-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LB/kfAghUff99Hf4zEPRyxKR1A4aFW/kdZ0xv3UYDyrhb8Zu8dRfUaJBaCi35zb/ VE5RGZ/RBFEhuFBvBqshlw== 0000897069-98-000339.txt : 19980610 0000897069-98-000339.hdr.sgml : 19980610 ACCESSION NUMBER: 0000897069-98-000339 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980502 FILED AS OF DATE: 19980609 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: NOBILITY HOMES INC CENTRAL INDEX KEY: 0000072205 STANDARD INDUSTRIAL CLASSIFICATION: MOBILE HOMES [2451] IRS NUMBER: 591166102 STATE OF INCORPORATION: FL FISCAL YEAR END: 1027 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-06506 FILM NUMBER: 98644392 BUSINESS ADDRESS: STREET 1: 3741 S W 7TH ST CITY: OCALA STATE: FL ZIP: 34478 BUSINESS PHONE: 9047325157 MAIL ADDRESS: STREET 1: P O BOX 1659 CITY: OCALA STATE: FL ZIP: 34478-1659 10-Q 1 NOBILITY HOMES, INC.'S FORM 10-Q FORM 10-Q SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For the Quarterly period ended May 2, 1998 Commission File number 0-6506 NOBILITY HOMES, INC. (Exact name of registrant as specified in its charter) Florida 59-1166102 (State or other jurisdiction (I.R.S. Employer of incorporation or Identification No.) organization) 3741 S.W. 7th Street Ocala, Florida 34474 (Address of principal executive offices) (Zip Code) (352) 732-5157 (Issuer's telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Name of each exchange Title of each class on which registered ------------------- --------------------- None None Securities registered pursuant to Section 12(g) of the Act: Common Stock $.10 par value (Title of Class) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X; No _____. (APPLICABLE ONLY TO CORPORATE ISSUERS) State the number of shares outstanding of each of the issuer's classes of common equity, as of June 5, 1998. 4,456,251 NOBILITY HOMES, INC. INDEX Page Number PART I. Financial Information Item 1. Financial Statements Consolidated Balance Sheets as of May 2, 1998 and November 1, 1997 3 Consolidated Statements of Income for the three and six months ended May 2, 1998 and May 3, 1997 4 Consolidated Statements of Cash Flows for the three and six months ended May 2, 1998 and May 3, 1997 5 Notes to Consolidated Financial Statements 6 Item 2. Management's Discussion and Analysis of Results of Operations and Financial Conditions 7 PART II. Other Information and Signatures Item 6. Exhibits and Reports of Form 8-K 8 PART I. FINANCIAL INFORMATION NOBILITY HOMES, INC. CONSOLIDATED BALANCE SHEETS
May 2, 1998 November 1, 1997 ----------- ---------------- ASSETS (Unaudited) ------ Current Assets: Cash and cash equivalents $ 7,082,545 $ 6,293,924 Accounts receivable - trade 1,257,968 386,019 Inventories 8,227,500 8,041,471 Deferred income taxes 150,100 150,100 Prepaid expenses and other current assets 176,307 113,857 ----------- ----------- Total current assets 16,894,420 14,985,371 Property, plant and equipment, net 1,310,539 1,285,112 Investment in joint venture 310,846 263,024 Deferred income taxes - noncurrent 697,100 697,100 Other assets 1,679,140 1,710,023 ----------- ----------- Total assets $ 20,892,045 $ 18,940,630 =========== =========== LIABILITIES & STOCKHOLDERS' EQUITY ---------------------------------- Current liabilities: Accounts payable $ 1,501,164 $ 1,592,980 Accrued compensation 540,898 606,651 Accrued expenses and other current liabilities 1,499,442 1,044,186 Income taxes payable 248,050 402,979 ----------- ----------- Total current liabilities 3,789,554 3,646,796 ----------- ----------- Stockholders' equity: Preferred stock, $.10 par value, 500,000 shares authorized, none issued - - Common stock, $.10 par value, 10,000,000 shares authorized, 4,922,087 shares issued in 1998 and 1997 492,209 492,209 Additional paid in capital 2,197,185 2,197,185 Retained earnings 16,093,164 14,284,507 Less treasury stock at cost, 465,836 shares (1,680,067) (1,680,067) ----------- ----------- Total stockholders' equity 17,102,491 15,293,834 ----------- ----------- Commitments and contingencies - - ----------- ----------- Total liabilities and stockholders' equity $ 20,892,045 $ 18,940,630 =========== ===========
NOBILITY HOMES, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
Three Months Ended Six Months Ended ------------------ ---------------- May 2, May 3, May 2, May 3, 1998 1997 1998 1997 ---- ---- ---- ---- Net sales $ 11,277,506 $ 9,506,324 $ 21,866,558 $ 18,499,829 Net sales - related parties 46,997 98,376 63,910 150,863 ----------- ----------- ----------- ----------- Total net sales 11,324,503 9,604,700 21,930,468 18,650,692 Less cost of goods sold (8,284,991) (7,108,823) (16,180,605) (13,935,411) ----------- ----------- ----------- ----------- Gross profit 3,039,512 2,495,877 5,749,863 4,715,281 Selling, general and administrative expenses (1,502,550) (1,419,325) (3,006,442) (2,785,896) ----------- ----------- ----------- ----------- Operating income 1,536,962 1,076,552 2,743,421 1,929,385 Other income: Interest income 72,826 19,131 136,645 37,821 Undistributed earnings in joint venture 21,970 - 47,822 - Miscellaneous income 4,587 49,302 7,769 55,991 ----------- ----------- ----------- ----------- 99,383 68,433 192,236 93,812 ----------- ----------- ----------- ----------- Income before provision for income taxes 1,636,345 1,144,985 2,935,657 2,023,197 Less provision for income taxes (628,000) (440,000) (1,127,000) (777,000) ----------- ----------- ----------- ----------- Net income $ 1,008,345 $ 704,985 $ 1,808,657 $ 1,246,197 =========== =========== =========== =========== Weighted average shares outstanding(1) Basic 4,456,251 4,456,251 4,456,251 4,456,251 Diluted 4,516,234 4,456,251 4,516,234 4,456,251 Earnings per share(1) Basic $ 0.23 $ 0.16 $ 0.41 $ 0.28 Diluted $ 0.22 $ 0.16 $ 0.40 $ 0.28
(1) Restated to reflect three-for-two-stock split in the form of a stock dividend paid on February 20, 1998 NOBILITY HOMES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Six Months Ended ---------------- May 2, May 3, 1998 1997 ---- ---- Cash flows from operating activities: Net income $ 1,808,657 $ 1,246,197 Adjustments to reconcile net income to net cash flows provided (used in) by operating activities: Depreciation and amortization 105,427 72,098 Undistributed earnings in joint venture (47,822) - (Increase) decrease in: Accounts receivable -trade (871,949) (276,870) Accounts receivable -trade from related parties - (142,972) Inventories (186,029) (1,154,659) Prepaid expenses and other current assets (62,450) (126,930) Increase (decrease) in: Accounts payable (91,816) (244,244) Accrued compensation (65,753) - Accrued expenses and other current liabilities 455,256 423,981 Income taxes payable (154,929) 41,409 ----------- ----------- Net cash flows provided by (used in) operating activities 888,592 (161,990) ----------- ----------- Cash flows from investing activities: Purchase of equipment (99,971) (148,014) ----------- ----------- Net cash flows (used in) investing activities (99,971) (148,014) ----------- ----------- Increase (decrease) in cash and cash equivalents 788,621 (310,004) Cash and cash equivalents at beginning of year 6,293,924 2,049,184 ----------- ----------- Cash and cash equivalents at end of quarter $ 7,082,545 $ 1,739,180 =========== =========== Supplemental disclosure of cash flow information Income taxes paid $ 1,300,000 $ 712,500 =========== ===========
NOBILITY HOMES, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. The unaudited financial information included in this report includes all adjustments which are, in the opinion of management, necessary to reflect a fair statement of the results for the interim periods. The operations for the six months ended May 2, 1998 are not necessarily indicative of the results of the full fiscal year. Certain information and footnote disclosure normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to the Securities Exchange Commission rules and regulations governing form 10- Q. The condensed financial statements included in this report should be read in conjunction with the financial statements and notes thereto included in the Registrant's November 1, 1997 form 10-K annual report. 2. Inventories ----------- Inventories are carried at the lower of cost or market. Cost of finished home inventories is determined on the specific identification method. Other inventory costs are determined on a first-in, first-out basis. Inventories at May 2, 1998 and November 1, 1997 are summarized as follows: May 2, November 1, 1998 1997 ------ ----------- Raw Materials $ 550,509 $ 540,279 Work-in-process 63,175 75,022 Finished homes 6,665,303 6,501,759 Pre-owned manufactured homes 362,089 340,751 Model home furniture and other 586,424 583,660 ---------- ---------- $ 8,227,500 $ 8,041,471 ========== ========== 3. Earnings Per Share ------------------ Effective for the quarter ended January 31, 1998, the Company adopted FASB Statement on Accounting Standards No. 128, Earnings Per Share. The Statement simplifies the standards for computing earnings per share by replacing the presentation of primary earnings per share with a presentation of basic earnings per share. Prior years have been restated to reflect this change. The following reconciliation details the numerators and denominators used to calculate basic and diluted earnings per share for the respective periods:
Three Months Ended Six Months Ended ------------------ ---------------- May 2, May 3, May 2, May 3, 1998 1997 1998 1997 ------ ------ ------ ------ Net Income $ 1,008,345 $ 704,985 $ 1,808,657 $ 1,246,197 ========== ========== ========== ========== Weighted average shares outstanding Basic 4,456,251 4,456,251 4,456,251 4,456,251 Add: common stock equivalents 59,983 - 59,983 - ---------- ---------- ---------- ---------- Diluted 4,516,234 4,456,251 4,516,234 4,456,251 ========== ========== ========== ========== Earning per share: Basic $ 0.23 $ 0.16 $ 0.41 $ 0.28 ========== ========== ========== ========== $ 0.22 $ 0.16 $ 0.40 $ 0.28 ========== ========== ========== ==========
4. Three-for-two Stock Split ------------------------- On January 6, 1998, the Company declared a three-for-two stock split in the form of a stock dividend, payable on February 20, 1998 to shareholders of record as of January 30, 1998. Fiscal 1997 stock- holders' equity has been restated to give the retroactive recognition to the stock split in the prior period by reclassifying from additional paid-in-capital to common stock the par value of the 1,485,297 shares arising from the split. In addition, all references to per share amounts of the Company's common stock have been restated. NOBILITY HOMES, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION Results of Operations --------------------- Net sales for the three months ended May 2, 1998 increased 18 percent to $11,324,503 from $9,604,700 for the same period last year. Net sales for the six months also increased 18 percent to $21,930,468 from $18,650,692 a year ago. The increase in sales in 1998 was primarily due to the same store sales volume at the Company's Prestige Home Centers increasing 15 percent to $8,031,914 for the second quarter of 1998 from $6,960,955 for the same period last year and increasing 15 percent to $15,666,304 for the six months of 1998 from $13,626,527 for the same six month period last year. Gross profit, as a percentage of net sales, increased to 26.8 percent in the second quarter of 1998 from 25.9 percent for the same period last year. For the six months gross profit, as a percentage of net sales, increased to 26.2 percent as of May 2, 1998 from 25.3 percent for the same six month period last year. The increase in gross profit was primarily a result of improvements in the gross margins at both the manufacturing plants and retails sales centers. Selling, general and administrative expenses, as a percentage of net sales, declined to 13.3 percent in the second quarter of 1998 from 14.8 percent for the second quarter last year. For the six months selling, general and administrative expenses, as a percentage of net sales, declined to 13.7 percent as of May 2, 1998 from 14.9 percent for the same six month period last year. The decline in selling, general and administrative expenses as a percent of net sales was primarily due to a reduction in these expenses at the manufacturing plants. Other income for the second quarter of 1998 was $99,383 of which $72,826 was from interest on short term investments and $21,970 represented undistributed earnings from Nobility 21 a joint venture which provides financing to Prestige's retail customers. For the second quarter of 1997 other income was $68,433. For the six months other income was $192,236 of which $136,645 was from interest on short term investments and $47,822 was undistributed earnings from Nobility 21. For the same six month period last year other income was $93,812. As a result of the factors discussed above, net income for the second quarter of 1998 increased 43% to $1,008,345 or $.23 per share, compared to $704,985 or $.16 per share in 1997. For the six months ended May 2, 1998 net income increased 45% to $1,808,657 or $.41 per share, compared to $1,246,197 or $.28 per share as of May 3, 1997. Earnings per share for 1997 have been restated to reflect a three-for-two stock split in the form of a 50% stock dividend paid on February 20, 1998. Liquidity and Capital Resources ------------------------------- Cash and cash equivalents were $7,082,545 at May 2, 1998 compared to $6,293,924 as of November 1, 1997. Accounts receivable - trade increased to $1,257,968 at May 2, 1998 from an abnormally low $386,019 at November 1, 1997, but was down from $1,412,847 in second quarter ended May 3, 1997. The Company maintains a revolving credit agreement with a major bank providing for borrowings up to $2.5 million and a second revolving line of credit agreement with a major bank which provides for borrowings up to $1.5 million. These two agreements provide the Company with an additional $4.0 million of working capital for use in connection with its overall operations. At May 2, 1998 there were no amounts outstanding under these agreements. Consistent with normal practice, the Company's operations are not expected to require significant capital expenditures during fiscal 1998. Working capital requirements for the home inventory for new sales centers will be met with internal sources. Part II. Other Information And Signatures Item 1. There were no reportable events for item 1 through item 5. Item 6. Exhibits and Reports on Form 8-K Exhibit 27 Financial Data Schedule Signatures In accordance with Section 13 or 15(d) of the Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned, there unto duly authorized. NOBILITY HOMES, INC. DATE: June 5, 1998 By: /s/ Terry E. Trexler Terry E. Trexler, Chairman, President and Chief Executive Officer DATE: June 5, 1998 By: /s/ Thomas W. Trexler Thomas W. Trexler, Executive Vice President, Chief Financial Officer DATE: June 5, 1998 By: /s/ Lynn J. Cramer, Jr. Lynn J. Cramer, Jr., Treasurer and Principal Accounting Officer EX-27 2 EXHIBIT 27
5 THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED FINANCIAL STATEMENTS OF NOBILITY HOMES, INC. AS OF AND FOR THE QUARTER ENDED MAY 2, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 6-MOS OCT-31-1998 FEB-01-1998 MAY-02-1998 7,082,545 0 1,257,968 0 8,227,500 16,894,420 2,747,786 1,437,247 20,892,045 3,789,554 0 0 0 492,209 16,610,282 20,892,045 11,324,503 11,324,503 8,284,991 1,502,550 0 0 0 1,636,345 628,000 0 0 0 0 1,008,345 .23 .22
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