0000216085-24-000008.txt : 20240501
0000216085-24-000008.hdr.sgml : 20240501
20240501162918
ACCESSION NUMBER: 0000216085-24-000008
CONFORMED SUBMISSION TYPE: 8-K
PUBLIC DOCUMENT COUNT: 18
CONFORMED PERIOD OF REPORT: 20240501
ITEM INFORMATION: Results of Operations and Financial Condition
ITEM INFORMATION: Financial Statements and Exhibits
FILED AS OF DATE: 20240501
DATE AS OF CHANGE: 20240501
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: HAVERTY FURNITURE COMPANIES INC
CENTRAL INDEX KEY: 0000216085
STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-FURNITURE STORES [5712]
ORGANIZATION NAME: 07 Trade & Services
IRS NUMBER: 580281900
STATE OF INCORPORATION: MD
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 8-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 001-14445
FILM NUMBER: 24903477
BUSINESS ADDRESS:
STREET 1: 780 JOHNSON FERRY ROAD
STREET 2: SUITE 800
CITY: ATLANTA
STATE: GA
ZIP: 30342
BUSINESS PHONE: 404-443-2900
MAIL ADDRESS:
STREET 1: 780 JOHNSON FERRY ROAD
STREET 2: SUITE 800
CITY: ATLANTA
STATE: GA
ZIP: 30342
8-K
1
hvt8k5124.htm
Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): May 1, 2024 (May 1, 2024)
Haverty Furniture Companies, Inc.
(Exact Name of Registrant as Specified in Its Charter)
1-14445
(Commission File Number)
Maryland
58-0281900
(State or Other Jurisdiction of Incorporation)
(I.R.S. Employer Identification No.)
780 Johnson Ferry Road, NE, Suite 800
Atlanta, Georgia30342
(Address of principal executive offices, including zip code)
(404) 443-2900
(Registrant’s telephone number, including area code)
NOT APPLICABLE
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s)
Name of each exchange on which registered
Common Stock
HVT
NYSE
Class A Common Stock
HVTA
NYSE
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange
Act of 1934 (§240.12b-2 of this chapter):
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards
provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02Results
of Operations and Financial Condition
On May 1, 2024, Havertys issued a press release regarding the declaration and increase in its quarterly dividend and the results of its operations for the quarter
ended March 31, 2024. A copy of the press release is furnished as Exhibit 99.1. The attached Exhibit 99.1 is not filed but is furnished to comply with Regulation FD. The information disclosed in this Item 2.02 Current Report on Form 8-K is not
considered to be “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934 and is not subject to the liabilities of that section.
Item 9.01Financial Statements and
Exhibits
(d) Exhibits. The following exhibit is furnished as part of this Report:
99.1 Press
Release dated May 1, 2024, issued by Registrant.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HAVERTY FURNITURE COMPANIES, INC.
May 1, 2024
By:
Jenny Hill Parker
Senior Vice President, Finance and
Corporate Secretary
EX-99.1
2
hvtex99.htm
99.1 PRESS RELEASE DATED MAY 1, 2024, ISSUED BY REGISTRANT
EXHIBIT 99.1
Havertys Announces Increase In Quarterly Dividend and First Quarter 2024 Results
Atlanta, Georgia, May 1, 2024 – HAVERTYS (NYSE: HVT and HVT.A), today announced an increase to its quarterly dividend (the 12th consecutive annual increase) and reported operating results for the first quarter ended March 31, 2024.
Dividend
The board of directors declared a 6.7% increase in the quarterly dividend, from $0.30 per share to $0.32 per share on the company's common stock.
The quarterly dividend for the company's Class A common stock is also being increased from $0.28 to $0.30 per share.
The dividend is payable on June 14, 2024, to stockholders of record at the close of business on May 24, 2024. Havertys has paid a cash dividend in
each year since 1935.
First quarter 2024
versus first quarter 2023:
•
Diluted earnings per common share (“EPS”) of $0.14 versus $0.74.
Gross profit margin increased to 60.3% from 59.1%.
Clarence H. Smith, Chairman and CEO said, “Our sales reflect the challenges from the ongoing weak housing market. The decline in demand requires
exceptional customer engagement and operational flexibility. We began highlighting our regret-free guarantee early in 2024 and continued promoting our free-in home design service which grew 10.4% in the first quarter compared to last year and was
32.3% of our total written business. Our teams generated another quarter of excellent gross margins of 60.3% and the prudent reductions in operating costs generated positive results for the quarter.
We are investing capital to expand our business and are on track to open five new stores this year and five in 2025. Our new store located in
Southaven, MS in the Memphis, TN market opened at the end of March. The three stores we previously announced are in-fill opportunities in growing areas of Florida and should open in the second and third quarter this year. We plan to enter the
Houston, TX market later this year with one store slated to open in the fourth quarter and additional locations in early 2025. This is a sizeable new market within our distribution footprint that we believe aligns well with the Havertys brand.
We are making important investments in our stores and online presence to be well-positioned to gain additional market share at the reversal of this
near-term demand cycle. The board's decision to increase the quarterly dividend reflects our strong financial position and long-term outlook as we invest in our business and return capital to our stockholders."
NEWS RELEASE – May 1, 2024
Page 2
Key Results
(amounts in millions, except per share amounts)
Results of Operations
Three Months Ended March 31,
2024
2023
Sales
$
184.0
$
224.8
Gross Profit
111.0
132.8
Gross profit as a % of sales
60.3
%
59.1
%
SGA
Variable
37.0
44.9
Fixed
72.4
73.5
Total
109.4
118.4
SGA as a % of sales
Variable
20.1
%
20.0
%
Fixed
39.3
%
32.7
%
Total
59.4
%
52.7
%
Pre-tax income
3.2
15.4
Pre-tax income as a % of sales
1.7
%
6.9
%
Net income
2.4
12.4
Net income as a % of sales
1.3
%
5.5
%
Diluted earnings per share (“EPS”)
$
0.14
$
0.74
Other Financial and Operations Data
Three Months Ended March 31,
2024
2023
EBITDA (in millions)(1)
$
6.6
$
18.8
Sales per square foot
$
169
$
208
Average ticket
$
3,208
$
3,192
Liquidity Measures
Three Months Ended March 31,
Three Months Ended March 31,
Free Cash Flow
2024
2023
Cash Returns to Shareholders
2024
2023
Operating cash flow
$
3.1
$
11.1
Share repurchases
$
—
$
—
Dividends
4.8
4.5
Capital expenditures
(6.4
)
(6.7
)
Cash returns to shareholders
$
4.8
$
4.5
Free cash flow
$
(3.3
)
$
4.4
Cash at period end
$
117.9
$
127.0
(1)
See the reconciliation of the non-GAAP metrics at the end of the release.
NEWS RELEASE – May 1,
2024
Page 3
First Quarter ended March 31, 2024 Compared to Same Period of 2023
•
Total sales down 18.1%, comp-store sales down 18.5% for the quarter. Total written sales were down 12.6% and written comp-store sales declined 13.0% for the
quarter.
•
Gross profit margins increased to 60.3% in 2024 from 59.1% in 2023.
•
SG&A expenses were 59.4% of sales versus 52.7% and decreased $9.0 million. The primary drivers of this change are:
◦
decrease of $4.8 million in selling expenses, primarily variable costs tied to commissioned-based compensation expense and third-party
creditor costs.
◦
decrease in warehouse and delivery costs of $3.2 million primarily from reduced headcount via attrition and lower expenditures for supplies and fuel.
◦
decrease of $0.6 million in advertising expenses driven by reduced spending on television and interactive marketing partly offset by
increased technology costs.
Balance Sheet and Cash Flow for the Three Months ended March 31, 2024
•
Cash, cash equivalents, and restricted cash equivalents at March 31, 2024 are $117.9 million.
•
Generated $3.1 million in cash from operating activities primarily from earnings and
changes in working capital including a $5.1 million increase in customer deposits, a $1.9 million reduction in inventories, and a $12.8 million decrease in vendor repayments and accrued liabilities.
•
Invested $6.4 million in capital expenditures.
•
Paid $4.8 million in quarterly cash dividends.
•
No debt outstanding at March 31, 2024 and credit availability of $80.0 million.
Expectations and Other
•
We are increasing our expectations for gross profit margins for 2024 to be between 60.0% to 60.5%. The adjustment is based on our merchandising mix and anticipated changes in product
and freight costs. Gross profit margins fluctuate quarter to quarter in relation to our promotional cadence.
•
Fixed and discretionary expenses within SG&A for the full year of 2024 are expected
to be in the $290.0 to $292.0 million range, a reduction in our previous guidance related to
advertising and other costs. Variable SG&A expenses for the full year of 2024 are anticipated to be in the 19.9% to 20.2% range.
•
Our effective tax rate for 2024 is expected to be 26.5% excluding the impact from
discrete items and any new tax legislation.
•
Planned capital expenditures for the full year of 2024 are approximately $32.0 million. We expect retail square footage will increase approximately 3.4% in 2024 over 2023.
NEWS RELEASE – May 1, 2024
Page 4
HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended
March 31,
(In thousands, except per share data)
2024
2023
Net sales
$
183,997
$
224,754
Cost of goods sold
72,978
91,969
Gross profit
111,019
132,785
Expenses:
Selling, general and administrative
109,356
118,361
Other expense (income), net
23
(4
)
Total expenses
109,379
118,357
Income before interest and income taxes
1,640
14,428
Interest income, net
1,555
1,010
Income before income taxes
3,195
15,438
Income tax expense
802
3,066
Net income
$
2,393
$
12,372
Basic earnings per share:
Common Stock
$
0.15
$
0.77
Class A Common Stock
$
0.13
$
0.72
Diluted earnings per share:
Common Stock
$
0.14
$
0.74
Class A Common Stock
$
0.13
$
0.71
Cash dividends per share:
Common Stock
$
0.30
$
0.28
Class A Common Stock
$
0.28
$
0.26
NEWS RELEASE – May 1, 2024
Page 5
HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
March 31,
2024
December 31,
2023
March 31,
2023
Assets
Current assets
Cash and cash equivalents
$
111,818
$
120,635
$
120,170
Restricted cash and cash equivalents
6,045
7,142
6,876
Inventories
92,078
93,956
114,254
Prepaid expenses
17,361
17,067
11,430
Other current assets
13,697
12,793
19,590
Total current assets
240,999
251,593
272,320
Property and equipment, net
173,128
171,588
139,212
Right-of-use lease assets
196,976
202,306
207,673
Deferred income taxes
15,594
15,641
16,332
Other assets
13,832
13,005
12,878
Total assets
$
640,529
$
654,133
$
648,415
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable
$
16,980
$
18,781
$
15,632
Customer deposits
40,912
35,837
46,382
Accrued liabilities
35,681
46,289
40,372
Current lease liabilities
37,572
37,357
36,180
Total current liabilities
131,145
138,264
138,566
Noncurrent lease liabilities
174,680
180,397
185,866
Other liabilities
28,014
27,106
27,571
Total liabilities
333,839
345,767
352,003
Stockholders’ equity
306,690
308,366
296,412
Total liabilities and stockholders’ equity
$
640,529
$
654,133
$
648,415
NEWS RELEASE – May 1, 2024
Page 6
HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
Three Months Ended
March 31,
2024
2023
Cash Flows from Operating Activities:
Net income
$
2,393
$
12,372
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
4,946
4,362
Share-based compensation expense
2,643
1,957
Other
58
(840
)
Changes in operating assets and liabilities:
Inventories
1,878
4,079
Customer deposits
5,075
(1,587
)
Other assets and liabilities
(1,104
)
5,721
Accounts payable and accrued liabilities
(12,754
)
(14,990
)
Net cash provided by operating activities
3,135
11,074
Cash Flows from Investing Activities:
Capital expenditures
(6,399
)
(6,655
)
Proceeds from sale of land, property and equipment
48
13
Net cash used in investing activities
(6,351
)
(6,642
)
Cash Flows from Financing Activities:
Dividends paid
(4,845
)
(4,528
)
Taxes on vested restricted shares
(1,853
)
(2,788
)
Net cash used in financing activities
(6,698
)
(7,316
)
Decrease in cash, cash equivalents and restricted cash equivalents during the period
(9,914
)
(2,884
)
Cash, cash equivalents and restricted cash equivalents at beginning of period
127,777
129,930
Cash, cash equivalents and restricted cash equivalents at end of period
$
117,863
$
127,046
NEWS RELEASE – May 1, 2024
Page 7
GAAP to Non-GAAP Reconciliation
We report our financial results in accordance with accounting principles generally accepted in the United States ("GAAP"). We supplement the reporting of our
financial information under GAAP with certain non-GAAP financial information. The non-GAAP information presented provides additional useful information but should not be considered in isolation or as substitutes for the related GAAP measures. We
believe that EBITDA is a meaningful measure to share with investors.
Reconciliation of GAAP measures to EBITDA
Three Months Ended March 31,
(in thousands)
2024
2023
Income before income taxes, as reported
$
3,195
$
15,438
Interest income, net
(1,555
)
(1,010
)
Depreciation
4,946
4,362
EBITDA
$
6,586
$
18,790
Comparable Store Sales
Comparable-store or “comp-store” sales is a measure which indicates the performance of our existing stores and website by comparing the sales growth for stores and
online for a particular month over the corresponding month in the prior year. Stores are considered non-comparable if they were not open during the corresponding month or if the selling square footage has been changed significantly.
Cost of Goods Sold and SG&A Expense
We include substantially all our occupancy and home delivery costs in SG&A expense as well as a portion of our warehousing expenses. Accordingly, our gross
profit may not be comparable to those entities that include these costs in cost of goods sold.
We classify our SG&A expenses as either variable or fixed and discretionary. Our variable expenses are comprised of selling and delivery costs. Selling
expenses are primarily compensation and related benefits for our commission-based sales associates, the discount we pay for third party financing of customer sales and transaction fees for credit card usage. We do not outsource delivery, so these
costs include personnel, fuel, and other expenses related to this function. Fixed and discretionary expenses are comprised of rent, depreciation and amortization and other occupancy costs for stores, warehouses and offices, and all advertising and
administrative costs.
Conference Call Information
The company invites interested parties to listen to the live webcast of the conference call on May 2, 2024 at 10:00 a.m. ET at its website, ir.havertys.com. If you cannot listen live, a replay will be available on the day of the conference call at the website at approximately 1:00 p.m. ET.
About Havertys
Havertys (NYSE: HVT and HVT.A), established in 1885, is a full-service home furnishings retailer with 124 showrooms in 17 states in the Southern and Midwestern regions
providing its customers with a wide selection of quality merchandise in middle to upper-middle price ranges. Additional information is available on the Company’s website havertys.com.
NEWS RELEASE – May 1, 2024
Page 8
Safe Harbor
This press release contains, and the conference call may contain forward-looking statements subject to the safe harbor provisions of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Act of 1934. These forward-looking statements are subject to risks and uncertainties and change based on various important factors, many of which are beyond our control.
All statements in the future tense and all statements accompanied by words such as “expect,” “likely,” “outlook,” “forecast,” “preliminary,” “would,” “could,” “should,”
“position,” “will,” “project,” “intend,” “plan,” “on track,” “anticipate,” “to come,” “may,” “possible,” “assume,” and variations of such words and similar expressions are intended to identify such forward-looking statements. These forward-looking
statements include, without limitation, our expectations for retail and operating margins, selling square footage and capital expenditures for 2024, our liquidity position to
continue to fund our growth plans, and our efforts and initiatives to execute our strategic plan.
We caution that our forward-looking statements involve risks and uncertainties, and while we believe that our expectations for the future are reasonable in view of
currently available information you are cautioned not to place undue reliance on our forward-looking statements, and they should not be relied upon as a prediction of actual results. Factors that could cause actual results to differ materially from
those expressed or implied in any forward-looking statements include, but are not limited to: disruptions in our suppliers' operations; changes in national and international legislation or government regulations or policies, including changes to
import tariffs and the unpredictability of such changes; failure of vendors to meet our quality control standards or to react to changes in legislative or regulatory frameworks; disruptions in our distribution centers; changes in general economic
conditions, including unemployment, inflation (including the impact of tariffs); labor shortages and the Company's ability to successfully attract and retain employees in the current labor market; uncertain credit markets and other macroeconomic
conditions; competitive product, service and pricing pressures; failure or weakness in our disclosure controls and procedures and internal controls over financial reporting; disruptions caused by a failure or breach of the Company's information
systems and information technology infrastructure, as well as other risks and uncertainties discussed in the Company's Annual Report on Form 10-K for 2023 and from time to time
in the Company's subsequent filings with the SEC.
Forward-looking statements describe our expectations only as of the date they are made, and the Company undertakes no duty to update its forward-looking statements except
as required by law. You are advised, however, to review any further disclosures we make on related subjects in our subsequent Forms 10-K, 10-Q, 8-K, and other reports filed with the SEC.
For the EDGAR submission types of Form 8-K: the date of the report, the date of the earliest event reported; for the EDGAR submission types of Form N-1A: the filing date; for all other submission types: the end of the reporting or transition period. The format of the date is YYYY-MM-DD.
The type of document being provided (such as 10-K, 10-Q, 485BPOS, etc). The document type is limited to the same value as the supporting SEC submission type, or the word 'Other'.
Commission file number. The field allows up to 17 characters. The prefix may contain 1-3 digits, the sequence number may contain 1-8 digits, the optional suffix may contain 1-4 characters, and the fields are separated with a hyphen.
Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act.
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act.
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as soliciting material pursuant to Rule 14a-12 under the Exchange Act.
Boolean flag that is true when the Form 8-K filing is intended to satisfy the filing obligation of the registrant as written communications pursuant to Rule 425 under the Securities Act.
