%E2%80%93%20Stock-Based%20Compensation%20Plans) - Total compensation cost related to unvested equity awards was approximately **$11.9 million** as of March 31, 2025, expected to be recognized over a weighted-average period of two years[35](index=35&type=chunk) - Compensation charged to selling, general and administrative expenses was approximately **$2.1 million for Q1 2025**, down from **$2.6 million for Q1 2024**[35](index=35&type=chunk) - The total fair value of performance-based restricted stock awards that vested during Q1 2025 was approximately **$2.1 million**[34](index=34&type=chunk) [Note J – Earnings Per Share](index=14&type=section&id=Note%20J%20%E2%80%93%20Earnings%20Per%20Share) - The company reports earnings per share using the **two-class method**, reflecting Common Stock's preferential dividend rate and Class A Common Stock's greater voting rights[37](index=37&type=chunk)[38](index=38&type=chunk) | Earnings Per Share | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :----------------- | :-------------------------------- | :-------------------------------- | | Basic EPS: Common Stock | $0.24 | $0.15 | | Diluted EPS: Common Stock | $0.23 | $0.14 | [Note K – Contingencies](index=15&type=section&id=Note%20K%20%E2%80%93%20Contingencies) - The company is subject to various claims and legal proceedings in the ordinary course of business, but currently has **no pending claims reasonably likely to have a material adverse effect** on its financial condition, results of operations, or cash flows[40](index=40&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=16&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, operational trends, liquidity, and capital resources for the first quarter of 2025 [Forward-Looking Statements](index=16&type=section&id=Forward-Looking%20Statements) - Statements in the report that are not purely historical facts or depend on future events are considered forward-looking statements, subject to risks and uncertainties[42](index=42&type=chunk) - Readers are cautioned not to place undue reliance on forward-looking statements, as actual results could differ materially due to factors like competition, consumer preferences, supply chain issues, and economic conditions[42](index=42&type=chunk) [Impact of tariffs imposed by the U.S government](index=16&type=section&id=Impact%20of%20tariffs%20imposed%20by%20the%20U.S%20government) - The U.S government imposed additional tariffs on imported goods starting in Q1 2025, with a **90-day pause** for most trading partners (excluding China) implemented in April 2025[44](index=44&type=chunk) - The company is actively monitoring negotiations and evaluating the impact of these tariffs to minimize their effect on its business[44](index=44&type=chunk) [Net Sales](index=17&type=section&id=Net%20Sales) - Net sales decreased by **$2.4 million (1.3%)** and comparable-store sales decreased by **$8.8 million (4.8%)** in Q1 2025 compared to Q1 2024, attributed to a weak housing market, inflationary pressures, cautious consumer spending, and atypical winter weather[47](index=47&type=chunk) - Design consultants drove **33.2% of total written sales** in Q1 2025, with an average written ticket of **$7,422**, an increase from 32.4% and $6,782 in Q1 2024[48](index=48&type=chunk) | Period | Net Sales Total $ (2025) | % Change (2025) | Comp-Store Sales % Change (2025) | Net Sales Total $ (2024) | % Change (2024) | Comp-Store Sales % Change (2024) | | :----- | :----------------------- | :-------------- | :------------------------------- | :----------------------- | :-------------- | :------------------------------- | | Q1 | $181.6 | (1.3)% | (4.8)% | $184.0 | (18.1)% | (18.5)% | [Gross Profit](index=17&type=section&id=Gross%20Profit) - Gross profit margin for Q1 2025 increased by **90 basis points to 61.2%** compared to 60.3% in the prior year, primarily due to product selection and merchandising mix[49](index=49&type=chunk) [Selling, General and Administrative Expenses](index=17&type=section&id=Selling%2C%20General%20and%20Administrative%20Expenses) - SG&A costs as a percentage of sales decreased to **59.0% in Q1 2025** from 59.4% in Q1 2024, with total SG&A dollars decreasing by **$2.2 million (2.0%)**[50](index=50&type=chunk) - The decrease in SG&A dollars was driven by lower selling expense ($2.0 million), warehouse and delivery costs ($1.7 million), and advertising and marketing costs ($1.1 million), partially offset by higher occupancy costs ($1.6 million) and administrative expenses ($1.0 million)[50](index=50&type=chunk) | (In thousands) | 2025 $ | % of Net Sales (2025) | 2024 $ | % of Net Sales (2024) | | :------------- | :----- | :-------------------- | :----- | :-------------------- | | Variable | $33,647 | 18.5 % | $36,986 | 20.1 % | | Fixed and discretionary | $73,555 | 40.5 % | $72,370 | 39.3 % | | Total | $107,202 | 59.0 % | $109,356 | 59.4 % | [Liquidity and Capital Resources](index=18&type=section&id=Liquidity%20and%20Capital%20Resources) - The company believes its current cash position, cash flow from operations, available credit, and access to debt capital markets are sufficient for operating requirements, capital expenditures, dividend payments, and lease obligations for the next several years[54](index=54&type=chunk) [Cash and Cash Equivalents](index=18&type=section&id=Cash%20and%20Cash%20Equivalents) - As of March 31, 2025, the company had **$111.9 million in cash and cash equivalents** and $6.3 million in restricted cash equivalents[54](index=54&type=chunk) [Long-Term Debt](index=18&type=section&id=Long-Term%20Debt) - The company maintains an **$80.0 million revolving credit facility**, maturing October 24, 2027, with **no outstanding borrowings** and $80.0 million net availability as of March 31, 2025[55](index=55&type=chunk) [Leases](index=18&type=section&id=Leases) - The company leases a portion of its real estate, including stores, distribution centers, and store support space, through operating leases[56](index=56&type=chunk) [Cash Flows Summary](index=18&type=section&id=Cash%20Flows%20Summary) - Net cash provided by operating activities increased to **$6.2 million in Q1 2025** from $3.1 million in Q1 2024, driven by higher net income and changes in working capital, including increased inventories[59](index=59&type=chunk) - Cash used in investing activities decreased by **$0.2 million** in Q1 2025 due to lower capital expenditures[60](index=60&type=chunk) - Cash used in financing activities increased by **$1.4 million** in Q1 2025, primarily due to **$2.0 million in common stock repurchases** (compared to none in Q1 2024)[61](index=61&type=chunk) [Store Plans and Capital Expenditures](index=19&type=section&id=Store%20Plans%20and%20Capital%20Expenditures) - The company is reevaluating its store plans and capital expenditures for 2025 to minimize the impact of increased tariffs[62](index=62&type=chunk) - Assuming new stores open as planned, the company expects to end 2025 with **129 stores**, including planned openings in Houston (Q1, Q3 2025) and a relocation in Daytona (Q2 2025), alongside closures in Atlanta (Q2 2025) and Waco (Q3 2025)[62](index=62&type=chunk) [Critical Accounting Estimates](index=19&type=section&id=Critical%20Accounting%20Estimates) - Critical accounting estimates involve significant, subjective, or complex judgments due to inherent uncertainties, but **no significant changes were identified** since the last annual report[63](index=63&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=19&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section confirms no material changes in market risk exposure since the year-end 2024 report - The company's exposure to market risk has **not materially changed** since December 31, 2024[64](index=64&type=chunk) [Item 4. Controls and Procedures](index=19&type=section&id=Item%204.%20Controls%20and%20Procedures) Management confirms the effectiveness of disclosure controls and procedures as of March 31, 2025, with no material changes to internal controls - Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were **effective as of March 31, 2025**[65](index=65&type=chunk) - **No material changes** in the company's internal control over financial reporting were identified during the fiscal quarter ended March 31, 2025[66](index=66&type=chunk) [PART II. OTHER INFORMATION](index=20&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=20&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to the financial statement notes for information on legal proceedings, with no material adverse effects anticipated - Information regarding legal proceedings is described in Note A of the Notes to the Condensed Consolidated Financial Statements[68](index=68&type=chunk) [Item 1A. Risk Factors](index=20&type=section&id=Item%201A.%20Risk%20Factors) This section confirms no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K - There have been **no material changes** from the risk factors described in the company's 2024 Annual Report on Form 10-K[69](index=69&type=chunk) [Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=20&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company details its Q1 2025 common stock repurchases and the remaining authorization under its buyback program - The board of directors has authorized a stock repurchase program with **no expiration date**[70](index=70&type=chunk) | Period | Total Number of Shares Purchased | Average Price Paid Per Share | Approximate Dollar Value of Shares That May Yet be Purchased | | :----- | :------------------------------- | :--------------------------- | :----------------------------------------------------------- | | March 1 - March 31 | 93,741 | $21.34 | $6,121,000 | | Total | 93,741 | | | [Item 5. Other Information](index=20&type=section&id=Item%205.%20Other%20Information) This section confirms no directors or officers adopted, modified, or terminated any Rule 10b5-1 trading arrangements during Q1 2025 - **No directors or officers** adopted, modified, or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the three months ended March 31, 2025[72](index=72&type=chunk) [Item 6. Exhibits](index=21&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the report, including CEO/CFO certifications and XBRL-formatted financial statements - Exhibits include certifications of the Chief Executive Officer and Chief Financial Officer (31.1, 31.2, 32.1) and financial statements formatted in inline XBRL (101)[74](index=74&type=chunk) [SIGNATURES](index=22&type=section&id=SIGNATURES) - The report was signed on May 2, 2025, by Steven G Burdette, President, Chief Executive Officer, and Director, and Richard B Hare, Executive Vice President, Chief Financial Officer, and Corporate Secretary[80](index=80&type=chunk)

Financial Data and Key Metrics Changes - Q1 2025 sales were $181.6 million, a decrease of 1.3% year-over-year, with comparable store sales down 4.8% [3][18] - Gross margins increased to 61.2% from 60.3%, reflecting improved product selection and merchandise mix [4][18] - Pre-tax profits rose to $5.3 million, with an operating margin of 2.9%, compared to $3.2 million and 1.7% in Q1 2024 [4][19] - Net income for Q1 2025 was $3.8 million, or $0.23 per diluted share, compared to $2.4 million, or $0.14 per share in the same quarter last year [19] Business Line Data and Key Metrics Changes - The design business accounted for approximately 33% of total business, with an average ticket of over $3,300, up about 4% [6] - The designer average ticket grew to over $7,400, an increase of over 9% [6] - Weakness was noted in dining and occasional categories, while upholstery, bedroom, and mattress categories performed in line with expectations [6] Market Data and Key Metrics Changes - Written sales were down 2.6% with comparable sales down 6.3% [3] - Sales for Presidents' Day were disappointing, down roughly 10% over the two-week period [5] - Traffic softened but remained positive in the low single digits, with conversion rates stabilizing and showing some improvement compared to last year [5] Company Strategy and Development Direction - The company plans to roll out a new point of purchase and tagging program to enhance the in-store customer experience [7] - The strategy includes increasing inventories of best-selling products to mitigate supply chain disruptions due to tariffs [11][12] - The company aims to open five new stores annually, with a cautious approach based on current market conditions [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed satisfaction with Q1 results despite challenges such as housing market lows, high interest rates, and declining consumer confidence [4][16] - The company is well-positioned to navigate challenges due to its strong brand, debt-free balance sheet, and customer focus [17] - Future guidance includes expectations for gross margins between 60% and 60.5% for 2025, factoring in current tariffs [21][22] Other Important Information - Inventory levels increased by approximately $5 million or about 6% since year-end 2024 [11] - The company has no funded debt and ended Q1 with $111.9 million in cash and cash equivalents [20] - CapEx for Q1 2025 was $6.1 million, with a planned reduction to $24 million for the year due to tariff uncertainties [22] Q&A Session Summary Question: Impact of winter storms on business - Management noted that January was down almost 2% in written business, February down about 5%, and March was flat, with multiple storms impacting operations [26][27][28] Question: Price increases due to tariffs - Management confirmed targeted price increases will be implemented, but they expect minimal impact on consumers due to supplier cooperation [31][32] Question: Changes in competition - Management observed aggressive promotions from competitors but did not believe promotional activity was the primary issue affecting sales [34][35] Question: Reduction in CapEx guidance - Management explained the $3 million reduction in CapEx was due to tariff uncertainties, leading to a cautious approach on store expansion [36][37] Question: Performance of new stores - Management expressed satisfaction with new store performance, noting they leverage existing distribution networks and initial traffic has been good [47][48]

Financial Data and Key Metrics Changes - Q1 2025 sales were $181.6 million, a decrease of 1.3% year-over-year, with comparable store sales down 4.8% [3][18] - Gross margins increased to 61.2% from 60.3%, reflecting improved product selection and merchandise mix [4][18] - Pre-tax profits rose to $5.3 million, with an operating margin of 2.9%, compared to $3.2 million and 1.7% in Q1 2024 [4][19] - Net income for Q1 2025 was $3.8 million, or $0.23 per diluted share, compared to $2.4 million, or $0.14 per share, in the same quarter last year [19] Business Line Data and Key Metrics Changes - The design business accounted for approximately 33% of total business, with an average ticket of over $3,300, up about 4% [6] - The designer average ticket grew to over $7,400, an increase of over 9% [6] - Weakness was noted in dining and occasional categories, while upholstery, bedroom, and mattress categories performed in line with expectations [6] Market Data and Key Metrics Changes - Written sales were down 2.6% with comparable sales down 6.3% [3] - Sales for the Presidents' Day event were disappointing, down roughly 10% over the two-week period [5] - Traffic softened but remained positive in the low single digits, with conversion rates stabilizing and showing some improvement compared to last year [5] Company Strategy and Development Direction - The company plans to roll out a new point of purchase and tagging program to enhance the in-store customer experience [7] - The strategy includes increasing inventories of best-selling products to improve service speed and mitigate tariff impacts [11][12] - The company aims to open five new stores annually, with a cautious approach due to current market conditions [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed satisfaction with Q1 results despite challenges from the housing market, high interest rates, and consumer confidence issues [4][16] - The company is well-positioned to navigate challenges due to its strong brand, debt-free balance sheet, and customer focus [17] - Future guidance includes expectations for gross margins between 60% and 60.5% for 2025, factoring in current tariffs [21][22] Other Important Information - SG&A expenses decreased by $2.2 million or 1.9% to $107.2 million, representing 59% of sales [19] - Inventory levels increased by approximately $5 million or about 6% since year-end 2024 [11][20] - The company has halted most direct shipments from China due to tariffs, which could cause temporary supply disruptions [10] Q&A Session Summary Question: Impact of winter storms on business - Management noted that January was down almost 2% in written business, February down about 5%, and March was flat, with multiple storms impacting operations [26][27][28] Question: Price increases due to tariffs - Management confirmed targeted price increases will be implemented, but they expect minimal impact on consumers due to supplier cooperation [31][32] Question: Changes in competition - Management observed aggressive promotions from competitors but did not believe promotional activity was the primary issue affecting their performance [34][35] Question: Reduction in CapEx guidance - Management explained the $3 million reduction in CapEx was due to tariff uncertainty, prompting a cautious approach to store expansion [36][37] Question: Performance of new stores - Management reported positive performance from new stores, leveraging existing distribution networks, and noted that initial traffic has been good [47][48]

Core Points - Havertys Furniture is hosting a Military Appreciation Event on May 3 across all 130 showrooms to honor local military families [1][5] - The company is partnering with Tempur-Pedic to donate 78 mattresses to The Joel Fund, a non-profit organization supporting military veterans and their families [3][4] - The event includes exclusive giveaways, refreshments, special financing, and a chance to win a $1,000 gift certificate [2] Company Overview - Havertys, established in 1885, operates 130 showrooms in 17 states, offering a wide selection of home furnishings in middle to upper-middle price ranges [6] - The company has a history of supporting military families, including ongoing military discounts [4] Non-Profit Partnership - The Joel Fund, founded in 2016, aims to reconnect veterans to life at home through community engagement and support programs [7] - The donation of mattresses will directly benefit military families identified by The Joel Fund as in need [3][4]

Financial Data and Key Metrics Changes - In Q1 2025, the company reported net sales of $181.6 million, a decrease of 1.3% compared to the prior year quarter, with comparable store sales down 4.8% [3][17] - Gross profit margin increased by 90 basis points to 61.2% from 60.3% due to product selection and merchandise mix [4][17] - SG&A expenses decreased by $2.2 million or 1.9% to $107.2 million, representing 59% of sales, down from 59.4% in the prior year quarter [18] - Net income for Q1 2025 was $3.8 million or $0.23 per diluted share, compared to $2.4 million or $0.14 per share in the comparable quarter last year [18] Business Line Data and Key Metrics Changes - The design business improved to approximately 33% of total business, with the designer average ticket growing over 9% to over $7,400 [6] - Average ticket rose by approximately 4% to just over $3,300, while written sales were down 2.6% with comps down 6.3% [3][6] Market Data and Key Metrics Changes - The housing market continues to operate at thirty-year lows, influenced by affordability issues, inflated interest rates, and declining consumer confidence [4][16] - Sales for the Presidents' Day event were disappointing, down roughly 10% over the two-week period [5] Company Strategy and Development Direction - The company plans to roll out a new point of purchase and tagging program to enhance the in-store customer experience by Labor Day [7] - The company aims to open five new stores a year but will be cautious based on current conditions, with plans for a third store in Houston and relocating an existing store [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating challenges such as housing affordability, high interest rates, and tariffs, citing a strong brand and debt-free balance sheet [16] - The company anticipates gross margins for 2025 to be between 60% and 60.5%, with fixed and discretionary SG&A expenses expected to increase due to store growth and inflation [21] Other Important Information - The company has halted most direct shipments from China due to tariffs, which could cause temporary supply disruptions [10] - Inventories increased by approximately $5 million or about 6% since year-end 2024, with expectations for further increases in Q2 [11][12] Q&A Session Summary Question: Impact of winter storms on business - Management noted that multiple winter storms impacted business, but did not quantify the exact impact [24][27] Question: Price increases due to tariffs - Management confirmed that targeted price increases will be implemented, but they expect minimal impact on consumers due to supplier support [30][31] Question: Changes in competition - Management observed aggressive promotions from competitors but did not believe it was affecting their promotional activity [33] Question: Reduction in CapEx guidance - The reduction in CapEx guidance was due to tariff uncertainty, prompting a cautious approach to store expansion [35][36] Question: Performance of new stores - Management reported positive performance from new stores, leveraging existing distribution networks, and expressed optimism for future openings [47][49]

Company Performance - Haverty Furniture (HVT) reported quarterly earnings of $0.23 per share, exceeding the Zacks Consensus Estimate of $0.14 per share, and up from $0.14 per share a year ago, representing an earnings surprise of 64.29% [1] - The company posted revenues of $181.57 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 2.18%, although this is a decrease from year-ago revenues of $184 million [2] - Over the last four quarters, Haverty Furniture has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] Stock Outlook - Haverty Furniture shares have declined approximately 17.4% since the beginning of the year, compared to a decline of 5.5% for the S&P 500 [3] - The current consensus EPS estimate for the coming quarter is $0.22 on revenues of $178.98 million, and for the current fiscal year, it is $1.28 on revenues of $751.92 million [7] Industry Context - The Retail - Home Furnishings industry, to which Haverty Furniture belongs, is currently ranked in the bottom 16% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Haverty's stock performance [5]