UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q
(Mark One)
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the quarterly period ended June 30, 2020
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the transition period from ___ to ___

Commission file number:    1-14445

graphic

HAVERTY FURNITURE COMPANIES, INC.
(Exact name of registrant as specified in its charter)

Maryland
  
58-0281900
(State or other jurisdiction of incorporation or organization)
  
(I.R.S. Employer Identification No.)
780 Johnson Ferry Road, Suite 800
Atlanta, Georgia
  
 
30342
(Address of principal executive offices)
  
(Zip Code)
(404) 443-2900
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934

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 (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 ⌧     No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ⌧   No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non‑accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer
☐
  
Accelerated filer
☒
  
Non-accelerated filer
☐
Smaller reporting company
☐
  
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. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  ☐     No ⌧

The numbers of shares outstanding of the registrant’s two classes of $1 par value common stock as of August 6, 2020, were:  Common Stock – 17,286,821; Class A Common Stock – 1,531,505.

HAVERTY FURNITURE COMPANIES, INC.
INDEX


  
Page No.
     
PART I.
FINANCIAL INFORMATION
  
     
 
Item 1.  Financial Statements
  
     
 
Condensed Consolidated Balance Sheets –
June 30, 2020 (unaudited) and December 31, 2019
1
     
 
Condensed Consolidated Statements of Comprehensive Income –
Six Months Ended June 30, 2020 and 2019 (unaudited)
2
     
 
Condensed Consolidated Statements of Cash Flows –
Six Months Ended June 30, 2020 and 2019 (unaudited)
3
     
 
 Notes to Condensed Consolidated Financial Statements (unaudited)
4
     
 
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
13
     
 
Item 3. Quantitative and Qualitative Disclosures about Market Risk
18
     
 
Item 4. Controls and Procedures
18
     
PART II.
OTHER INFORMATION
  
     
 
Item 1. Legal Proceedings
19
     
 
Item 1A. Risk Factors
19
     
 
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
20
     
 
Item 6. Exhibits
21


PART I.  FINANCIAL INFORMATION

Item 1.  Financial Statements

HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

  
June 30,
2020
    
December 31,
2019
  
   
(Unaudited)
        
Assets
            
Current assets
            
Cash and cash equivalents
  
$
151,055
    
$
75,739
  
Restricted cash and cash equivalents
    
6,709
      
6,663
  
Accounts receivable, net
    
1,141
      
1,527
  
Inventories
    
104,840
      
104,817
  
Prepaid expenses
    
10,302
      
7,652
  
Other current assets
    
8,960
      
8,125
  
Total current assets
    
283,007
      
204,523
  
Accounts receivable, long-term, net
    
128
      
195
  
Property and equipment, net
    
112,253
      
156,534
  
Right-of-use lease assets
    
234,046
      
175,474
  
Deferred income taxes
    
11,640
      
13,198
  
Other assets
    
10,035
      
10,148
  
Total assets
  
$
651,109
    
$
560,072
  
Liabilities and Stockholders’ Equity
                
Current liabilities
                
Accounts payable
  
$
22,803
    
$
27,830
  
Customer deposits
    
57,538
      
30,121
  
Accrued liabilities
    
45,733
      
39,654
  
Current lease liabilities
    
31,289
      
29,411
  
Total current liabilities
    
157,363
      
127,016
  
Noncurrent lease liabilities
    
206,918
      
149,594
  
Other liabilities
    
22,450
      
22,959
  
Total liabilities
    
386,731
      
299,569
  
                 
Stockholders’ equity
                
Capital Stock, par value $1 per share
                
Preferred Stock, Authorized – 1,000 shares; Issued:  None
    
     
 
Common Stock, Authorized – 50,000 shares; Issued: 2020 – 29,538; 2019 – 29,431
    
29,538
      
29,431
  
Convertible Class A Common Stock, Authorized – 15,000 shares; Issued: 2020 and 2019 – 2,054
    
2,054
      
2,054
  
Additional paid-in capital
    
94,581
      
93,208
  
Retained earnings
    
304,900
      
295,999
  
Accumulated other comprehensive loss
    
(2,027
)
    
(2,087
)
Less treasury stock at cost – Common Stock (2020 – 12,251; 2019 – 11,850 shares) and Convertible Class A Common Stock (2020 and 2019 – 522 shares)
    
(164,668
)
    
(158,102
)
Total stockholders’ equity
    
264,378
      
260,503
  
Total liabilities and stockholders’ equity
  
$
651,109
    
$
560,072
  

See notes to these condensed consolidated financial statements.
1

HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

   
Three Months Ended
June 30,
    
Six Months Ended
June 30,
  
(In thousands, except per share data - unaudited)
  
2020
    
2019
    
2020
    
2019
  
                         
Net sales
  
$
109,968
    
$
191,893
    
$
289,400
    
$
379,134
  
Cost of goods sold
    
50,322
      
88,336
      
130,201
      
172,494
  
Gross profit
    
59,646
      
103,557
      
159,199
      
206,640
  
Credit service charges
    
19
      
19
      
38
      
41
  
Gross profit and other revenue
    
59,665
      
103,576
      
159,237
      
206,681
  
                                 
Expenses:
                                
Selling, general and administrative
    
72,649
      
95,784
      
170,184
      
194,663
  
Provision for doubtful accounts
    
3
      
20
      
36
      
23
  
Other (income) expense, net
    
(31,812
)
    
(126
)
    
(31,895
)
    
(280
)
Total expenses
    
40,840
      
95,678
      
138,325
      
194,406
  
                                 
Income before interest and income taxes
    
18,825
      
7,898
      
20,912
      
12,275
  
Interest expense (income), net
    
200
      
(339
)
    
(13
)
    
(688
)
                                 
Income before income taxes
    
18,625
      
8,237
      
20,925
      
12,963
  
Income tax expense
    
4,985
      
2,191
      
5,466
      
3,295
  
Net income
  
$
13,640
    
$
6,046
    
$
15,459
    
$
9,668
  
                                 
Other comprehensive income
                                
Adjustments related to retirement plans; net of tax expense of $10 and $20 in 2020 and $3 and $6 in 2019
  
$
29
    
$
8
    
$
60
    
$
17
  
                                 
Comprehensive income
  
$
13,669
    
$
6,054
    
$
15,519
    
$
9,685
  
                                 
Basic earnings per share:
                                
Common Stock
  
$
0.73
    
$
0.30
    
$
0.82
    
$
0.48
  
Class A Common Stock
  
$
0.69
    
$
0.28
    
$
0.78
    
$
0.44
  
                                 
Diluted earnings per share:
                                
Common Stock
  
$
0.72
    
$
0.29
    
$
0.81
    
$
0.47
  
Class A Common Stock
  
$
0.69
    
$
0.27
    
$
0.78
    
$
0.44
  
                                 
Cash dividends per share:
                                
Common Stock
  
$
0.15
    
$
0.18
    
$
0.35
    
$
0.36
  
Class A Common Stock
  
$
0.14
    
$
0.17
    
$
0.33
    
$
0.34
  

See notes to these condensed consolidated financial statements.
2

HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands - unaudited)
  
Six Months Ended
June 30,
  
   
2020
    
2019
  
Cash Flows from Operating Activities:
            
Net income
  
$
15,459
    
$
9,668
  
Adjustments to reconcile net income to net cash provided by operating activities:
                
Depreciation and amortization
    
9,791
      
10,276
  
Share-based compensation expense
    
2,037
      
1,951
  
Gain from sale of land, property and equipment
    
(31,607
)
    
(4
)
Other
    
2,223
      
(1,262
)
Changes in operating assets and liabilities:
                
Inventories
    
(23
)
    
(3,373
)
Customer deposits
    
27,417
      
4,633
  
Operating lease assets and liabilities, net
    
629
      
2,863
  
Other assets and liabilities
    
(3,609
)
    
(5,431
)
Accounts payable and accrued liabilities
    
2,149
      
(4,481
)
Net cash provided by operating activities
    
24,466
      
14,840
  
                 
Cash Flows from Investing Activities:
                
Capital expenditures
    
(4,331
)
    
(7,768
)
Proceeds from sale of land, property and equipment
    
69,468
      
2,260
  
Net cash provided by (used in) investing activities
    
65,137
      
(5,508
)
                 
Cash Flows from Financing Activities:
                
Proceeds from borrowings under revolving credit facility
    
43,800
      
—
  
Payments of borrowings under revolving credit facility
    
(43,800
)
    
—
  
Net change in borrowings under revolving credit facility
    
—
      
—
  
                 
Dividends paid
    
(6,558
)
    
(7,285
)
Common stock repurchased
    
(6,810
)
    
(17,843
)
Other
    
(873
)
    
(1,328
)
Net cash used in financing activities
    
(14,241
)
    
(26,456
)
                 
Increase (decrease) in cash, cash equivalents and restricted cash equivalents during the period
    
75,362
      
(17,124
)
Cash, cash equivalents and restricted cash equivalents at beginning of period
    
82,402
      
79,809
  
Cash, cash equivalents and restricted cash equivalents at end of period
  
$
157,764
    
$
62,685
  

See notes to these condensed consolidated financial statements.
3
HAVERTY FURNITURE COMPANIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
NOTE A – Business and Basis of Presentation

Haverty Furniture Companies, Inc. (“Havertys,” “the Company,” “we,” “our,” or “us”) is a retailer of a broad line of residential furniture in the middle to upper-middle price ranges. We operate all of our stores using the Havertys brand and do not franchise our concept. We operate within a single reportable segment.  The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not include all information and footnotes required by United States of America generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. The Company believes that the disclosures made are adequate to make the information not misleading.  The financial statements include the accounts of the Company and its wholly-owned subsidiary.  All significant intercompany accounts and transactions have been eliminated in consolidation. We believe all adjustments, normal and recurring in nature, considered necessary for a fair presentation have been included. We suggest that these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying footnotes included in our latest Annual Report on Form 10-K.

The preparation of interim condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities, and reported amounts of revenue and expenses. Actual results could differ from those estimates.

The Company is subject to various claims and legal proceedings covering a wide range of matters that arise in the ordinary course of its business activities.  We believe that any liability that may ultimately result from the resolution of these matters will not have a material adverse effect on our financial condition, results of operations or cash flows.

Note B – COVID-19

In December 2019, a novel strain of coronavirus, subsequently named COVID-19, emerged from China and spread worldwide. The World Health Organization declared COVID-19 a pandemic and a national health emergency was declared by the United States beginning March 1, 2020. In response, many states and local governments began a series of restrictions on public gatherings, stay at home orders and advisories and quarantining of people who may have been exposed to the virus. In an effort to mitigate the spread of COVID-19 and protect our team members, customers, and communities, Havertys closed all of its stores on March 19 and halted deliveries on March 21, with the expectation at that time of reopening stores on April 2. Our stores remained closed during April and we reopened 103 locations on May 1 and the remaining 17 stores were reopened by June 20. We restarted our delivery operations on May 5.

The pandemic has resulted in significant economic disruption. Although our stores and other businesses are open or beginning to reopen there has been a resurgence in COVID-19 cases in several of our larger markets. We cannot reasonably estimate the impact on Havertys should the pandemic persist or worsen. Accordingly, the estimates and assumptions management made as of June 30, 2020 could change in subsequent interim reports and upon final determination at year-end, and it is reasonably possible that such changes could be significant (although the potential effects cannot be estimated at this time). The Company has evaluated subsequent events through the date the condensed consolidated financial statements covered by this quarterly report were issued.

4
HAVERTY FURNITURE COMPANIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
CARES Act

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") was signed into law. The CARES Act provides numerous tax provisions and other stimulus measures, including temporary suspension of certain payment requirements for the employer-paid portion of social security taxes, the creation of certain refundable employee retention credits, and technical corrections from prior tax legislation for tax depreciation of certain qualified improvement property. Havertys elected to defer the employer-paid portion of social security taxes beginning with pay dates on and after April 1, 2020. We recorded an estimate for refundable employee retention credits for eligible wages paid to employees during March 2020 affected by the cessation of our operations. Havertys recorded additional employee retention credits during the second quarter of 2020 for additional wages paid, primarily for health care benefits paid for employees furloughed in April 2020. We have also estimated a benefit from the technical correction for qualified leasehold improvements eligible for 100% tax bonus depreciation and adjusted our balances for deferred income taxes and income taxes receivable.

NOTE C – Stockholders’ Equity

The following outlines the changes in each caption of stockholders’ equity for the current and comparative periods and the dividends per share for each class of shares.

For the three months ended June 30, 2020:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at March 31, 2020
  
$
29,458
    
$
2,054
    
$
93,835
    
$
294,068
    
$
(2,056
)
  
$
(164,912
)
  
$
252,447
  
Net income
                            
13,640
                      
13,640
  
Dividends declared:
                                                        
Common Stock, $0.15 per share
                            
(2,593
)
                    
(2,593
)
Class A Common Stock, $0.14 per share
                            
(215
)
                    
(215
)
Restricted stock issuances
    
80
              
(634
)
                            
(554
)
Amortization of restricted stock
                    
1,064
                              
1,064
  
Directors’ Compensation Plan
                    
316
                      
244
      
560
  
Other comprehensive income
                                    
29
              
29
  
Balances at June 30, 2020
  
$
29,538
    
$
2,054
    
$
94,581
    
$
304,900
    
$
(2,027
)
  
$
(164,668
)
  
$
264,378
  

5
HAVERTY FURNITURE COMPANIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
For the six months ended June 30, 2020:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at December 31, 2019
  
$
29,431
    
$
2,054
    
$
93,208
    
$
295,999
    
$
(2,087
)
  
$
(158,102
)
  
$
260,503
  
Net income
                            
15,459
                      
15,459
  
Dividends declared:
                                                        
Common Stock, $0.35 per share
                            
(6,052
)
                    
(6,052
)
Class A Common Stock, $0.33 per share
                            
(506
)
                    
(506
)
Acquisition of treasury stock
                                            
(6,810
)
    
(6,810
)
Restricted stock issuances
    
107
              
(980
)
                            
(873
)
Amortization of restricted stock
                    
2,037
                              
2,037
  
Directors’ Compensation Plan
                    
316
                      
244
      
560
  
Other comprehensive income
                                    
60
              
60
  
Balances at June 30, 2020
  
$
29,538
    
$
2,054
    
$
94,581
    
$
304,900
    
$
(2,027
)
  
$
(164,668
)
  
$
264,378
  

For the three months ended June 30, 2019:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at March 31, 2019
  
$
29,113
    
$
2,280
    
$
91,888
    
$
289,126
    
$
(1,456
)
  
$
(129,025
)
  
$
281,926
  
Net income
                            
6,046
                      
6,046
  
Dividends declared:
                                                        
Common Stock, $0.18 per share
                            
(3,338
)
                    
(3,338
)
Class A Common Stock, $0.17 per share
                            
(261
)
                    
(261
)
Acquisition of treasury stock
                                            
(17,843
)
    
(17,843
)
Restricted stock issuances
    
83
              
(878
)
                            
(795
)
Class A conversion
    
222
      
(222
)
                                    
—
  
Amortization of restricted stock
                    
890
                              
890
  
Directors’ Compensation Plan
                    
(53
)
                    
680
      
627
  
Other comprehensive income
                                    
8
              
8
  
Balances at June 30, 2019
  
$
29,418
    
$
2,058
    
$
91,847
    
$
291,573
    
$
(1,448
)
  
$
(146,188
)
  
$
267,260
  

6
HAVERTY FURNITURE COMPANIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
For the six months ended June 30, 2019:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at December 31, 2018
  
$
29,079
    
$
2,280
    
$
91,394
    
$
282,366
    
$
(1,465
)
  
$
(129,025
)
  
$
274,629
  
Net income
                            
9,668
                      
9,668
  
Dividends declared:
                                                        
Common Stock, $0.36 per share
                            
(6,725
)
                    
(6,725
)
Class A Common Stock, $0.34 per share
                            
(560
)
                    
(560
)
Acquisition of treasury stock
                                            
(17,843
)
    
(17,843
)
Restricted stock issuances
    
117
              
(1,445
)
                            
(1,328
)
Class A conversion
    
222
      
(222
)
                                    
—
  
Amortization of restricted stock
                    
1,951
                              
1,951
  
Directors’ Compensation Plan
                    
(53
)
                    
680
      
627
  
Other comprehensive income
                                    
17
              
17
  
Cumulative effect adjustment
                            
6,824
                      
6,824
  
Balances at June 30, 2019
  
$
29,418
    
$
2,058
    
$
91,847
    
$
291,573
    
$
(1,448
)
  
$
(146,188
)
  
$
267,260
  

NOTE D – Interim LIFO Calculations

We calculate the LIFO index annually. Accordingly, interim LIFO calculations must necessarily be based on management’s estimates of inventory levels and inflation rates. Since these estimates may be affected by factors beyond management’s control, interim results are subject to change based upon the final year-end LIFO inventory valuations.

NOTE E – Fair Value of Financial Instruments

The fair values of our cash and cash equivalents, restricted cash and cash equivalents, accounts receivable, accounts payable and customer deposits approximate their carrying values due to their short-term nature. The assets related to our self-directed, non-qualified deferred compensation plans for certain executives and employees are valued using quoted market prices multiplied by the number of shares held, a Level 1 valuation technique. The assets related to our deferred compensation plans totaled approximately $7.4 million at June 30, 2020 and $7.5 million at December 31, 2019 and are included in other assets. The related liabilities of the same amounts are included in other liabilities.

7
HAVERTY FURNITURE COMPANIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
NOTE F – Credit Agreement

On May 15, 2020 we entered into the Third Amendment to Amended and Restated Credit Agreement (as amended, the “Credit Agreement”) with a bank to permit certain sale-leaseback transactions as more fully described in Note L. Our first borrowings under the facility, since its origination in 2008, were in March 2020.

The Credit Agreement is a $60.0 million revolving credit facility secured by our inventory, accounts receivable, cash, and certain other personal property and matures on September 27, 2024. Availability fluctuates based on a borrowing base calculation reduced by outstanding letters of credit. Amounts available to borrow are based on the lesser of the borrowing base or the $60.0 million-line amount. The credit facility contains covenants that, among other things, limit our ability to incur certain types of debt or liens, enter into mergers and consolidations or use proceeds of borrowing for other than permitted uses. The covenants also limit our ability to pay dividends if unused availability is less than $12.5 million.

We borrowed $43.8 million under the Credit Agreement in March 2020 and repaid the borrowings in June 2020. The interest rates on the outstanding balance was based on the three-month Euro dollar LIBOR rate plus 1.25% and on a weighted average basis was approximately 2.37%. Total interest paid under the Credit Agreement was $0.3 million for the three months ended June 30, 2020.

The borrowing base was $42.9 million at June 30, 2020, there were no outstanding letters of credit, and the net availability was $42.9 million.

Note G – Revenues

We recognize revenue at delivery. Havertys does not have a loyalty program or sell gift certificates or gift cards. We also do not offer coupons for redemption for future purchases, such as those other retailers might issue for general marketing purposes or in conjunction with prior purchases.

The following table presents our revenues disaggregated by each major product category and service (dollars in thousands, amounts and percentages may not always add due to rounding):

 
Three Months Ended June 30,
    
Six Months Ended June 30,
  
   
2020
    
2019
    
2020
    
2019
  
(In thousands)
  
Net
Sales
    
% of
Net Sales
    
Net
Sales
    
% of
Net Sales
    
Net
Sales
    
% of
Net Sales
    
Net
Sales
    
% of
Net Sales
  
Merchandise:
                                                
Case Goods
                                                
Bedroom Furniture
  
$
19,284
      
17.5
%
  
$
31,417
      
16.4
%
  
$
46,928
      
16.2
%
  
$
61,937
      
16.3
%
Dining Room Furniture
    
12,852
      
11.7
      
20,265
      
10.6
      
31,074
      
10.7
      
39,862
      
10.5
  
Occasional
    
11,199
      
10.2
      
14,568
      
7.6
      
27,450
      
9.5
      
30,945
      
8.2
  
     
43,335
      
39.4
      
66,251
      
34.5
      
105,452
      
36.4
      
132,744
      
35.0
  
Upholstery
    
44,455
      
40.4
      
77,146
      
40.2
      
118,084
      
40.8
      
150,178
      
39.6
  
Mattresses
    
10,377
      
9.4
      
21,976
      
11.5
      
29,195
      
10.1
      
43,234
      
11.4
  
Accessories and Other(1)
    
11,800
      
10.7
      
26,520
      
13.8
      
36,669
      
12.7
      
52,978
      
14.1
  
   
$
109,968
      
100.0
%
  
$
191,893
      
100.0
%
  
$
289,400
      
100.0
%
  
$
379,134
      
100.0
%

(1)
 Includes delivery charges and product protection.

8
HAVERTY FURNITURE COMPANIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
NOTE H – Leases

We have operating leases for offices, warehouses, and certain equipment. Our leases have remaining lease terms of 1 year to 15 years, some of which include options to extend the leases for up to 20 years. We determine if an arrangement is or contains a lease at lease inception. Our leases do not have any residual value guarantees or any restrictions or covenants imposed by lessors. We have lease agreements for real estate with lease and non-lease components, which are accounted for separately.

Certain of our lease agreements for retail stores include variable lease payments, generally based on sales volume.  The variable portion of payments are not included in the initial measurement of the right-of-use asset or lease liability due to uncertainty of the payment amount and are recorded as lease expense in the period incurred. Certain of our equipment lease agreements include variable lease costs, generally based on usage of the underlying asset (mileage, fuel, etc.). The variable portion of payments are not included in the initial measurement of the right-of-use asset or lease liability due to uncertainty of the payment amount and are recorded in the period incurred.

As of June 30, 2020, we have entered into two leases for additional retail locations which have not yet commenced. One of these locations is under construction.

Lease expense is charged to selling, general and administrative expenses. Components of lease expense were as follows (in thousands):

 
Three Months Ended June 30,
    
Six Months Ended June 30,
  
   
2020
    
2019
    
2020
    
2019
  
Operating lease cost
  
$
11,083
    
$
10,465
    
$
21,515
    
$
20,693
  
Short-term lease cost
    
—
      
30
      
—
      
40
  
Variable lease cost
    
584
      
1,281
      
2,198
      
2,812
  
Total lease expense
  
$
11,667
    
$
11,776
    
$
23,713
    
$
23,545
  

Supplemental cash flow information related to leases is as follows (in thousands):

 
Six Months Ended June 30,
  
   
2020
    
2019
  
Cash paid for amounts included in the measurement of lease liabilities:
            
Operating cash flows from operating leases
  
$
14,028
    
$
20,085
  
Right-of-use assets obtained in exchange for lease obligations:
                
Operating leases
  
$
77,772
    
$
22,519
  

In April 2020, the Financial Accounting Standards Board issued guidance allowing entities to make a policy election to account for lease concessions related to the COVID-19 pandemic as though enforceable rights and obligations for those concessions existed. The election applies to any lessor-provided lease concession related to the impact of the COVID-19 pandemic, provided the concession does not result in a substantial increase in the rights of the lessor or in the obligations of the lessee. During the three months ended June 30, 2020, we have received concessions from certain landlords in the form of rent deferrals and abatements. We have elected to account for these rent concessions as though enforceable rights and obligations for those concessions existed in the original lease agreements and have recorded a non-interest bearing payable for the deferred rent payments. The recognition of rent concessions did not have a material impact on our condensed consolidated financial statements as of June 30, 2020.

NOTE I – Income Taxes

Our effective tax rate for the six months ended June 30, 2020 and 2019 was 26.1% and 25.4%, respectively. The primary difference in the effective rate and the statutory rate is due to state income taxes and additional tax expense from vested stock awards.

9
HAVERTY FURNITURE COMPANIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
NOTE J – Stock Based Compensation Plan

As more fully discussed in Note 14 of the notes to the consolidated financial statements in our 2019 Annual Report on Form 10-K, we have awards outstanding for Common Stock under stock-based employee compensation plans.

The following table summarizes our award activity during the six months ended June 30, 2020:

 
Service-Based
Restricted Stock Awards
    
Performance-Based
Restricted Stock Awards
    
Stock-Settled
Appreciation Rights
  
   
Shares or Units (#)
    
Weighted-Average
Award Price ($)
    
Shares or Units (#)
    
Weighted-Average
Award Price ($)
    
Rights (#)
    
Weighted-Average
Award Price ($)
  
Outstanding at December 31, 2019
    
234,810
      
20.93
      
214,809
      
21.38
      
7,500
      
18.14
  
Granted/Issued
    
145,375
      
20.42
      
120,727
      
20.42
      
—
          
Awards vested or rights exercised(1)
    
(122,114
)
    
20.62
      
(44,875
)
    
22.12
      
(7,500
)
    
18.14
  
Forfeited
    
(4,750
)
    
20.40
      
(76,493
)
    
20.29
      
—
      
—
  
Outstanding at June 30, 2020
    
253,321
      
20.79
      
214,168
      
21.08
      
—
      
—
  
Restricted Units expected to vest
    
253,321
      
20.79
      
188,372
      
21.15
      
—
      
—
  

(1)
Includes shares repurchased from employees for employee’s tax liability.

The aggregate intrinsic value of outstanding service-based restricted stock awards was $4.1 million at June 30, 2020. The restrictions on the service-based awards generally lapse or vest annually, primarily over four-year and three-year periods.

The total fair value of performance-based restricted stock awards that vested during the six months ended June 30, 2020 was $1.0 million. The aggregate intrinsic value of outstanding performance awards at June 30, 2020 expected to vest was $3.0 million. The performance awards are based on one-year performance periods but cliff vest in approximately three years from grant date.

The fair value for stock-settled appreciation rights were estimated at the date of grant using a Black Scholes pricing model. The total intrinsic value of stock-settled appreciation rights exercised during the six months ended June 30, 2020 was $18,000.

The compensation for all awards is charged to selling, general and administrative expense over the respective grants’ vesting periods, primarily on a straight-line basis. The amount charged was approximately $2.0 million for the six months ended June 30, 2020 and 2019. Forfeitures are recognized as they occur. As of June 30, 2020, the total compensation cost related to unvested equity awards was approximately $6.6 million and is expected to be recognized over a weighted-average period of 2.3 years.

NOTE K – Earnings Per Share

We report our earnings per share using the two-class method.  The income per share for each class of common stock is calculated assuming 100% of our earnings are distributed as dividends to each class of common stock based on their contractual rights.

The Common Stock of the Company has a preferential dividend rate of at least 105% of the dividend paid on the Class A Common Stock. The Class A Common Stock, which has ten votes per share as opposed to one vote per share for the Common Stock (on all matters other than the election of directors), may be converted at any time on a one-for-one basis into Common Stock at the option of the holder of the Class A Common Stock.
10
HAVERTY FURNITURE COMPANIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

 
Three Months Ended
June 30,
    
Six Months Ended
June 30,
  
   
2020
    
2019
    
2020
    
2019
  
Numerator:
                        
Common:
                        
Distributed earnings
  
$
2,593
    
$
3,338
    
$
6,052
    
$
6,725
  
Undistributed earnings
    
9,987
      
2,260
      
8,211
      
2,194
  
Basic
    
12,580
      
5,598
      
14,263
      
8,919
  
Class A Common earnings
    
1,060
      
448
      
1,196
      
749
  
Diluted
  
$
13,640
    
$
6,046
    
$
15,459
    
$
9,668
  
                                 
Class A Common:
                                
Distributed earnings
  
$
215
    
$
261
    
$
506
    
$
560
  
Undistributed earnings
    
845
      
187
      
690
      
189
  
   
$
1,060
    
$
448
    
$
1,196
    
$
749
  
Denominator:
                                
Common:
                                
Weighted average shares outstanding - basic
    
17,245
      
18,642
      
17,353
      
18,716
  
Assumed conversion of Class A Common Stock
    
1,532
      
1,621
      
1,532
      
1,689
  
Dilutive options, awards and common stock equivalents
    
208
      
279
      
241
      
318
  
                                 
Total weighted-average diluted Common Stock
    
18,985
      
20,542
      
19,126
      
20,723
  
                                 
Class A Common:
                                
Weighted average shares outstanding
    
1,532
      
1,621
      
1,532
      
1,689
  
                                 
Basic earnings per share:
                                
Common Stock
  
$
0.73
    
$
0.30
    
$
0.82
    
$
0.48
  
Class A Common Stock
  
$
0.69
    
$
0.28
    
$
0.78
    
$
0.44
  
                                 
Diluted earnings per share:
                                
Common Stock
  
$
0.72
    
$
0.29
    
$
0.81
    
$
0.47
  
Class A Common Stock
  
$
0.69
    
$
0.27
    
$
0.78
    
$
0.44
  

11
HAVERTY FURNITURE COMPANIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
NOTE L – Sale and Leaseback Transaction

On May 18, 2020, Havertys completed a sale and leaseback transaction of three properties.  The Coppell, Texas location has approximately 394,000 distribution square feet used to serve our western stores, 44,000 retail square feet, and 20,000 square feet of office space for call center and general management purposes. The Lakeland, Florida facility has approximately 335,000 distribution square feet, and the Colonial Heights, Virginia facility has approximately 129,000 distribution square feet.

The total purchase price for the three properties, excluding costs and taxes, was $70.0 million and the net book value was $37.9 million.  We recorded a gain of $31.6 million in May 2020 which is included in other income.

The three properties were leased back to Havertys under 15-year operating lease agreements with renewal options.

The following is a schedule of the future minimum lease payments under the lease agreements  for the three properties for each of the next five periods ending December 31 and thereafter (in thousands):

Six months ended December 31, 2020
  
$
2,191
  
Year ended December 31, 2021
    
4,434
  
Year ended December 31, 2022
    
4,523
  
Year ended December 31, 2023
    
4,613
  
Year ended December 31, 2024
    
4,706
  
Subsequent to 2024
    
54,966
  
Total future minimum lease payments
  
$
75,433
  


12

Item 2.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the unaudited condensed consolidated financial statements and accompanying notes contained herein and with the audited consolidated financial statements, accompanying notes, related information and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2019.

Forward-Looking Statements

Some statements in this quarterly report on Form 10-Q constitute forward-looking statements that are subject to the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. 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. Senior officers may also make verbal statements to analysts, investors, the media and others that are forward-looking. These forward-looking statements include, without limitation, our expected ability to operate and protect our team members and customers during the COVID-19 pandemic, the execution and effect of our cost savings initiatives, our efforts and initiatives to help us emerge from the pandemic well-positioned, and our liquidity position to continue to operate during these highly uncertain times.

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. Actual results or events may differ materially from those indicated as a result of various important factors. Such factors may include, among other things, the extent and duration of the disruption to our business operations caused by the health crisis associated with the COVID-19 pandemic, including the effects on the financial health of our business partners and customers, on supply chains and our suppliers, and on access to capital and liquidity provided by the financial and capital markets; our ability to maintain compliance with debt covenants and amend such credit facilities as necessary; disruptions in our suppliers' operations, including from the impact of COVID-19, including potential problems with inventory availability and the potential result of the volatility or higher cost of product and international freight due to the high demand of products and low supply for an unpredictable period of time; disruptions in our third-party producers’ operations in foreign countries; 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 herein and in the Company's Annual Report on Form 10-K for 2019 (all of which risks may be amplified by the COVID-19 pandemic) and Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2020 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.

13

Item 2.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

Impact of COVID-19 on Our Business

The COVID-19 pandemic has resulted in significant economic disruption and adversely impacted our business. We closed our stores and ceased delivery operations in the second half of March. Affected team members were paid during this period and most corporate personnel transitioned to working remotely. On April 1, we extended our store closure for another 30 days and furloughed 3,033 team members or approximately 87% of our workforce. During this period, we paid the cost of enrolled health benefits of those furloughed. Given the dramatic shock to the economy caused by the pandemic and uncertainty of the ongoing impact, we made a permanent reduction in our workforce of approximately 1,200 team members effective April 30 and extended the furlough of approximately 730 team members until June 1. We reopened 103 of our stores on May 1 and the remaining 17 were opened by June 20 and deliveries began on May 5. As we restart all aspects of our operations, we continue to work closely with local authorities and follow the guidance of the Centers for Disease Control and Prevention (“CDC”), implementing enhanced cleaning measures, social distancing, and the utilization of face masks for the safety of team members, customers, and communities.

We have taken several steps to strengthen our financial position and maintain financial flexibility by reviewing operating expenses, evaluating merchandise purchases, reducing capital expenditures,  temporarily borrowing $43.8 million on our credit facility (which has since been repaid), and completing a $70.0 million sale-leaseback transaction in May.

As the COVID-19 pandemic is complex and rapidly evolving, the Company's plans as described in this report may change. At this point, we cannot reasonably estimate the duration and severity of this pandemic and its impact on our business, results of operations, financial position and cash flows.

Net Sales

Our sales are generated by customer purchases of home furnishings. Revenue is recognized upon delivery to the customer.

Comparable-store or “comp-store” sales for the periods presented are sales made on our website and from stores open throughout the period and the corresponding prior year period.  If a store expansion results in a 10% or greater increase in selling square footage, its sales are removed from the comparable store sales base until it has been open a full 12 months. Accordingly, our comp-store sales may not be comparable to other entities. The computation of comp-store sales for the first and second quarters of 2020 and six months ended June 30, 2020 is not meaningful (“NM”) since all stores were closed for a period of time during these periods.

The following outlines our sales and comp-store sales increases and decreases for the periods indicated (dollars in millions, amounts and percentages may not always add to totals due to rounding):

  
2020
  
2019
   
Net Sales
  
Comp-Store Sales
  
Net Sales
  
Comp-Store Sales
Period
  
Total Dollars
  
%
 Change
  
$
Change
  
%
Change
  
$
Change
  
Total Dollars
  
%
 Change
  
$
Change
  
%
 Change
  
$
Change
Q1
  
$179.4
  
(4.2)%
  
$ (7.8)
  
NM
  
NM
  
$187.2
  
(6.1)%
  
$(12.2)
  
(4.7)%
  
$  (9.2)
Q2
  
$110.0
  
(42.7)%
  
$(81.9)
  
NM
  
NM
  
$191.9
  
(3.5)%
  
$ (6.9)
  
(2.3)%
  
$  (4.5)
First Half
  
$289.4
  
(23.7)%
  
$(89.7)
  
NM
  
NM
  
$379.1
  
(4.8)%
  
$(19.1)
  
(3.5)%
  
$(13.7)

14

Item 2.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

We closed our stores on March 19 and ceased delivery operations on March 21. Most stores reopened on May 1 and total written sales for the two months ended June 30, 2020 were up 13.9% and written comparable store sales were up 17.5% compared to the same two-month period in 2019.  Deliveries resumed on May 5 with reduced personnel and capacity and total sales from May 5 through June 30, 2020 were down 13.4% compared with the same period of 2019.

Our delivery capacity was reduced as part of our business continuity plan. The pace of our written business since reopening has lengthened the time between customer orders and delivery. We are working to adjust our operations to restore our previous delivery time frames.

Gross Profit

Gross profit for the second quarter of 2020 was 54.2%, up 20 basis points compared to the prior year period of 54.0%. The increase is primarily due to merchandise pricing and mix, and reductions in inventory markdowns. Gross profit for the first half of 2020 was 55.0% compared to 54.5% for the same period of 2019.

We are not providing guidance at this time as to our estimated gross profit margins for the remainder of 2020.

Substantially all of our occupancy and home delivery costs are included in selling, general and administrative expenses (“SG&A”) as are 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.

Selling, General and Administrative Expenses

Our SG&A costs for the second quarter reflect the impact of our stores being closed in April and the operational changes implemented under our business continuity plan. SG&A dollars decreased $23.1 million for the second quarter of 2020 and $24.5 million for the six months ended June 30, 2020 compared to the same prior year periods.

During April, virtually all team members in our store and distribution operations were furloughed and warehouse and corporate office personnel were furloughed to a minimum level for necessary operations. We covered the health benefits premiums for those furloughed which totaled approximately $2.1 million. Salaries and wages associated with the furloughed team members was approximately $9.9 million.

We reduced our workforce by approximately 35% effective April 30 and paid severance costs of approximately $1.7 million. The annualized compensation costs related to this reduction in personnel is approximately $42.6 million. We are analyzing our staffing needs and accelerating hiring in our delivery operations due to the pace of our business since reopening.

We classify our SG&A expenses as either variable or fixed and discretionary.  Our variable expenses include the costs in the selling and delivery categories and certain warehouse expenses as these amounts will generally move in tandem with our level of sales. The remaining categories and expenses for occupancy, advertising, and administrative costs are classified as fixed and discretionary because these costs do not fluctuate with sales.

15

Item 2.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following table outlines our SG&A expenses by classification:

  
Three Months Ended June 30,
    
Six Months Ended June 30,
  
   
2020
    
2019
    
2020
    
2019
  
(In thousands)
        
% of Net Sales
          
% of Net Sales
          
% of Net Sales
          
% of Net Sales
  
Variable
  
$
20,594
      
18.7
%
  
$
35,224
      
18.4
%
  
$
56,067
      
19.4
%
  
$
70,306
      
18.5
%
Fixed and discretionary
    
52,055
      
47.3
      
60,560
      
31.6
      
114,117
      
39.4
      
124,357
      
32.8
  
   
$
72,649
      
66.1
%
  
$
95,784
      
49.9
%
  
$
170,184
      
58.8
%
  
$
194,663
      
51.3
%

The variable expenses were higher as a percentage of sales in the second quarter of 2020 primarily due to severance costs and the payment of health benefits for furloughed team members. The variable expenses were higher as a percentage of sales for the six months period of 2020 due to our payment of approximately $4.3 million in wages during the last weeks of March when stores were closed and deliveries were halted. We have offset a portion of the wages and health benefits costs with an expected recovery via the CARES Act as described in Note B of the Notes to the Condensed Consolidated Financial Statements.

Fixed and discretionary expenses were impacted in the second quarter by the reductions in compensation costs discussed above and lower advertising spending of $3.5 million as compared to the prior year quarter. Reductions in these categories were the primary drivers of the reductions for the six months ended June 30.

We are not providing guidance at this time as to our estimated SG&A costs for the remainder of 2020.

Liquidity and Capital Resources
Historically, our primary cash requirements were for working capital needs, contractual obligations, income tax liabilities, capital expenditures, payment of dividends, and share repurchases and were funded primarily through cash generated from operations.

As business slowed and we closed our stores in March, we proactively implemented several actions to reduce cash outlays and expenses and enhance our liquidity position and financial flexibility. We drew $43.8 million on our $60.0 million credit facility in late March as a proactive measure given the uncertain environment and repaid these borrowings in late June. Refer to Note F of the Notes to the Condensed Consolidated Financial Statements. We worked with our landlords on rent deferrals and we delayed non-essential capital projects and new store openings where possible.

On May 18, 2020 we entered into a sale-leaseback transaction which provided an additional $70.0 million in gross proceeds. Refer to Note L of the Notes to the Condensed Consolidated Financial Statements for additional information concerning this transaction.

We believe that we have sufficient liquidity to finance our operations and expected capital requirements for at least 12 months should we need to reinstitute our business continuity plan. We will continue to monitor our liquidity closely given the volatility created by the COVID-19 pandemic.

16

Item 2.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

Summary of Cash Activities

Our cash flows provided by operations was $24.5 million in the first six months of 2020 compared to $14.8 million for the same period of 2019. This increase was primarily due to larger increases in customer deposits in 2020 versus 2019 and increases in accrued liabilities in 2020 versus decreases in 2019. For additional information about the changes in our assets and liabilities refer to our Balance Sheet Changes discussion below.

Our cash flows provided by investing activities totaled $65.1 million in the first six months of 2020 versus $5.5 million used in investing net activities for the same period of 2019. This increase in 2020 was primarily due to $69.5 million in net proceeds from our sale-leaseback transaction partly offset by higher capital expenditures in 2019 compared to 2020.

Financing activities used cash of $14.2 million in the first six months of 2020 compared to a use of cash of $26.5 million for the same period of 2019. This difference was primarily due to common stock purchases of $6.8 million in 2020 versus $17.5 million in 2019.

Balance Sheet Changes for the Six Months Ended June 30, 2020

Our balance sheet as of June 30, 2020, as compared to our balance sheet as of December 31, 2019, changed as follows:

•
increase in cash and cash equivalents of $75.3 million primarily due to the $69.5 million of net proceeds from the sale-leaseback transaction;
•
increase in prepaid expenses of $2.7 million primarily related to refundable income taxes paid for prior years;
•
decrease in property and equipment, net of $44.3 million primarily due to the sale-leaseback of three warehouse facilities;
•
increase in right-of-use lease assets of $58.6 million primarily due to the sale-leaseback of three warehouse facilities;
•
decrease in accounts payable of $5.0 million primarily due to decreases for amounts owed for merchandise and advertising;
•
increase in customer deposits of $27.4 million due to an increase in undelivered sales;
•
increase in accrued liabilities of $6.1 million resulting primarily from increases for current year income taxes and deferred rent payments offset by reductions for accrued advertising; and
•
increase of $59.2 million of lease liabilities due to the sale-leaseback transaction.

17

Item 2.   Management’s Discussion and Analysis of Financial Condition and Results of Operations

Store Plans and Capital Expenditures
Location
Opening Quarter
Actual or Planned
Category
Atlanta, GA
Q-1-20
Closure
Dallas, TX
Q-3-20
Closure
Dallas/Ft. Worth, TX
Q-3-20
Open
Myrtle Beach, SC
Q-1-21
Open-New Market

Net selling space in 2020 is expected to be slightly down compared to 2019.  Total capital expenditures are estimated to be $9.2 million in 2020 depending on the timing of spending for new projects.
Off-Balance Sheet Arrangements
As of June 30, 2020, we had no off-balance sheet arrangements or obligations.
Critical Accounting Estimates
Critical accounting estimates are those that we believe are both significant and that require us to make difficult, subjective or complex judgments, often because we need to estimate the effect of inherently uncertain matters. We base our estimates and judgments on historical experiences and various other factors that we believe to be appropriate under the circumstances. Actual results may differ from these estimates, and we might obtain different estimates if we used different assumptions or conditions. Our critical accounting estimates are identified and described in our annual report on Form 10-K for the year ended December 31, 2019. We had no significant changes in those critical accounting estimates since our last annual report.

Item 3.  Quantitative and Qualitative Disclosures about Market Risk
For quantitative and qualitative disclosures about market risk, see Item 7A, ‘Quantitative and Qualitative Disclosures About Market Risk,’ of our annual report on Form 10-K for the year ended December 31, 2019. Our exposure to market risk has not changed materially since  December 31, 2019.

Item 4.  Controls and Procedures
As of the end of the period covered by this report, an evaluation was performed under the supervision and with the participation of our management, including the Chief Executive Officer (CEO) and Chief Financial Officer (CFO), of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based on that evaluation, our management, including the CEO and CFO, concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this report to provide reasonable assurance that information required to be disclosed in the reports the Company files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to our management, including the CEO and CFO, as appropriate, to allow timely decisions regarding disclosure.

There have been no changes in the Company’s internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rule 13a-15 that occurred during the Company’s fiscal quarter ended June 30, 2020 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. As a result of the COVID-19 pandemic, team members have shifted to a rotating work from home and office environment. We have reviewed our financial reporting process to provide reasonable assurance that we could report our financial results accurately and timely, and we will continue to evaluate the impact of any related changes to our internal control over financial reporting.

18

PART II.  OTHER INFORMATION

Item 1.  Legal Proceedings

Information regarding legal proceedings is described under the subheading “Business and Basis of Presentation” in Note A of the Notes to the Condensed Consolidated Financial Statements set forth in this Form 10-Q.

Item 1A.  Risk Factors

In addition to the other information set forth in this report, including the risk factor set forth below, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2019, which could materially affect our business, financial condition or future results.

In December 2019, a novel strain of coronavirus, now labeled COVID-19 was detected in China and has now spread globally. The COVID-19 outbreak was declared a national health emergency by the United States effective March 1, 2020. Federal, state and local governments, and businesses have implemented significant actions in an effort to mitigate this public health crisis. Although the ultimate severity of the COVID-19 pandemic is uncertain at this time, the pandemic has had, and will continue to have, adverse impacts on the Company's financial condition and results of operations, including, but not limited to:

•
We closed all of our 120 stores on March 19 in response to the COVID-19 pandemic with the expectation to reopen on April 1.
•
On April 1, we extended our store closure for another 30 days and furloughed 3,033 team members or approximately 87% of our workforce. Given the dramatic shock to the economy caused by the pandemic and uncertainty of the ongoing impact, we made a permanent reduction in our workforce of approximately 1,200 team members effective April 30 and extended the furlough of approximately 730 team members until June 1.
•
We opened 103 stores on May 1 and the remaining 17 were opened by June 20.
•
Health concerns, social distancing measures or changes in consumer spending behaviors due to COVID-19 may continue to impact traffic in our stores as they resume operations  and if customers do not perceive our response to be adequate or appropriate, we could suffer damage to our reputation and brand, which could adversely affect our business in the future. These items could have a material impact on our sales and profits and could lead to higher third-party financing costs and asset impairment charges, among other things.
•
We may incur significant additional costs to ensure we meet the needs of our team members and customers, including additional cleanings of our stores and other facilities.
•
The demand by our customers is likely to be volatile due to their concerns over their actual or perceived financial condition.
•
We have experienced temporary or long-term disruptions in our supply chain, as the pandemic has resulted in travel disruptions and has impacted manufacturing and distribution throughout the world. The receipt of merchandise sourced from impacted areas has been slowed or disrupted and our merchandise suppliers are expected to face similar challenges in receiving materials and fulfilling our orders. Furthermore, transportation delays and cost increases, more extensive travel restrictions, closures or disruptions of businesses and facilities or social, economic, political or labor instability in the affected areas, may impact our or our suppliers' operations.

19


•
We may be required to change our plans for inventory receipts which would place financial pressure on our merchandise suppliers. Such actions may negatively impact our relationships with our merchandise suppliers or adversely impact their financial performance and position. If this occurs, our current merchandise suppliers’ ability to meet their obligations to us may be impacted or we may also be required to establish new relationships with new merchandise suppliers.
•
Our liquidity has been negatively impacted and will be subject to further negative impact as long as our stores are not able to sustain normal operations. We may be required to pursue additional sources of financing to meet our financial obligations. Obtaining such financing is not guaranteed and is largely dependent upon market conditions and other factors.
•
The extent of the impact of the COVID-19 pandemic on our operations and financial results depends on future developments and is highly uncertain due to the unknown duration and severity of the pandemic. The situation is changing rapidly, and future impacts may materialize that are not yet known.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

The board of directors has authorized management, at its discretion, to purchase and retire limited amounts of our common stock and Class A common stock. A program was initially approved by the board on November 3, 1986 with subsequent authorizations made as to the number of shares to be purchased or amount to be purchased in total dollars. No purchases were made during the quarter ended June 30, 2020. The balance of the current authorization for purchases was approximately $29.7 million at June 30, 2020.

20

Item 6.          Exhibits


(a)  Exhibits

The exhibits listed below are filed with or incorporated by reference into this report (those filed with this report are denoted by an asterisk). Unless otherwise indicated, the exhibit number of documents incorporated by reference corresponds to the exhibit number in the referenced documents.

Exhibit Number
  
Description of Exhibit (Commission File No. 1-14445)
3.1
  
3.2
  
By-laws of Haverty Furniture Companies, Inc. as amended and restated effective May 8, 2018 (Exhibit 3.1 to our Current Report on form 8-K dated May 10, 2018).
10.1
  
Amended and Restated Credit Agreement by and among Haverty Furniture Companies, Inc. and Havertys Credit Services, Inc., as the Borrowers, SunTrust Bank, as the Issuing Bank and Administrative Agent and SunTrust Robinson Humphrey, Inc. as Lead Arranger, dated September 1, 2011 (Exhibit 10.1 to our 2011 Third Quarter Form 10-Q). First Amendment to Amended and Restated Credit Agreement, dated March 31, 2016 (Exhibit 10.1 to our 2016 First Quarter Form 10‑Q): Second Amendment to Amended and Restated Credit Agreement by and among Haverty Furniture Companies, Inc. and Havertys Credit Services, Inc., as the Borrowers, and SunTrust Bank, as the Issuing Bank and Administrative Agent (Exhibit 10.1 to our 2019 Third Quarter Form 10-Q). Third Amendment to Amended and Restated Credit Agreement by and among Haverty Furniture Companies, Inc. and Havertys Credit Services, Inc., as Borrowers, and Truist Bank (successor by merger to SunTrust Bank) as the Issuing Bank and Administrative Agent (Exhibit 10.1 to our Current Report on Form 8-K dated May 20, 2020).
10.2
  
10.3
  
10.4
  
10.5
  
*31.1
  
*31.2
  
*32.1
  
101.INS
  
XBRL Instance Document – the instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.
101.SCH
  
XBRL Taxonomy Extension Schema.
101.CAL
  
XBRL Taxonomy Extension Calculation Linkbase.
101.LAB
  
XBRL Taxonomy Extension Label Linkbase.
101.PRE
  
XBRL Taxonomy Extension Presentation Linkbase.
101.DEF
  
XBRL Taxonomy Definition Linkbase.
104
  
Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101).

21

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, thereunto duly authorized.


       
HAVERTY FURNITURE COMPANIES, INC.
(Registrant)
         
         
Date:
August 10, 2020
  
By:
/s/ Clarence H. Smith
       
Clarence H. Smith
       
Chairman of the Board, President
and Chief Executive Officer
       
(principal executive officer)
         
         
     
By:
/s/ Richard B. Hare
       
Richard B. Hare
       
Executive Vice President and
Chief Financial Officer
(principal financial and accounting officer)

22
Exhibit 31.1

I, Clarence H. Smith, certify that:

1.
I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2020 of Haverty Furniture Companies, Inc.;

2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fiscal fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: August 10, 2020
  
/s/ Clarence H. Smith
   
Clarence H. Smith
Chairman of the Board, President
and Chief Executive Officer



Exhibit 31.2

I, Richard B. Hare, certify that:

1.
I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2020 of Haverty Furniture Companies, Inc.;

2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fiscal fourth quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: August 10, 2020
  
/s/ Richard B. Hare
   
Richard B. Hare
Executive Vice President and
Chief Financial Officer


Exhibit 32.1



CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Haverty Furniture Companies, Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2020 (the “Report”), I, Clarence H. Smith, Chairman of the Board, President and Chief Executive Officer of the Company, and I, Richard B. Hare, Executive Vice President and Chief Financial Officer of the Company, each certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
 
(2)
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 



Date:          August 10, 2020
  
/s/ Clarence H. Smith
   
Clarence H. Smith
Chairman of the Board, President
and Chief Executive Officer
     
     
   
/s/ Richard B. Hare
   
Richard B. Hare
Executive Vice President and
Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to Haverty Furniture Companies, Inc. and will be retained by Haverty Furniture Companies, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.


v3.20.2
Document and Entity Information - shares
 6 Months Ended
Jun. 30, 2020
Aug. 06, 2020
Document and Entity Information [Abstract]    
Entity Registrant Name HAVERTY FURNITURE COMPANIES, INC  
Entity Central Index Key 0000216085  
Current Fiscal Year End Date --12-31  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Shell Company false  
Entity Filer Category Accelerated Filer  
Entity Small Business false  
Entity Emerging Growth Company false  
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Jun. 30, 2020  
Document Fiscal Year Focus 2020  
Document Fiscal Period Focus Q2  
Document Quarterly Report true  
Document Transition Report false  
Entity File Number 1-14445  
Entity Tax Identification Number 58-0281900  
Entity Incorporation, State or Country Code MD  
Entity Address, Address Line One 780 Johnson Ferry Road, Suite 800  
Entity Address, City or Town Atlanta  
Entity Address, State or Province GA  
Entity Address, Postal Zip Code 30342  
City Area Code 404  
Local Phone Number 443-2900  
Common Stock [Member]    
Document and Entity Information [Abstract]    
Entity Common Stock, Shares Outstanding   17,286,821
Title of 12(b) Security Common Stock  
Trading Symbol HVT  
Security Exchange Name NYSE  
Class A Common Stock [Member]    
Document and Entity Information [Abstract]    
Entity Common Stock, Shares Outstanding   1,531,505
Title of 12(b) Security Class A Common Stock  
Trading Symbol HVTA  
Security Exchange Name NYSE  
v3.20.2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($)
$ in Thousands
Jun. 30, 2020
Dec. 31, 2019
Current assets    
Cash and cash equivalents $ 151,055 $ 75,739
Restricted cash and cash equivalents 6,709 6,663
Accounts receivable, net 1,141 1,527
Inventories 104,840 104,817
Prepaid expenses 10,302 7,652
Other current assets 8,960 8,125
Total current assets 283,007 204,523
Accounts receivable, long-term, net 128 195
Property and equipment, net 112,253 156,534
Right-of-use lease assets 234,046 175,474
Deferred income taxes 11,640 13,198
Other assets 10,035 10,148
Total assets 651,109 560,072
Current liabilities    
Accounts payable 22,803 27,830
Customer deposits 57,538 30,121
Accrued liabilities 45,733 39,654
Current lease liabilities 31,289 29,411
Total current liabilities 157,363 127,016
Noncurrent lease liabilities 206,918 149,594
Other liabilities 22,450 22,959
Total liabilities 386,731 299,569
Capital Stock, par value $1 per share    
Preferred Stock, Authorized - 1,000 shares; Issued: None
Additional paid-in capital 94,581 93,208
Retained earnings 304,900 295,999
Accumulated other comprehensive loss (2,027) (2,087)
Less treasury stock at cost - Common Stock (2020 - 12,251; 2019 - 11,850 shares) and Convertible Class A Common Stock (2020 and 2019 - 522 shares) (164,668) (158,102)
Total stockholders' equity 264,378 260,503
Total liabilities and stockholders' equity 651,109 560,072
Common Stock [Member]    
Capital Stock, par value $1 per share    
Common Stock 29,538 29,431
Total stockholders' equity 29,538 29,431
Common Stock [Member] | Convertible Class A [Member]    
Capital Stock, par value $1 per share    
Common Stock 2,054 2,054
Total stockholders' equity $ 2,054 $ 2,054
v3.20.2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares
shares in Thousands
Jun. 30, 2020
Dec. 31, 2019
Stockholders' equity    
Preferred Stock, par value (in dollars per share) $ 1 $ 1
Preferred Stock, shares authorized (in shares) 1,000 1,000
Preferred Stock, shares issued (in shares) 0 0
Capital Stock, par value (in dollars per share) $ 1 $ 1
Common Stock [Member]    
Stockholders' equity    
Common Stock, shares authorized (in shares) 50,000 50,000
Common Stock, shares issued (in shares) 29,538 29,431
Treasury Stock, common stock shares (in shares) 12,251 11,850
Common Stock [Member] | Convertible Class A [Member]    
Stockholders' equity    
Common Stock, shares authorized (in shares) 15,000 15,000
Common Stock, shares issued (in shares) 2,054 2,054
Treasury Stock, common stock shares (in shares) 522 522
v3.20.2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($)
$ in Thousands
 3 Months Ended 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Jun. 30, 2020
Jun. 30, 2019
Net sales $ 109,968 $ 191,893 $ 289,400 $ 379,134
Cost of goods sold 50,322 88,336 130,201 172,494
Gross profit 59,646 103,557 159,199 206,640
Credit service charges 19 19 38 41
Gross profit and other revenue 59,665 103,576 159,237 206,681
Expenses:        
Selling, general and administrative 72,649 95,784 170,184 194,663
Provision for doubtful accounts 3 20 36 23
Other (income) expense, net (31,812) (126) (31,895) (280)
Total expenses 40,840 95,678 138,325 194,406
Income before interest and income taxes 18,825 7,898 20,912 12,275
Interest expense (income), net 200 (339) (13) (688)
Income before income taxes 18,625 8,237 20,925 12,963
Income tax expense 4,985 2,191 5,466 3,295
Net income 13,640 6,046 15,459 9,668
Other comprehensive income        
Adjustments related to retirement plans; net of tax expense of $10 and $20 in 2020 and $3 and $6 in 2019 29 8 60 17
Comprehensive income $ 13,669 $ 6,054 $ 15,519 $ 9,685
Class A Common Stock [Member]        
Earnings per share:        
Basic earnings per share (in dollars per share) $ 0.69 $ 0.28 $ 0.78 $ 0.44
Diluted earnings per share (in dollars per share) 0.69 0.27 0.78 0.44
Cash dividends per share (in dollars per share) 0.14 0.17 0.33 0.34
Common Stock [Member]        
Earnings per share:        
Basic earnings per share (in dollars per share) 0.73 0.30 0.82 0.48
Diluted earnings per share (in dollars per share) 0.72 0.29 0.81 0.47
Cash dividends per share (in dollars per share) $ 0.15 $ 0.18 $ 0.35 $ 0.36
v3.20.2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (Parenthetical) - USD ($)
$ in Thousands
 3 Months Ended 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Jun. 30, 2020
Jun. 30, 2019
Other comprehensive income        
Adjustments related to retirement plans, tax expense $ 10 $ 3 $ 20 $ 6
v3.20.2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)
$ in Thousands
 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Cash Flows from Operating Activities:    
Net income $ 15,459 $ 9,668
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization 9,791 10,276
Share-based compensation expense 2,037 1,951
Gain from sale of land, property and equipment (31,607) (4)
Other 2,223 (1,262)
Changes in operating assets and liabilities:    
Inventories (23) (3,373)
Customer deposits 27,417 4,633
Operating lease assets and liabilities, net 629 2,863
Other assets and liabilities (3,609) (5,431)
Accounts payable and accrued liabilities 2,149 (4,481)
Net cash provided by operating activities 24,466 14,840
Cash Flows from Investing Activities:    
Capital expenditures (4,331) (7,768)
Proceeds from sale of land, property and equipment 69,468 2,260
Net cash provided by (used in) investing activities 65,137 (5,508)
Cash Flows from Financing Activities:    
Proceeds from borrowings under revolving credit facility 43,800 0
Payments of borrowings under revolving credit facility (43,800) 0
Net change in borrowings under revolving credit facility 0 0
Dividends paid (6,558) (7,285)
Common stock repurchased (6,810) (17,843)
Other (873) (1,328)
Net cash used in financing activities (14,241) (26,456)
Increase (decrease) in cash, cash equivalents and restricted cash equivalents during the period 75,362 (17,124)
Cash, cash equivalents and restricted cash equivalents at beginning of period 82,402 79,809
Cash, cash equivalents and restricted cash equivalents at end of period $ 157,764 $ 62,685
v3.20.2
Business and Basis of Presentation
 6 Months Ended
Jun. 30, 2020
Business and Basis of Presentation [Abstract]  
Business and Basis of Presentation
NOTE A – Business and Basis of Presentation

Haverty Furniture Companies, Inc. (“Havertys,” “the Company,” “we,” “our,” or “us”) is a retailer of a broad line of residential furniture in the middle to upper-middle price ranges. We operate all of our stores using the Havertys brand and do not franchise our concept. We operate within a single reportable segment.  The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not include all information and footnotes required by United States of America generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. The Company believes that the disclosures made are adequate to make the information not misleading.  The financial statements include the accounts of the Company and its wholly-owned subsidiary.  All significant intercompany accounts and transactions have been eliminated in consolidation. We believe all adjustments, normal and recurring in nature, considered necessary for a fair presentation have been included. We suggest that these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying footnotes included in our latest Annual Report on Form 10-K.

The preparation of interim condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities, and reported amounts of revenue and expenses. Actual results could differ from those estimates.

The Company is subject to various claims and legal proceedings covering a wide range of matters that arise in the ordinary course of its business activities.  We believe that any liability that may ultimately result from the resolution of these matters will not have a material adverse effect on our financial condition, results of operations or cash flows.
v3.20.2
COVID-19
 6 Months Ended
Jun. 30, 2020
COVID-19 [Abstract]  
COVID-19
Note B – COVID-19

In December 2019, a novel strain of coronavirus, subsequently named COVID-19, emerged from China and spread worldwide. The World Health Organization declared COVID-19 a pandemic and a national health emergency was declared by the United States beginning March 1, 2020. In response, many states and local governments began a series of restrictions on public gatherings, stay at home orders and advisories and quarantining of people who may have been exposed to the virus. In an effort to mitigate the spread of COVID-19 and protect our team members, customers, and communities, Havertys closed all of its stores on March 19 and halted deliveries on March 21, with the expectation at that time of reopening stores on April 2. Our stores remained closed during April and we reopened 103 locations on May 1 and the remaining 17 stores were reopened by June 20. We restarted our delivery operations on May 5.

The pandemic has resulted in significant economic disruption. Although our stores and other businesses are open or beginning to reopen there has been a resurgence in COVID-19 cases in several of our larger markets. We cannot reasonably estimate the impact on Havertys should the pandemic persist or worsen. Accordingly, the estimates and assumptions management made as of June 30, 2020 could change in subsequent interim reports and upon final determination at year-end, and it is reasonably possible that such changes could be significant (although the potential effects cannot be estimated at this time). The Company has evaluated subsequent events through the date the condensed consolidated financial statements covered by this quarterly report were issued.

CARES Act

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act") was signed into law. The CARES Act provides numerous tax provisions and other stimulus measures, including temporary suspension of certain payment requirements for the employer-paid portion of social security taxes, the creation of certain refundable employee retention credits, and technical corrections from prior tax legislation for tax depreciation of certain qualified improvement property. Havertys elected to defer the employer-paid portion of social security taxes beginning with pay dates on and after April 1, 2020. We recorded an estimate for refundable employee retention credits for eligible wages paid to employees during March 2020 affected by the cessation of our operations. Havertys recorded additional employee retention credits during the second quarter of 2020 for additional wages paid, primarily for health care benefits paid for employees furloughed in April 2020. We have also estimated a benefit from the technical correction for qualified leasehold improvements eligible for 100% tax bonus depreciation and adjusted our balances for deferred income taxes and income taxes receivable.
v3.20.2
Stockholders' Equity
 6 Months Ended
Jun. 30, 2020
Stockholders' Equity [Abstract]  
Stockholders' Equity
NOTE C – Stockholders’ Equity

The following outlines the changes in each caption of stockholders’ equity for the current and comparative periods and the dividends per share for each class of shares.

For the three months ended June 30, 2020:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at March 31, 2020
  
$
29,458
    
$
2,054
    
$
93,835
    
$
294,068
    
$
(2,056
)
  
$
(164,912
)
  
$
252,447
  
Net income
                            
13,640
                      
13,640
  
Dividends declared:
                                                        
Common Stock, $0.15 per share
                            
(2,593
)
                    
(2,593
)
Class A Common Stock, $0.14 per share
                            
(215
)
                    
(215
)
Restricted stock issuances
    
80
              
(634
)
                            
(554
)
Amortization of restricted stock
                    
1,064
                              
1,064
  
Directors’ Compensation Plan
                    
316
                      
244
      
560
  
Other comprehensive income
                                    
29
              
29
  
Balances at June 30, 2020
  
$
29,538
    
$
2,054
    
$
94,581
    
$
304,900
    
$
(2,027
)
  
$
(164,668
)
  
$
264,378
  

For the six months ended June 30, 2020:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at December 31, 2019
  
$
29,431
    
$
2,054
    
$
93,208
    
$
295,999
    
$
(2,087
)
  
$
(158,102
)
  
$
260,503
  
Net income
                            
15,459
                      
15,459
  
Dividends declared:
                                                        
Common Stock, $0.35 per share
                            
(6,052
)
                    
(6,052
)
Class A Common Stock, $0.33 per share
                            
(506
)
                    
(506
)
Acquisition of treasury stock
                                            
(6,810
)
    
(6,810
)
Restricted stock issuances
    
107
              
(980
)
                            
(873
)
Amortization of restricted stock
                    
2,037
                              
2,037
  
Directors’ Compensation Plan
                    
316
                      
244
      
560
  
Other comprehensive income
                                    
60
              
60
  
Balances at June 30, 2020
  
$
29,538
    
$
2,054
    
$
94,581
    
$
304,900
    
$
(2,027
)
  
$
(164,668
)
  
$
264,378
  

For the three months ended June 30, 2019:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at March 31, 2019
  
$
29,113
    
$
2,280
    
$
91,888
    
$
289,126
    
$
(1,456
)
  
$
(129,025
)
  
$
281,926
  
Net income
                            
6,046
                      
6,046
  
Dividends declared:
                                                        
Common Stock, $0.18 per share
                            
(3,338
)
                    
(3,338
)
Class A Common Stock, $0.17 per share
                            
(261
)
                    
(261
)
Acquisition of treasury stock
                                            
(17,843
)
    
(17,843
)
Restricted stock issuances
    
83
              
(878
)
                            
(795
)
Class A conversion
    
222
      
(222
)
                                    
—
  
Amortization of restricted stock
                    
890
                              
890
  
Directors’ Compensation Plan
                    
(53
)
                    
680
      
627
  
Other comprehensive income
                                    
8
              
8
  
Balances at June 30, 2019
  
$
29,418
    
$
2,058
    
$
91,847
    
$
291,573
    
$
(1,448
)
  
$
(146,188
)
  
$
267,260
  

For the six months ended June 30, 2019:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at December 31, 2018
  
$
29,079
    
$
2,280
    
$
91,394
    
$
282,366
    
$
(1,465
)
  
$
(129,025
)
  
$
274,629
  
Net income
                            
9,668
                      
9,668
  
Dividends declared:
                                                        
Common Stock, $0.36 per share
                            
(6,725
)
                    
(6,725
)
Class A Common Stock, $0.34 per share
                            
(560
)
                    
(560
)
Acquisition of treasury stock
                                            
(17,843
)
    
(17,843
)
Restricted stock issuances
    
117
              
(1,445
)
                            
(1,328
)
Class A conversion
    
222
      
(222
)
                                    
—
  
Amortization of restricted stock
                    
1,951
                              
1,951
  
Directors’ Compensation Plan
                    
(53
)
                    
680
      
627
  
Other comprehensive income
                                    
17
              
17
  
Cumulative effect adjustment
                            
6,824
                      
6,824
  
Balances at June 30, 2019
  
$
29,418
    
$
2,058
    
$
91,847
    
$
291,573
    
$
(1,448
)
  
$
(146,188
)
  
$
267,260
  
v3.20.2
Interim LIFO Calculations
 6 Months Ended
Jun. 30, 2020
Interim LIFO Calculations [Abstract]  
Interim LIFO Calculations
NOTE D – Interim LIFO Calculations

We calculate the LIFO index annually. Accordingly, interim LIFO calculations must necessarily be based on management’s estimates of inventory levels and inflation rates. Since these estimates may be affected by factors beyond management’s control, interim results are subject to change based upon the final year-end LIFO inventory valuations.
v3.20.2
Fair Value of Financial Instruments
 6 Months Ended
Jun. 30, 2020
Fair Value of Financial Instruments [Abstract]  
Fair Value of Financial Instruments
NOTE E – Fair Value of Financial Instruments

The fair values of our cash and cash equivalents, restricted cash and cash equivalents, accounts receivable, accounts payable and customer deposits approximate their carrying values due to their short-term nature. The assets related to our self-directed, non-qualified deferred compensation plans for certain executives and employees are valued using quoted market prices multiplied by the number of shares held, a Level 1 valuation technique. The assets related to our deferred compensation plans totaled approximately $7.4 million at June 30, 2020 and $7.5 million at December 31, 2019 and are included in other assets. The related liabilities of the same amounts are included in other liabilities.
v3.20.2
Credit Agreement
 6 Months Ended
Jun. 30, 2020
Credit Agreement [Abstract]  
Credit Agreement
NOTE F – Credit Agreement

On May 15, 2020 we entered into the Third Amendment to Amended and Restated Credit Agreement (as amended, the “Credit Agreement”) with a bank to permit certain sale-leaseback transactions as more fully described in Note L. Our first borrowings under the facility, since its origination in 2008, were in March 2020.

The Credit Agreement is a $60.0 million revolving credit facility secured by our inventory, accounts receivable, cash, and certain other personal property and matures on September 27, 2024. Availability fluctuates based on a borrowing base calculation reduced by outstanding letters of credit. Amounts available to borrow are based on the lesser of the borrowing base or the $60.0 million-line amount. The credit facility contains covenants that, among other things, limit our ability to incur certain types of debt or liens, enter into mergers and consolidations or use proceeds of borrowing for other than permitted uses. The covenants also limit our ability to pay dividends if unused availability is less than $12.5 million.

We borrowed $43.8 million under the Credit Agreement in March 2020 and repaid the borrowings in June 2020. The interest rates on the outstanding balance was based on the three-month Euro dollar LIBOR rate plus 1.25% and on a weighted average basis was approximately 2.37%. Total interest paid under the Credit Agreement was $0.3 million for the three months ended June 30, 2020.

The borrowing base was $42.9 million at June 30, 2020, there were no outstanding letters of credit, and the net availability was $42.9 million.
v3.20.2
Revenues
 6 Months Ended
Jun. 30, 2020
Revenues [Abstract]  
Revenues
Note G – Revenues

We recognize revenue at delivery. Havertys does not have a loyalty program or sell gift certificates or gift cards. We also do not offer coupons for redemption for future purchases, such as those other retailers might issue for general marketing purposes or in conjunction with prior purchases.

The following table presents our revenues disaggregated by each major product category and service (dollars in thousands, amounts and percentages may not always add due to rounding):

  
Three Months Ended June 30,
    
Six Months Ended June 30,
  
   
2020
    
2019
    
2020
    
2019
  
(In thousands)
  
Net
Sales
    
% of
Net Sales
    
Net
Sales
    
% of
Net Sales
    
Net
Sales
    
% of
Net Sales
    
Net
Sales
    
% of
Net Sales
  
Merchandise:
                                                
Case Goods
                                                
Bedroom Furniture
  
$
19,284
      
17.5
%
  
$
31,417
      
16.4
%
  
$
46,928
      
16.2
%
  
$
61,937
      
16.3
%
Dining Room Furniture
    
12,852
      
11.7
      
20,265
      
10.6
      
31,074
      
10.7
      
39,862
      
10.5
  
Occasional
    
11,199
      
10.2
      
14,568
      
7.6
      
27,450
      
9.5
      
30,945
      
8.2
  
     
43,335
      
39.4
      
66,251
      
34.5
      
105,452
      
36.4
      
132,744
      
35.0
  
Upholstery
    
44,455
      
40.4
      
77,146
      
40.2
      
118,084
      
40.8
      
150,178
      
39.6
  
Mattresses
    
10,377
      
9.4
      
21,976
      
11.5
      
29,195
      
10.1
      
43,234
      
11.4
  
Accessories and Other(1)
    
11,800
      
10.7
      
26,520
      
13.8
      
36,669
      
12.7
      
52,978
      
14.1
  
   
$
109,968
      
100.0
%
  
$
191,893
      
100.0
%
  
$
289,400
      
100.0
%
  
$
379,134
      
100.0
%

(1)
 Includes delivery charges and product protection.
v3.20.2
Leases
 6 Months Ended
Jun. 30, 2020
Leases [Abstract]  
Leases
NOTE H – Leases

We have operating leases for offices, warehouses, and certain equipment. Our leases have remaining lease terms of 1 year to 15 years, some of which include options to extend the leases for up to 20 years. We determine if an arrangement is or contains a lease at lease inception. Our leases do not have any residual value guarantees or any restrictions or covenants imposed by lessors. We have lease agreements for real estate with lease and non-lease components, which are accounted for separately.

Certain of our lease agreements for retail stores include variable lease payments, generally based on sales volume.  The variable portion of payments are not included in the initial measurement of the right-of-use asset or lease liability due to uncertainty of the payment amount and are recorded as lease expense in the period incurred. Certain of our equipment lease agreements include variable lease costs, generally based on usage of the underlying asset (mileage, fuel, etc.). The variable portion of payments are not included in the initial measurement of the right-of-use asset or lease liability due to uncertainty of the payment amount and are recorded in the period incurred.

As of June 30, 2020, we have entered into two leases for additional retail locations which have not yet commenced. One of these locations is under construction.

Lease expense is charged to selling, general and administrative expenses. Components of lease expense were as follows (in thousands):

  
Three Months Ended June 30,
    
Six Months Ended June 30,
  
   
2020
    
2019
    
2020
    
2019
  
Operating lease cost
  
$
11,083
    
$
10,465
    
$
21,515
    
$
20,693
  
Short-term lease cost
    
—
      
30
      
—
      
40
  
Variable lease cost
    
584
      
1,281
      
2,198
      
2,812
  
Total lease expense
  
$
11,667
    
$
11,776
    
$
23,713
    
$
23,545
  

Supplemental cash flow information related to leases is as follows (in thousands):

  
Six Months Ended June 30,
  
   
2020
    
2019
  
Cash paid for amounts included in the measurement of lease liabilities:
            
Operating cash flows from operating leases
  
$
14,028
    
$
20,085
  
Right-of-use assets obtained in exchange for lease obligations:
                
Operating leases
  
$
77,772
    
$
22,519
  

In April 2020, the Financial Accounting Standards Board issued guidance allowing entities to make a policy election to account for lease concessions related to the COVID-19 pandemic as though enforceable rights and obligations for those concessions existed. The election applies to any lessor-provided lease concession related to the impact of the COVID-19 pandemic, provided the concession does not result in a substantial increase in the rights of the lessor or in the obligations of the lessee. During the three months ended June 30, 2020, we have received concessions from certain landlords in the form of rent deferrals and abatements. We have elected to account for these rent concessions as though enforceable rights and obligations for those concessions existed in the original lease agreements and have recorded a non-interest bearing payable for the deferred rent payments. The recognition of rent concessions did not have a material impact on our condensed consolidated financial statements as of June 30, 2020.
v3.20.2
Income Taxes
 6 Months Ended
Jun. 30, 2020
Income Taxes [Abstract]  
Income Taxes
NOTE I – Income Taxes

Our effective tax rate for the six months ended June 30, 2020 and 2019 was 26.1% and 25.4%, respectively. The primary difference in the effective rate and the statutory rate is due to state income taxes and additional tax expense from vested stock awards.
v3.20.2
Stock Based Compensation Plan
 6 Months Ended
Jun. 30, 2020
Stock Based Compensation Plan [Abstract]  
Stock Based Compensation Plan
NOTE J – Stock Based Compensation Plan

As more fully discussed in Note 14 of the notes to the consolidated financial statements in our 2019 Annual Report on Form 10-K, we have awards outstanding for Common Stock under stock-based employee compensation plans.

The following table summarizes our award activity during the six months ended June 30, 2020:

  
Service-Based
Restricted Stock Awards
    
Performance-Based
Restricted Stock Awards
    
Stock-Settled
Appreciation Rights
  
   
Shares or Units (#)
    
Weighted-Average
Award Price ($)
    
Shares or Units (#)
    
Weighted-Average
Award Price ($)
    
Rights (#)
    
Weighted-Average
Award Price ($)
  
Outstanding at December 31, 2019
    
234,810
      
20.93
      
214,809
      
21.38
      
7,500
      
18.14
  
Granted/Issued
    
145,375
      
20.42
      
120,727
      
20.42
      
—
          
Awards vested or rights exercised(1)
    
(122,114
)
    
20.62
      
(44,875
)
    
22.12
      
(7,500
)
    
18.14
  
Forfeited
    
(4,750
)
    
20.40
      
(76,493
)
    
20.29
      
—
      
—
  
Outstanding at June 30, 2020
    
253,321
      
20.79
      
214,168
      
21.08
      
—
      
—
  
Restricted Units expected to vest
    
253,321
      
20.79
      
188,372
      
21.15
      
—
      
—
  

(1)
Includes shares repurchased from employees for employee’s tax liability.

The aggregate intrinsic value of outstanding service-based restricted stock awards was $4.1 million at June 30, 2020. The restrictions on the service-based awards generally lapse or vest annually, primarily over four-year and three-year periods.

The total fair value of performance-based restricted stock awards that vested during the six months ended June 30, 2020 was $1.0 million. The aggregate intrinsic value of outstanding performance awards at June 30, 2020 expected to vest was $3.0 million. The performance awards are based on one-year performance periods but cliff vest in approximately three years from grant date.

The fair value for stock-settled appreciation rights were estimated at the date of grant using a Black Scholes pricing model. The total intrinsic value of stock-settled appreciation rights exercised during the six months ended June 30, 2020 was $18,000.

The compensation for all awards is charged to selling, general and administrative expense over the respective grants’ vesting periods, primarily on a straight-line basis. The amount charged was approximately $2.0 million for the six months ended June 30, 2020 and 2019. Forfeitures are recognized as they occur. As of June 30, 2020, the total compensation cost related to unvested equity awards was approximately $6.6 million and is expected to be recognized over a weighted-average period of 2.3 years.
v3.20.2
Earnings Per Share
 6 Months Ended
Jun. 30, 2020
Earnings Per Share [Abstract]  
Earnings Per Share
NOTE K – Earnings Per Share

We report our earnings per share using the two-class method.  The income per share for each class of common stock is calculated assuming 100% of our earnings are distributed as dividends to each class of common stock based on their contractual rights.

The Common Stock of the Company has a preferential dividend rate of at least 105% of the dividend paid on the Class A Common Stock. The Class A Common Stock, which has ten votes per share as opposed to one vote per share for the Common Stock (on all matters other than the election of directors), may be converted at any time on a one-for-one basis into Common Stock at the option of the holder of the Class A Common Stock.


  
Three Months Ended
June 30,
    
Six Months Ended
June 30,
  
   
2020
    
2019
    
2020
    
2019
  
Numerator:
                        
Common:
                        
Distributed earnings
  
$
2,593
    
$
3,338
    
$
6,052
    
$
6,725
  
Undistributed earnings
    
9,987
      
2,260
      
8,211
      
2,194
  
Basic
    
12,580
      
5,598
      
14,263
      
8,919
  
Class A Common earnings
    
1,060
      
448
      
1,196
      
749
  
Diluted
  
$
13,640
    
$
6,046
    
$
15,459
    
$
9,668
  
                                 
Class A Common:
                                
Distributed earnings
  
$
215
    
$
261
    
$
506
    
$
560
  
Undistributed earnings
    
845
      
187
      
690
      
189
  
   
$
1,060
    
$
448
    
$
1,196
    
$
749
  
Denominator:
                                
Common:
                                
Weighted average shares outstanding - basic
    
17,245
      
18,642
      
17,353
      
18,716
  
Assumed conversion of Class A Common Stock
    
1,532
      
1,621
      
1,532
      
1,689
  
Dilutive options, awards and common stock equivalents
    
208
      
279
      
241
      
318
  
                                 
Total weighted-average diluted Common Stock
    
18,985
      
20,542
      
19,126
      
20,723
  
                                 
Class A Common:
                                
Weighted average shares outstanding
    
1,532
      
1,621
      
1,532
      
1,689
  
                                 
Basic earnings per share:
                                
Common Stock
  
$
0.73
    
$
0.30
    
$
0.82
    
$
0.48
  
Class A Common Stock
  
$
0.69
    
$
0.28
    
$
0.78
    
$
0.44
  
                                 
Diluted earnings per share:
                                
Common Stock
  
$
0.72
    
$
0.29
    
$
0.81
    
$
0.47
  
Class A Common Stock
  
$
0.69
    
$
0.27
    
$
0.78
    
$
0.44
  
v3.20.2
Sale and Leaseback Transaction
 6 Months Ended
Jun. 30, 2020
Sale and Leaseback Transaction [Abstract]  
Sale and Leaseback Transaction
NOTE L – Sale and Leaseback Transaction

On May 18, 2020, Havertys completed a sale and leaseback transaction of three properties.  The Coppell, Texas location has approximately 394,000 distribution square feet used to serve our western stores, 44,000 retail square feet, and 20,000 square feet of office space for call center and general management purposes. The Lakeland, Florida facility has approximately 335,000 distribution square feet, and the Colonial Heights, Virginia facility has approximately 129,000 distribution square feet.

The total purchase price for the three properties, excluding costs and taxes, was $70.0 million and the net book value was $37.9 million.  We recorded a gain of $31.6 million in May 2020 which is included in other income.

The three properties were leased back to Havertys under 15-year operating lease agreements with renewal options.

The following is a schedule of the future minimum lease payments under the lease agreements  for the three properties for each of the next five periods ending December 31 and thereafter (in thousands):

Six months ended December 31, 2020
  
$
2,191
  
Year ended December 31, 2021
    
4,434
  
Year ended December 31, 2022
    
4,523
  
Year ended December 31, 2023
    
4,613
  
Year ended December 31, 2024
    
4,706
  
Subsequent to 2024
    
54,966
  
Total future minimum lease payments
  
$
75,433
  
v3.20.2
Business and Basis of Presentation (Policies)
 6 Months Ended
Jun. 30, 2020
Business and Basis of Presentation [Abstract]  
Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not include all information and footnotes required by United States of America generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. The Company believes that the disclosures made are adequate to make the information not misleading.  The financial statements include the accounts of the Company and its wholly-owned subsidiary.  All significant intercompany accounts and transactions have been eliminated in consolidation. We believe all adjustments, normal and recurring in nature, considered necessary for a fair presentation have been included. We suggest that these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying footnotes included in our latest Annual Report on Form 10-K.
Use of Estimates
The preparation of interim condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities, and reported amounts of revenue and expenses. Actual results could differ from those estimates.
v3.20.2
Stockholders' Equity (Tables)
 6 Months Ended
Jun. 30, 2020
Stockholders' Equity [Abstract]  
Stockholders' Equity
The following outlines the changes in each caption of stockholders’ equity for the current and comparative periods and the dividends per share for each class of shares.

For the three months ended June 30, 2020:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at March 31, 2020
  
$
29,458
    
$
2,054
    
$
93,835
    
$
294,068
    
$
(2,056
)
  
$
(164,912
)
  
$
252,447
  
Net income
                            
13,640
                      
13,640
  
Dividends declared:
                                                        
Common Stock, $0.15 per share
                            
(2,593
)
                    
(2,593
)
Class A Common Stock, $0.14 per share
                            
(215
)
                    
(215
)
Restricted stock issuances
    
80
              
(634
)
                            
(554
)
Amortization of restricted stock
                    
1,064
                              
1,064
  
Directors’ Compensation Plan
                    
316
                      
244
      
560
  
Other comprehensive income
                                    
29
              
29
  
Balances at June 30, 2020
  
$
29,538
    
$
2,054
    
$
94,581
    
$
304,900
    
$
(2,027
)
  
$
(164,668
)
  
$
264,378
  

For the six months ended June 30, 2020:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at December 31, 2019
  
$
29,431
    
$
2,054
    
$
93,208
    
$
295,999
    
$
(2,087
)
  
$
(158,102
)
  
$
260,503
  
Net income
                            
15,459
                      
15,459
  
Dividends declared:
                                                        
Common Stock, $0.35 per share
                            
(6,052
)
                    
(6,052
)
Class A Common Stock, $0.33 per share
                            
(506
)
                    
(506
)
Acquisition of treasury stock
                                            
(6,810
)
    
(6,810
)
Restricted stock issuances
    
107
              
(980
)
                            
(873
)
Amortization of restricted stock
                    
2,037
                              
2,037
  
Directors’ Compensation Plan
                    
316
                      
244
      
560
  
Other comprehensive income
                                    
60
              
60
  
Balances at June 30, 2020
  
$
29,538
    
$
2,054
    
$
94,581
    
$
304,900
    
$
(2,027
)
  
$
(164,668
)
  
$
264,378
  

For the three months ended June 30, 2019:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at March 31, 2019
  
$
29,113
    
$
2,280
    
$
91,888
    
$
289,126
    
$
(1,456
)
  
$
(129,025
)
  
$
281,926
  
Net income
                            
6,046
                      
6,046
  
Dividends declared:
                                                        
Common Stock, $0.18 per share
                            
(3,338
)
                    
(3,338
)
Class A Common Stock, $0.17 per share
                            
(261
)
                    
(261
)
Acquisition of treasury stock
                                            
(17,843
)
    
(17,843
)
Restricted stock issuances
    
83
              
(878
)
                            
(795
)
Class A conversion
    
222
      
(222
)
                                    
—
  
Amortization of restricted stock
                    
890
                              
890
  
Directors’ Compensation Plan
                    
(53
)
                    
680
      
627
  
Other comprehensive income
                                    
8
              
8
  
Balances at June 30, 2019
  
$
29,418
    
$
2,058
    
$
91,847
    
$
291,573
    
$
(1,448
)
  
$
(146,188
)
  
$
267,260
  

For the six months ended June 30, 2019:

(in thousands)
  
Common Stock
    
Class A Common Stock
    
Additional Paid-In Capital
    
Retained Earnings
    
Accumulated Other
Comprehensive Loss
    
Treasury Stock
    
Total
  
Balances at December 31, 2018
  
$
29,079
    
$
2,280
    
$
91,394
    
$
282,366
    
$
(1,465
)
  
$
(129,025
)
  
$
274,629
  
Net income
                            
9,668
                      
9,668
  
Dividends declared:
                                                        
Common Stock, $0.36 per share
                            
(6,725
)
                    
(6,725
)
Class A Common Stock, $0.34 per share
                            
(560
)
                    
(560
)
Acquisition of treasury stock
                                            
(17,843
)
    
(17,843
)
Restricted stock issuances
    
117
              
(1,445
)
                            
(1,328
)
Class A conversion
    
222
      
(222
)
                                    
—
  
Amortization of restricted stock
                    
1,951
                              
1,951
  
Directors’ Compensation Plan
                    
(53
)
                    
680
      
627
  
Other comprehensive income
                                    
17
              
17
  
Cumulative effect adjustment
                            
6,824
                      
6,824
  
Balances at June 30, 2019
  
$
29,418
    
$
2,058
    
$
91,847
    
$
291,573
    
$
(1,448
)
  
$
(146,188
)
  
$
267,260
  
v3.20.2
Revenues (Tables)
 6 Months Ended
Jun. 30, 2020
Revenues [Abstract]  
Disaggregation of Revenue by Major Product Category and Service
The following table presents our revenues disaggregated by each major product category and service (dollars in thousands, amounts and percentages may not always add due to rounding):

  
Three Months Ended June 30,
    
Six Months Ended June 30,
  
   
2020
    
2019
    
2020
    
2019
  
(In thousands)
  
Net
Sales
    
% of
Net Sales
    
Net
Sales
    
% of
Net Sales
    
Net
Sales
    
% of
Net Sales
    
Net
Sales
    
% of
Net Sales
  
Merchandise:
                                                
Case Goods
                                                
Bedroom Furniture
  
$
19,284
      
17.5
%
  
$
31,417
      
16.4
%
  
$
46,928
      
16.2
%
  
$
61,937
      
16.3
%
Dining Room Furniture
    
12,852
      
11.7
      
20,265
      
10.6
      
31,074
      
10.7
      
39,862
      
10.5
  
Occasional
    
11,199
      
10.2
      
14,568
      
7.6
      
27,450
      
9.5
      
30,945
      
8.2
  
     
43,335
      
39.4
      
66,251
      
34.5
      
105,452
      
36.4
      
132,744
      
35.0
  
Upholstery
    
44,455
      
40.4
      
77,146
      
40.2
      
118,084
      
40.8
      
150,178
      
39.6
  
Mattresses
    
10,377
      
9.4
      
21,976
      
11.5
      
29,195
      
10.1
      
43,234
      
11.4
  
Accessories and Other(1)
    
11,800
      
10.7
      
26,520
      
13.8
      
36,669
      
12.7
      
52,978
      
14.1
  
   
$
109,968
      
100.0
%
  
$
191,893
      
100.0
%
  
$
289,400
      
100.0
%
  
$
379,134
      
100.0
%

(1)
 Includes delivery charges and product protection.
v3.20.2
Leases (Tables)
 6 Months Ended
Jun. 30, 2020
Leases [Abstract]  
Components of Lease Expense
Lease expense is charged to selling, general and administrative expenses. Components of lease expense were as follows (in thousands):

  
Three Months Ended June 30,
    
Six Months Ended June 30,
  
   
2020
    
2019
    
2020
    
2019
  
Operating lease cost
  
$
11,083
    
$
10,465
    
$
21,515
    
$
20,693
  
Short-term lease cost
    
—
      
30
      
—
      
40
  
Variable lease cost
    
584
      
1,281
      
2,198
      
2,812
  
Total lease expense
  
$
11,667
    
$
11,776
    
$
23,713
    
$
23,545
  
Supplemental Cash Flow Information Related to Leases
Supplemental cash flow information related to leases is as follows (in thousands):

  
Six Months Ended June 30,
  
   
2020
    
2019
  
Cash paid for amounts included in the measurement of lease liabilities:
            
Operating cash flows from operating leases
  
$
14,028
    
$
20,085
  
Right-of-use assets obtained in exchange for lease obligations:
                
Operating leases
  
$
77,772
    
$
22,519
  
v3.20.2
Stock Based Compensation Plan (Tables)
 6 Months Ended
Jun. 30, 2020
Stock Based Compensation Plan [Abstract]  
Award Activity
The following table summarizes our award activity during the six months ended June 30, 2020:

  
Service-Based
Restricted Stock Awards
    
Performance-Based
Restricted Stock Awards
    
Stock-Settled
Appreciation Rights
  
   
Shares or Units (#)
    
Weighted-Average
Award Price ($)
    
Shares or Units (#)
    
Weighted-Average
Award Price ($)
    
Rights (#)
    
Weighted-Average
Award Price ($)
  
Outstanding at December 31, 2019
    
234,810
      
20.93
      
214,809
      
21.38
      
7,500
      
18.14
  
Granted/Issued
    
145,375
      
20.42
      
120,727
      
20.42
      
—
          
Awards vested or rights exercised(1)
    
(122,114
)
    
20.62
      
(44,875
)
    
22.12
      
(7,500
)
    
18.14
  
Forfeited
    
(4,750
)
    
20.40
      
(76,493
)
    
20.29
      
—
      
—
  
Outstanding at June 30, 2020
    
253,321
      
20.79
      
214,168
      
21.08
      
—
      
—
  
Restricted Units expected to vest
    
253,321
      
20.79
      
188,372
      
21.15
      
—
      
—
  

(1)
Includes shares repurchased from employees for employee’s tax liability.
v3.20.2
Earnings Per Share (Tables)
 6 Months Ended
Jun. 30, 2020
Earnings Per Share [Abstract]  
Earnings Per Share
 
Three Months Ended
June 30,
    
Six Months Ended
June 30,
  
   
2020
    
2019
    
2020
    
2019
  
Numerator:
                        
Common:
                        
Distributed earnings
  
$
2,593
    
$
3,338
    
$
6,052
    
$
6,725
  
Undistributed earnings
    
9,987
      
2,260
      
8,211
      
2,194
  
Basic
    
12,580
      
5,598
      
14,263
      
8,919
  
Class A Common earnings
    
1,060
      
448
      
1,196
      
749
  
Diluted
  
$
13,640
    
$
6,046
    
$
15,459
    
$
9,668
  
                                 
Class A Common:
                                
Distributed earnings
  
$
215
    
$
261
    
$
506
    
$
560
  
Undistributed earnings
    
845
      
187
      
690
      
189
  
   
$
1,060
    
$
448
    
$
1,196
    
$
749
  
Denominator:
                                
Common:
                                
Weighted average shares outstanding - basic
    
17,245
      
18,642
      
17,353
      
18,716
  
Assumed conversion of Class A Common Stock
    
1,532
      
1,621
      
1,532
      
1,689
  
Dilutive options, awards and common stock equivalents
    
208
      
279
      
241
      
318
  
                                 
Total weighted-average diluted Common Stock
    
18,985
      
20,542
      
19,126
      
20,723
  
                                 
Class A Common:
                                
Weighted average shares outstanding
    
1,532
      
1,621
      
1,532
      
1,689
  
                                 
Basic earnings per share:
                                
Common Stock
  
$
0.73
    
$
0.30
    
$
0.82
    
$
0.48
  
Class A Common Stock
  
$
0.69
    
$
0.28
    
$
0.78
    
$
0.44
  
                                 
Diluted earnings per share:
                                
Common Stock
  
$
0.72
    
$
0.29
    
$
0.81
    
$
0.47
  
Class A Common Stock
  
$
0.69
    
$
0.27
    
$
0.78
    
$
0.44
  
v3.20.2
Sale and Leaseback Transaction (Tables)
 6 Months Ended
Jun. 30, 2020
Sale and Leaseback Transaction [Abstract]  
Future Minimum Lease Payments
The following is a schedule of the future minimum lease payments under the lease agreements  for the three properties for each of the next five periods ending December 31 and thereafter (in thousands):

Six months ended December 31, 2020
  
$
2,191
  
Year ended December 31, 2021
    
4,434
  
Year ended December 31, 2022
    
4,523
  
Year ended December 31, 2023
    
4,613
  
Year ended December 31, 2024
    
4,706
  
Subsequent to 2024
    
54,966
  
Total future minimum lease payments
  
$
75,433
  
v3.20.2
Business and Basis of Presentation (Details)
 6 Months Ended
Jun. 30, 2020
Segment
Business and Basis of Presentation [Abstract]  
Number of reportable segments 1
v3.20.2
COVID-19 (Details) - Store
 2 Months Ended
May 01, 2020
Jun. 20, 2020
COVID-19 [Member]    
COVID-19 [Abstract]    
Number of stores reopened 103 17
v3.20.2
Stockholders' Equity (Details) - USD ($)
$ / shares in Units, $ in Thousands
 3 Months Ended 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Jun. 30, 2020
Jun. 30, 2019
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Beginning balance $ 252,447 $ 281,926 $ 260,503 $ 274,629
Net income 13,640 6,046 15,459 9,668
Dividends declared (2,593) (3,338) (6,052) (6,725)
Acquisition of treasury stock   (17,843) (6,810) (17,843)
Restricted stock issuances (554) (795) (873) (1,328)
Class A conversion   0   0
Amortization of restricted stock 1,064 890 2,037 1,951
Director's compensation plan 560 627 560 627
Other comprehensive income 29 8 60 17
Ending balance 264,378 267,260 264,378 267,260
Class A Common Stock [Member]        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Dividends declared $ (215) (261) $ (506) (560)
Class A conversion   $ (222)   $ (222)
Cash dividends, common stock (in dollars per share) $ 0.14 $ 0.17 $ 0.33 $ 0.34
Common Stock [Member]        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Beginning balance $ 29,458 $ 29,113 $ 29,431 $ 29,079
Restricted stock issuances 80 83 107 117
Class A conversion   222   222
Ending balance $ 29,538 $ 29,418 $ 29,538 $ 29,418
Cash dividends, common stock (in dollars per share) $ 0.15 $ 0.18 $ 0.35 $ 0.36
Common Stock [Member] | Class A Common Stock [Member]        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Beginning balance $ 2,054 $ 2,280 $ 2,054 $ 2,280
Ending balance 2,054 2,058 2,054 2,058
Additional Paid-In Capital [Member]        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Beginning balance 93,835 91,888 93,208 91,394
Restricted stock issuances (634) (878) (980) (1,445)
Amortization of restricted stock 1,064 890 2,037 1,951
Director's compensation plan 316 (53) 316 (53)
Ending balance 94,581 91,847 94,581 91,847
Retained Earnings [Member]        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Beginning balance 294,068 289,126 295,999 282,366
Net income 13,640 6,046 15,459 9,668
Dividends declared (2,593) (3,338) (6,052) (6,725)
Ending balance 304,900 291,573 304,900 291,573
Retained Earnings [Member] | Class A Common Stock [Member]        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Dividends declared (215) (261) (506) (560)
Accumulated Other Comprehensive Loss [Member]        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Beginning balance (2,056) (1,456) (2,087) (1,465)
Other comprehensive income 29 8 60 17
Ending balance (2,027) (1,448) (2,027) (1,448)
Treasury Stock [Member]        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Beginning balance (164,912) (129,025) (158,102) (129,025)
Acquisition of treasury stock   (17,843) (6,810) (17,843)
Director's compensation plan 244 680 244 680
Ending balance $ (164,668) $ (146,188) $ (164,668) (146,188)
Cumulative Effect, Period of Adoption, Adjustment [Member]        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Beginning balance       6,824
Cumulative Effect, Period of Adoption, Adjustment [Member] | Retained Earnings [Member]        
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Beginning balance       $ 6,824
v3.20.2
Fair Value of Financial Instruments (Details) - USD ($)
$ in Millions
Jun. 30, 2020
Dec. 31, 2019
Level 1 [Member]    
Fair Values of Financial Instruments [Abstract]    
Deferred compensation plans $ 7.4 $ 7.5
v3.20.2
Credit Agreement (Details) - USD ($)
$ in Thousands
 1 Months Ended 3 Months Ended 6 Months Ended
Jun. 30, 2020
Mar. 31, 2020
Jun. 30, 2020
Jun. 30, 2020
Jun. 30, 2019
Credit Agreement [Abstract]          
Proceeds from borrowings       $ 43,800 $ 0
Repayment of borrowings       43,800 $ 0
Credit Agreement [Member]          
Credit Agreement [Abstract]          
Maximum borrowing capacity $ 60,000   $ 60,000 $ 60,000  
Maturity date       Sep. 27, 2024  
Covenant limit for unused availability to pay dividends 12,500   $ 12,500 $ 12,500  
Proceeds from borrowings   $ 43,800      
Repayment of borrowings $ 43,800        
Weighted average interest rate 2.37%   2.37% 2.37%  
Interest paid     $ 300    
Current borrowing base $ 42,900   42,900 $ 42,900  
Outstanding letters of credit 0   0 0  
Net availability $ 42,900   $ 42,900 $ 42,900  
Credit Agreement [Member] | Euro Dollar LIBOR Rate [Member]          
Credit Agreement [Abstract]          
Term of variable interest rate       3 months  
Basis spread on variable rate       1.25%  
v3.20.2
Revenues (Details) - USD ($)
$ in Thousands
 3 Months Ended 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Jun. 30, 2020
Jun. 30, 2019
Disaggregation of Revenue [Abstract]        
Net sales $ 109,968 $ 191,893 $ 289,400 $ 379,134
Net Sales [Member]        
Disaggregation of Revenue [Abstract]        
Percentage of net sales 100.00% 100.00% 100.00% 100.00%
Case Goods [Member]        
Disaggregation of Revenue [Abstract]        
Net sales $ 43,335 $ 66,251 $ 105,452 $ 132,744
Case Goods [Member] | Net Sales [Member]        
Disaggregation of Revenue [Abstract]        
Percentage of net sales 39.40% 34.50% 36.40% 35.00%
Bedroom Furniture [Member]        
Disaggregation of Revenue [Abstract]        
Net sales $ 19,284 $ 31,417 $ 46,928 $ 61,937
Bedroom Furniture [Member] | Net Sales [Member]        
Disaggregation of Revenue [Abstract]        
Percentage of net sales 17.50% 16.40% 16.20% 16.30%
Dining Room Furniture [Member]        
Disaggregation of Revenue [Abstract]        
Net sales $ 12,852 $ 20,265 $ 31,074 $ 39,862
Dining Room Furniture [Member] | Net Sales [Member]        
Disaggregation of Revenue [Abstract]        
Percentage of net sales 11.70% 10.60% 10.70% 10.50%
Occasional [Member]        
Disaggregation of Revenue [Abstract]        
Net sales $ 11,199 $ 14,568 $ 27,450 $ 30,945
Occasional [Member] | Net Sales [Member]        
Disaggregation of Revenue [Abstract]        
Percentage of net sales 10.20% 7.60% 9.50% 8.20%
Upholstery [Member]        
Disaggregation of Revenue [Abstract]        
Net sales $ 44,455 $ 77,146 $ 118,084 $ 150,178
Upholstery [Member] | Net Sales [Member]        
Disaggregation of Revenue [Abstract]        
Percentage of net sales 40.40% 40.20% 40.80% 39.60%
Mattresses [Member]        
Disaggregation of Revenue [Abstract]        
Net sales $ 10,377 $ 21,976 $ 29,195 $ 43,234
Mattresses [Member] | Net Sales [Member]        
Disaggregation of Revenue [Abstract]        
Percentage of net sales 9.40% 11.50% 10.10% 11.40%
Accessories and Other [Member]        
Disaggregation of Revenue [Abstract]        
Net sales [1] $ 11,800 $ 26,520 $ 36,669 $ 52,978
Accessories and Other [Member] | Net Sales [Member]        
Disaggregation of Revenue [Abstract]        
Percentage of net sales 10.70% 13.80% 12.70% 14.10%
[1]  Includes delivery charges and product protection.
v3.20.2
Leases (Details)
$ in Thousands
 3 Months Ended 6 Months Ended
Jun. 30, 2020
USD ($)
Lease
Location
Jun. 30, 2019
USD ($)
Jun. 30, 2020
USD ($)
Lease
Location
Jun. 30, 2019
USD ($)
Operating Leases [Abstract]        
Number of leases for additional retail locations not yet commenced | Lease 2   2  
Number of retail locations under construction | Location 1   1  
Lease Expense [Abstract]        
Operating lease cost $ 11,083 $ 10,465 $ 21,515 $ 20,693
Short-term lease cost 0 30 0 40
Variable lease cost 584 1,281 2,198 2,812
Total lease expense $ 11,667 $ 11,776 23,713 23,545
Cash Paid for Amounts Included in the Measurement of Lease Liabilities [Abstract]        
Operating cash flows from operating leases     14,028 20,085
Right-of-use Assets Obtained in Exchange for Lease Obligations [Abstract]        
Operating leases     $ 77,772 $ 22,519
Minimum [Member]        
Operating Leases [Abstract]        
Remaining lease term 1 year   1 year  
Maximum [Member]        
Operating Leases [Abstract]        
Remaining lease term 15 years   15 years  
Lease term extension option 20 years   20 years  
v3.20.2
Income Taxes (Details)
 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Income Taxes [Abstract]    
Effective tax rate 26.10% 25.40%
v3.20.2
Stock Based Compensation Plan (Details) - USD ($)
 6 Months Ended
Jun. 30, 2020
Jun. 30, 2019
Additional Disclosures [Abstract]    
Total compensation cost related to unvested equity awards $ 6,600,000  
Weighted-average period of recognition of cost 2 years 3 months 18 days  
Selling, General and Administrative Expense [Member]    
Additional Disclosures [Abstract]    
Stock based compensation expense $ 2,000,000.0 $ 2,000,000.0
Service-Based Restricted Stock Awards [Member]    
Shares or Units and Rights [Roll Forward]    
Outstanding, beginning balance (in shares) 234,810  
Granted/Issued (in shares) 145,375  
Awards vested or rights exercised (in shares) [1] (122,114)  
Forfeited (in shares) (4,750)  
Outstanding, ending balance (in shares) 253,321  
Restricted Units expected to vest (in shares) 253,321  
Weighted-Average Award Price [Roll Forward]    
Outstanding, beginning balance (in dollars per share) $ 20.93  
Granted/Issued (in dollars per share) 20.42  
Awards vested or rights exercised (in dollars per share) [1] 20.62  
Forfeited (in dollars per share) 20.40  
Outstanding, ending balance (in dollars per share) 20.79  
Restricted Units expected to vest (in dollars per share) $ 20.79  
Additional Disclosures [Abstract]    
Aggregate intrinsic value of outstanding awards $ 4,100,000  
Service-Based Restricted Stock Awards [Member] | Maximum [Member]    
Additional Disclosures [Abstract]    
Vesting period of awards 4 years  
Service-Based Restricted Stock Awards [Member] | Minimum [Member]    
Additional Disclosures [Abstract]    
Vesting period of awards 3 years  
Performance-Based Restricted Stock Awards [Member]    
Shares or Units and Rights [Roll Forward]    
Outstanding, beginning balance (in shares) 214,809  
Granted/Issued (in shares) 120,727  
Awards vested or rights exercised (in shares) [1] (44,875)  
Forfeited (in shares) (76,493)  
Outstanding, ending balance (in shares) 214,168  
Restricted Units expected to vest (in shares) 188,372  
Weighted-Average Award Price [Roll Forward]    
Outstanding, beginning balance (in dollars per share) $ 21.38  
Granted/Issued (in dollars per share) 20.42  
Awards vested or rights exercised (in dollars per share) [1] 22.12  
Forfeited (in dollars per share) 20.29  
Outstanding, ending balance (in dollars per share) 21.08  
Restricted Units expected to vest (in dollars per share) $ 21.15  
Additional Disclosures [Abstract]    
Aggregate intrinsic value of outstanding awards $ 3,000,000.0  
Fair value of vested shares $ 1,000,000.0  
Performance period 1 year  
Vesting period of awards 3 years  
Stock-Settled Appreciation Rights [Member]    
Shares or Units and Rights [Roll Forward]    
Outstanding, beginning balance (in shares) 7,500  
Granted/Issued (in shares) 0  
Awards vested or rights exercised (in shares) [1] (7,500)  
Forfeited (in shares) 0  
Outstanding, ending balance (in shares) 0  
Restricted Units expected to vest (in shares) 0  
Weighted-Average Award Price [Roll Forward]    
Outstanding, beginning balance (in dollars per share) $ 18.14  
Awards vested or rights exercised (in dollars per share) [1] 18.14  
Forfeited (in dollars per share) 0  
Outstanding, ending balance (in dollars per share) 0  
Restricted Units expected to vest (in dollars per share) $ 0  
Additional Disclosures [Abstract]    
Intrinsic value of awards exercised $ 18,000  
[1] Includes shares repurchased from employees for employee’s tax liability.
v3.20.2
Earnings Per Share (Details)
$ / shares in Units, shares in Thousands, $ in Thousands
 3 Months Ended 6 Months Ended
Jun. 30, 2020
USD ($)
$ / shares
shares
Jun. 30, 2019
USD ($)
$ / shares
shares
Jun. 30, 2020
USD ($)
Vote
$ / shares
shares
Jun. 30, 2019
USD ($)
$ / shares
shares
Earnings Per Share [Abstract]        
Percentage of earnings assumed to be distributed as dividends in earnings per share calculation     100.00%  
Preferential dividend rate     105.00%  
Class A Common Stock [Member]        
Earnings Per Share [Abstract]        
Number of votes per share | Vote     10  
Numerator [Abstract]        
Distributed earnings $ 215 $ 261 $ 506 $ 560
Undistributed earnings 845 187 690 189
Basic $ 1,060 $ 448 $ 1,196 $ 749
Denominator [Abstract]        
Weighted average shares outstanding (in shares) | shares 1,532 1,621 1,532 1,689
Earnings Per Share [Abstract]        
Basic earnings per share (in dollars per share) | $ / shares $ 0.69 $ 0.28 $ 0.78 $ 0.44
Diluted earnings per share (in dollars per share) | $ / shares $ 0.69 $ 0.27 $ 0.78 $ 0.44
Common Stock [Member]        
Earnings Per Share [Abstract]        
Number of votes per share | Vote     1  
Numerator [Abstract]        
Distributed earnings $ 2,593 $ 3,338 $ 6,052 $ 6,725
Undistributed earnings 9,987 2,260 8,211 2,194
Basic 12,580 5,598 14,263 8,919
Diluted $ 13,640 $ 6,046 $ 15,459 $ 9,668
Denominator [Abstract]        
Weighted average shares outstanding - basic (in shares) | shares 17,245 18,642 17,353 18,716
Assumed conversion of Class A Common Stock (in shares) | shares 1,532 1,621 1,532 1,689
Dilutive options, awards and common stock equivalents (in shares) | shares 208 279 241 318
Total weighted-average diluted Common Stock (in shares) | shares 18,985 20,542 19,126 20,723
Earnings Per Share [Abstract]        
Basic earnings per share (in dollars per share) | $ / shares $ 0.73 $ 0.30 $ 0.82 $ 0.48
Diluted earnings per share (in dollars per share) | $ / shares $ 0.72 $ 0.29 $ 0.81 $ 0.47
v3.20.2
Sale and Leaseback Transaction (Details)
$ in Thousands
 1 Months Ended
May 31, 2020
USD ($)
Jun. 30, 2020
USD ($)
ft²
May 18, 2020
USD ($)
Property
Sale and Leaseback Transaction [Abstract]      
Number of properties included in sale and leaseback transaction | Property     3
Purchase price     $ 70,000
Net book value of three properties     $ 37,900
Term of operating lease   15 years  
Future Minimum Lease Payments [Abstract]      
Six months ended December 31, 2020   $ 2,191  
Year ended December 31, 2021   4,434  
Year ended December 31, 2022   4,523  
Year ended December 31, 2023   4,613  
Year ended December 31, 2024   4,706  
Subsequent to 2024   54,966  
Total future minimum lease payments   $ 75,433  
Other Income [Member]      
Sale and Leaseback Transaction [Abstract]      
Gain on sale and leaseback transaction $ 31,600    
Coppell, Texas [Member] | Distribution Space [Member]      
Sale and Leaseback Transaction [Abstract]      
Area of property | ft²   394,000  
Coppell, Texas [Member] | Retail Space [Member]      
Sale and Leaseback Transaction [Abstract]      
Area of property | ft²   44,000  
Coppell, Texas [Member] | Office Space [Member]      
Sale and Leaseback Transaction [Abstract]      
Area of property | ft²   20,000  
Lakeland, Florida [Member] | Distribution Space [Member]      
Sale and Leaseback Transaction [Abstract]      
Area of property | ft²   335,000  
Colonial Heights, Virginia [Member] | Distribution Space [Member]      
Sale and Leaseback Transaction [Abstract]      
Area of property | ft²   129,000