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Hooker Furniture Reports Higher 2013 First Half Income On Lower Sales

Stocks in this article: HOFT

Dividends

At its September 5, 2012 meeting, our board of directors declared a quarterly cash dividend of $0.10 per share, payable on November 30, 2012 to shareholders of record at November 16, 2012.

Conference Call Details

Hooker Furniture will present its fiscal 2013 second quarter results via teleconference and live internet web cast on Thursday morning, September 6, 2012 at 9:00 AM Eastern Time. The dial-in number for domestic callers is 877-665-2466 and the number for international callers is 678-894-3031. The call will be simultaneously web cast and archived for replay on the Company's web site at www.hookerfurniture.com in the Investor Relations section.

Ranked among the nation's top 10 largest publicly traded furniture sources based on 2011 shipments to U.S. retailers, Hooker Furniture Corporation is an 88-year old residential wood, metal and upholstered furniture resource. Major casegoods product categories include home entertainment, home office, accent, dining, and bedroom furniture in the upper-medium price points sold under the Hooker Furniture brand, and youth bedroom furniture sold under the Opus Designs by Hooker Furniture brand. Hooker's residential upholstered seating companies include Bradington-Young, a specialist in upscale motion and stationary leather furniture, and Sam Moore Furniture, a specialist in upscale fabric occasional chairs with an emphasis on cover-to-frame customization. Please visit our websites at www.hookerfurniture.com , www.bradington-young.com , www.sammoore.com  and www.opusdesigns.com .

The Hooker Furniture Corporation logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=4305

Certain statements made in this report, other than those based on historical facts, are forward-looking statements. These statements reflect our reasonable judgment with respect to future events and typically can be identified by the use of forward-looking terminology such as "believes," "expects," "projects," "intends," "plans," "may," "will," "should," "would," "could" or "anticipates," or the negative thereof, or other variations thereon, or comparable terminology, or by discussions of strategy. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Those risks and uncertainties include but are not limited to: (1) general economic or business conditions, both domestically and internationally, and instability in the financial and credit markets, including their potential impact on our (i) sales and operating costs and access to financing, (ii) customers and suppliers and their ability to obtain financing or generate the cash necessary to conduct their respective businesses; (2) risks associated with domestic manufacturing operations, including fluctuations in capacity utilization and the prices and availability of key raw materials as well as transportation, warehousing and domestic labor costs and environmental compliance and remediation costs; (3) disruptions involving our vendors or the transportation and handling industries, particularly those affecting imported products, including customs issues, labor stoppages, strikes or slowdowns and the availability of shipping containers and cargo ships; (4) our ability to successfully implement our business plan to increase sales and improve financial performance, including possible adverse effects on our results due to material restructuring or asset impairment charges if we are unsuccessful; (5) volatility in the increased costs of imported goods, including fluctuations and increases in the prices of purchased finished goods and transportation and warehousing costs; (6) higher than expected costs associated with product quality and safety, including costs related to defective or non-compliant products as well as regulatory compliance costs related to the sale of consumer products; (7) the direct and indirect costs associated with the implementation of our Enterprise Resource Planning system, including costs resulting from unanticipated disruptions to our business; (8) price competition in the furniture industry; (9) changes in domestic and international monetary policies and fluctuations in foreign currency exchange rates affecting the price of our imported products and raw materials; (10) the cyclical nature of the furniture industry, which is particularly sensitive to changes in the housing markets, consumer confidence, the amount of consumers' income available for discretionary purchases, and the availability and terms of consumer credit; (11) supply, transportation and distribution disruptions, particularly those affecting imported products, including the availability of shipping containers and cargo ships; (12) achieving and managing growth and change, and the risks associated with international operations, acquisitions, restructurings, and strategic alliances; (13) adverse political acts or developments in, or affecting, the international markets from which we import products, including duties or tariffs imposed on those products; (14) risks associated with distribution through third-party retailers, such as non-binding dealership arrangements; (15) capital requirements and costs; and (16) competition from non-traditional outlets, such as catalogs and internet retailers and home improvement centers; changes in consumer preferences, including increased demand for lower-quality, lower-priced furniture due to declines in consumer confidence and/or discretionary income available for furniture purchases and the availability of consumer credit. Any forward looking statement that we make speaks only as of the date of that statement, and we undertake no obligation, except as required by law, to update any forward-looking statements whether as a result of new information, future events or otherwise.

Table I
HOOKER FURNITURE CORPORATION AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
         
  Thirteen Weeks Ended Twenty-Six Weeks Ended
  July 29, 2012 July 31, 2011 July 29, 2012 July 31, 2011
         
Net sales  $ 50,185  $ 55,574  $ 101,915  $ 113,967
         
Cost of sales  38,920  43,411  79,728  90,771
         
Gross profit  11,265  12,163  22,187  23,196
         
Selling and administrative expenses  8,943  9,669  18,337  19,955
         
Operating income  2,322  2,494  3,850  3,241
         
Other income, net  20  27  64  81
         
Income before income taxes  2,342  2,521  3,914  3,322
         
Income tax expense  868  875  1,420  1,153
         
Net income  $ 1,474  $ 1,646  $ 2,494  $ 2,169
         
Earnings per share:        
Basic  $ 0.14  $ 0.15  $ 0.23  $ 0.20
Diluted  $ 0.14  $ 0.15  $ 0.23  $ 0.20
         
Weighted average shares outstanding:        
Basic 10,770 10,761 10,771 10,761
Diluted 10,789 10,784 10,800 10,785
 
 
Table II
HOOKER FURNITURE CORPORATION AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)
     
  Thirteen Weeks Ended Twenty-Six Weeks Ended
  July 29, 2012 July 31, 2011 July 29, 2012 July 31, 2011
         
Net Income  $ 1,474  $ 1,646  $ 2,494  $ 2,169
Other comprehensive income:        
Amortization of actuarial gains  (14) (82)  (29)  (163)
Income tax effect on amortization of actuarial gains  5  31  11  61
Adjustments to net periodic benefit cost  (9)  (51)  (18)  (102)
         
Comprehensive Income  $ 1,465  $ 1,595  $ 2,476  $ 2,067
 
 
Table III
HOOKER FURNITURE CORPORATION AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, including share data)
     
  July 29, 2012 January 29, 2012
Assets    
Current assets    
Cash and cash equivalents  $ 43,325  $ 40,355
Accounts receivable, less allowance for doubtful accounts of $1,467 and $1,632, respectively 23,711  25,807
Inventories 35,820  34,136
Prepaid expenses and other current assets 3,749  4,194
Total current assets  106,605  104,492
Property, plant and equipment, net 22,570  21,669
Intangible assets 1,257  1,257
Cash surrender value of life insurance policies 17,185  16,217
Other assets  5,088  5,536
Total assets  $ 152,705  $ 149,171
     
Liabilities and Shareholders' Equity    
Current liabilities    
Trade accounts payable  $ 12,660  $ 9,233
Accrued salaries, wages and benefits 2,321  3,855
Other accrued expenses 2,090  792
Accrued dividends  1,078  1,078
Total current liabilities  18,149  14,958
Deferred compensation 7,299  7,100
Total liabilities  25,448  22,058
     
Shareholders' equity    
Common stock, no par value, 20,000 shares authorized, 10,781 and 10,782 shares issued and outstanding on each date 17,313  17,262
Retained earnings 109,853  109,742
Accumulated other comprehensive income  91  109
Total shareholders' equity  127,257  127,113
Total liabilities and shareholders' equity  $ 152,705  $ 149,171
 
 
 Table IV 
 HOOKER FURNITURE CORPORATION AND SUBSIDIARIES 
 UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 
 (In thousands) 
     
   Twenty-Six Weeks Ended 
  July 29, 2012 July 31, 2011
 Cash flows from operating activities     
 Cash received from customers   $ 104,093  $ 115,290
 Cash paid to suppliers and employees  (95,713) (96,924)
 Income taxes received/(paid), net  13 (115)
 Interest (paid)/received, net  (20) 20
 Net cash provided by operating activities  8,373 18,271
     
 Cash flows from investing activities     
 Purchase of property, plant and equipment  (2,935) (1,871)
 Proceeds received on notes issued for the sale of property  18  17
 Proceeds from the sale of property and equipment  598  3
 Premiums paid on life insurance policies  (783) (1,020)
 Proceeds received on life insurance policies   --  560
 Net cash used in investing activities  (3,102) (2,311)
     
 Cash flows from financing activities     
 Cash dividends paid  (2,159) (2,156)
 Purchase and retirement of common stock  (142)  -- 
 Net cash used in financing activities  (2,301) (2,156)
     
 Net increase in cash and cash equivalents  2,970 13,804
 Cash and cash equivalents at beginning of period  40,355 16,623
 Cash and cash equivalents at end of period   $ 43,325  $ 30,427
     
     
 Reconciliation of net income to net cash provided by operating activities:   
 Net income   $ 2,494  $ 2,169
 Depreciation and amortization  1,475 1,255
 Non-cash restricted stock awards and performance grants  160 (101)
 Provision for doubtful accounts  (13) 705
 Deferred income taxes  387 (346)
 (Gain) on disposal of property   (39)  (3)
 (Gain) on insurance policies   (460)  (388)
 Changes in assets and liabilities:     
 Accounts receivable  2,109 551
 Inventories  (1,684) 15,330
 Prepaid expenses and other current assets  774 667
 Trade accounts payable  3,427 (2,399)
 Accrued salaries, wages and benefits  (1,534) (448)
 Accrued income taxes  1,046 1,384
 Other accrued expenses  170 (373)
 Deferred compensation  61 268
 Net cash provided by operating activities   $ 8,373  $ 18,271
CONTACT: Paul B. Toms Jr.
         Chairman and Chief Executive Officer
         Phone: (276) 632-2133, or
         Paul Huckfeldt, Vice President, Chief Financial Officer
         Phone: (276) 632-2133, or
         Kim D. Shaver
         Vice President, Marketing Communications
         Phone: (336) 880-1230

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