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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM
8-K
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Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
Date of Report (Date of Earliest Event Reported):
May 1, 2024
(May 1, 2024)
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Haverty Furniture Companies, Inc.
(Exact Name of Registrant as Specified in Its Charter)
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1-14445
(Commission File Number)
Maryland 58-0281900
(State or Other Jurisdiction of Incorporation) (I.R.S. Employer Identification No.)
780 Johnson Ferry Road, NE
,
Suite 800
Atlanta
,
Georgia
30342
(Address of principal executive offices, including zip code)
(
404
)
443-2900
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Name of each exchange on which registered
Symbol(s)
Common Stock HVT NYSE
Class A Common Stock HVTA NYSE
Indicate by check mark whether the registrant is an emerging growth company as
defined in Rule 405 of the Securities Act of 1933 ((s)230.405 of this chapter)
or Rule 12b-2 of the Securities Exchange Act of 1934 ((s)240.12b-2 of this
chapter):
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has
elected not to use the extended transition period for complying with any new
or revised financial accounting standards provided pursuant to Section 13(a)
of the Exchange Act.
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Item 2.02
Results of Operations and Financial Condition
On May 1, 2024, Havertys issued a press release regarding the declaration and
increase in its quarterly dividend and the results of its operations for the
quarter ended March 31, 2024. A copy of the press release is furnished as
Exhibit 99.1. The attached Exhibit 99.1 is not filed but is furnished to
comply with Regulation FD. The information disclosed in this Item 2.02 Current
Report on Form 8-K is not considered to be "filed" for purposes of Section 18
of the Securities and Exchange Act of 1934 and is not subject to the
liabilities of that section.
Item 9.01
Financial Statements and Exhibits
(d) Exhibits. The following exhibit is furnished as part of this Report:
99.1
Press Release dated May 1, 2024, issued by Registrant.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HAVERTY FURNITURE COMPANIES, INC.
May 1, 2024 By:
Jenny Hill Parker
Senior Vice President, Finance and
Corporate Secretary
EXHIBIT 99.1
Havertys Announces Increase In Quarterly Dividend and
First
Quarter
2024
Results
Atlanta, Georgia,
May 1, 2024
- HAVERTYS (NYSE: HVT and HVT.A), today announced an increase to its quarterly
dividend (the 12th consecutive annual increase) and reported operating results
for the
first
quarter ended
March 31, 2024
.
Dividend
The board of directors declared a 6.7% increase in the quarterly dividend,
from $0.30 per share to $0.32 per share on the company's common stock. The
quarterly dividend for the company's Class A common stock is also being
increased from $0.28 to $0.30 per share.
The dividend is payable on June 14, 2024, to stockholders of record at the
close of business on May 24, 2024. Havertys has paid a cash dividend in each
year since 1935.
First
quarter
2024
versus
first
quarter
2023
:
. Diluted earnings per common share ("EPS") of
$0.14
versus
$0.74
.
. Consolidated sales decreased 18.1% to
$184.0
million. Comparable-store sales decreased 18.5%.
. Gross profit margin increased to
60.3%
from
59.1%
.
Clarence H. Smith, Chairman and CEO said, "Our sales reflect the challenges
from the ongoing weak housing market. The decline in demand requires
exceptional customer engagement and operational flexibility. We began
highlighting our regret-free guarantee early in 2024 and continued promoting
our free-in home design service which grew 10.4% in the first quarter compared
to last year and was 32.3% of our total written business. Our teams generated
another quarter of excellent gross margins of 60.3% and the prudent reductions
in operating costs generated positive results for the quarter.
We are investing capital to expand our business and are on track to open five
new stores this year and five in 2025. Our new store located in Southaven, MS
in the Memphis, TN market opened at the end of March. The three stores we
previously announced are in-fill opportunities in growing areas of Florida and
should open in the second and third quarter this year. We plan to enter the
Houston, TX market later this year with one store slated to open in the fourth
quarter and additional locations in early 2025. This is a sizeable new market
within our distribution footprint that we believe aligns well with the
Havertys brand.
We are making important investments in our stores and online presence to be
well-positioned to gain additional market share at the reversal of this
near-term demand cycle. The board's decision to increase the quarterly
dividend reflects our strong financial position and long-term outlook as we
invest in our business and return capital to our stockholders."
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NEWS RELEASE - May 1, 2024
Page 2
Key Results
(amounts in millions, except per share amounts)
Results of Operations
Three Months Ended March 31,
2024 2023
Sales $ 184.0 $ 224.8
Gross Profit 111.0 132.8
Gross profit as a % of sales 60.3 % 59.1 %
SGA
Variable 37.0 44.9
Fixed 72.4 73.5
Total 109.4 118.4
SGA as a % of sales
Variable 20.1 % 20.0 %
Fixed 39.3 % 32.7 %
Total 59.4 % 52.7 %
Pre-tax income 3.2 15.4
Pre-tax income as a % of sales 1.7 % 6.9 %
Net income 2.4 12.4
Net income as a % of sales 1.3 % 5.5 %
Diluted earnings per share ("EPS") $ 0.14 $ 0.74
Other Financial and Operations Data
Three Months Ended March 31,
2024 2023
EBITDA (in millions) $ 6.6 $ 18.8
(1)
Sales per square foot $ 169 $ 208
Average ticket $ 3,208 $ 3,192
Liquidity Measures
Three Months Ended March 31, Three Months Ended March 31,
Free Cash Flow 2024 2023 Cash Returns to Shareholders 2024 2023
Operating cash flow $ 3.1 $ 11.1 Share repurchases $ - $ -
Dividends 4.8 4.5
Capital expenditures (6.4 ) (6.7 ) Cash returns to shareholders $ 4.8 $ 4.5
Free cash flow $ (3.3 ) $ 4.4
Cash at period end $ 117.9 $ 127.0
(1) See the reconciliation of the non-GAAP metrics at the end of the release.
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NEWS RELEASE - May 1, 2024
Page 3
First Quarter ended March 31, 2024 Compared to Same Period of 2023
. Total sales down 18.1%, comp-store sales down 18.5% for the quarter. Total written
sales were down 12.6% and written comp-store sales declined 13.0% for the quarter.
. Gross profit margins increased to
60.3%
in
2024
from
59.1%
in
2023
.
. SG&A expenses were
59.4%
of sales versus
52.7%
and decreased $
9.0
million. The primary drivers of this change are:
decrease of $4.8 million in selling expenses, primarily variable costs tied
to commissioned-based compensation expense and third-party creditor costs.
decrease in warehouse and delivery costs of $3.2 million primarily from
reduced headcount via attrition and lower expenditures for supplies and fuel.
decrease of $0.6 million in advertising expenses driven by reduced spending on
television and interactive marketing partly offset by increased technology costs.
Balance Sheet and Cash Flow for the Three Months ended March 31, 2024
. Cash, cash equivalents, and restricted cash equivalents at
March 31, 2024
are
$117.9
million.
. Generated $
3.1
million in cash from operating activities primarily from earnings
and changes in working capital including a $5.1 million increase in
customer deposits, a $1.9 million reduction in inventories, and a
$12.8 million decrease in vendor repayments and accrued liabilities.
. Invested $
6.4
million in capital expenditures.
. Paid $
4.8
million in quarterly cash dividends.
. No debt outstanding at
March 31, 2024
and credit availability of
$80.0
million.
Expectations and Other
. We are increasing our expectations for gross profit margins for
2024
to be between
60.0%
to
60.5%
. The adjustment is based on our merchandising mix and anticipated changes in product and freight
costs. Gross profit margins fluctuate quarter to quarter in relation to our promotional cadence.
. Fixed and discretionary expenses within SG&A for the full year of
2024
are expected to be in the
$290.0
to
$292.0
million range, a reduction in our previous guidance related to advertising and other
costs. Variable SG&A expenses for the full year of 2024 are anticipated to be in the
19.9%
to
20.2%
range.
. Our effective tax rate for
2024
is expected to be 26.5% excluding the impact from discrete items and any new tax legislation.
. Planned capital expenditures for the full year of
2024
are approximately
$32.0
million. We expect retail square footage will increase approximately 3.4% in
2024
over
2023
.
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NEWS RELEASE - May 1, 2024
Page 4
HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended
March 31,
(In thousands, except per share data) 2024 2023
Net sales $ 183,997 $ 224,754
Cost of goods sold 72,978 91,969
Gross profit 111,019 132,785
Expenses:
Selling, general and administrative 109,356 118,361
Other expense (income), net 23 (4 )
Total expenses 109,379 118,357
Income before interest and income taxes 1,640 14,428
Interest income, net 1,555 1,010
Income before income taxes 3,195 15,438
Income tax expense 802 3,066
Net income $ 2,393 $ 12,372
Basic earnings per share:
Common Stock $ 0.15 $ 0.77
Class A Common Stock $ 0.13 $ 0.72
Diluted earnings per share:
Common Stock $ 0.14 $ 0.74
Class A Common Stock $ 0.13 $ 0.71
Cash dividends per share:
Common Stock $ 0.30 $ 0.28
Class A Common Stock $ 0.28 $ 0.26
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NEWS RELEASE - May 1, 2024
Page 5
HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands) March 31, December 31, March 31,
2024 2023 2023
Assets
Current assets
Cash and cash equivalents $ 111,818 $ 120,635 $ 120,170
Restricted cash and cash equivalents 6,045 7,142 6,876
Inventories 92,078 93,956 114,254
Prepaid expenses 17,361 17,067 11,430
Other current assets 13,697 12,793 19,590
Total current assets 240,999 251,593 272,320
Property and equipment, net 173,128 171,588 139,212
Right-of-use lease assets 196,976 202,306 207,673
Deferred income taxes 15,594 15,641 16,332
Other assets 13,832 13,005 12,878
Total assets $ 640,529 $ 654,133 $ 648,415
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable $ 16,980 $ 18,781 $ 15,632
Customer deposits 40,912 35,837 46,382
Accrued liabilities 35,681 46,289 40,372
Current lease liabilities 37,572 37,357 36,180
Total current liabilities 131,145 138,264 138,566
Noncurrent lease liabilities 174,680 180,397 185,866
Other liabilities 28,014 27,106 27,571
Total liabilities 333,839 345,767 352,003
Stockholders' equity 306,690 308,366 296,412
Total liabilities and stockholders' equity $ 640,529 $ 654,133 $ 648,415
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NEWS RELEASE - May 1, 2024
Page 6
HAVERTY FURNITURE COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands) Three Months Ended
March 31,
2024 2023
Cash Flows from Operating Activities:
Net income $ 2,393 $ 12,372
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 4,946 4,362
Share-based compensation expense 2,643 1,957
Other 58 (840 )
Changes in operating assets and liabilities:
Inventories 1,878 4,079
Customer deposits 5,075 (1,587 )
Other assets and liabilities (1,104 ) 5,721
Accounts payable and accrued liabilities (12,754 ) (14,990 )
Net cash provided by operating activities 3,135 11,074
Cash Flows from Investing Activities:
Capital expenditures (6,399 ) (6,655 )
Proceeds from sale of land, property and equipment 48 13
Net cash used in investing activities (6,351 ) (6,642 )
Cash Flows from Financing Activities:
Dividends paid (4,845 ) (4,528 )
Taxes on vested restricted shares (1,853 ) (2,788 )
Net cash used in financing activities (6,698 ) (7,316 )
Decrease in cash, cash equivalents and restricted cash equivalents during the period (9,914 ) (2,884 )
Cash, cash equivalents and restricted cash equivalents at beginning of period 127,777 129,930
Cash, cash equivalents and restricted cash equivalents at end of period $ 117,863 $ 127,046
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NEWS RELEASE - May 1, 2024
Page 7
GAAP to Non-GAAP Reconciliation
We report our financial results in accordance with accounting principles
generally accepted in the United States ("GAAP"). We supplement the reporting
of our financial information under GAAP with certain non-GAAP financial
information. The non-GAAP information presented provides additional useful
information but should not be considered in isolation or as substitutes for
the related GAAP measures. We believe that EBITDA is a meaningful measure to
share with investors.
Reconciliation of GAAP measures to EBITDA
Three Months Ended March 31,
(in thousands) 2024 2023
Income before income taxes, as reported $ 3,195 $ 15,438
Interest income, net (1,555 ) (1,010 )
Depreciation 4,946 4,362
EBITDA $ 6,586 $ 18,790
Comparable Store Sales/
Comparable-store or "comp-store" sales is a measure which indicates the
performance of our existing stores and website by comparing the sales growth
for stores and online for a particular month over the corresponding month in
the prior year. Stores are considered non-comparable if they were not open
during the corresponding month or if the selling square footage has been
changed significantly.
Cost of Goods Sold and SG&A Expense/
We include substantially all our occupancy and home delivery costs in SG&A
expense as well as a portion of our warehousing expenses./ Accordingly, our
gross profit may not be comparable to those entities that include these costs
in cost of goods sold./
/
We classify our SG&A expenses as either variable or fixed and discretionary./
Our variable expenses are comprised of selling and delivery costs./ Selling
expenses are primarily compensation and related benefits for our commission-base
d sales associates, the discount we pay for third party financing of customer
sales and transaction fees for credit card usage./ We do not outsource
delivery, so these costs include personnel, fuel, and other expenses related
to this function./ Fixed and discretionary expenses are comprised of rent,
depreciation and amortization and other occupancy costs for stores, warehouses
and offices, and all advertising and administrative costs./
Conference Call Information
The company invites interested parties to listen to the live webcast of the
conference call on May 2, 2024 at 10:00 a.m. ET at its website,
ir.havertys.com
. If you cannot listen live, a replay will be available on the day of the
conference call at the website at approximately 1:00 p.m. ET.
About Havertys
Havertys (NYSE: HVT and HVT.A), established in 1885, is a full-service home
furnishings retailer with 124 showrooms in 17 states in the Southern and
Midwestern regions providing its customers with a wide selection of quality
merchandise in middle to upper-middle price ranges. Additional information is
available on the Company's website
havertys.com
./
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NEWS RELEASE - May 1, 2024
Page 8
Safe Harbor
/
This press release contains, and the conference call may contain forward-looking
statements subject to the safe harbor provisions of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Act of 1934. These
forward-looking statements are subject to risks and uncertainties and change
based on various important factors, many of which are beyond our control.
All statements in the future tense and all statements accompanied by words
such as "expect," "likely," "outlook," "forecast," "preliminary," "would,"
"could," "should," "position," "will," "project," "intend," "plan," "on
track," "anticipate," "to come," "may," "possible," "assume," and variations
of such words and similar expressions are intended to identify such
forward-looking statements. These forward-looking statements include, without
limitation, our expectations for retail and operating margins, selling square
footage and capital expenditures for
2024
, our liquidity position to continue to fund our growth plans, and our efforts
and initiatives to execute our strategic plan.
/
We caution that our forward-looking statements involve risks and uncertainties,
and while we believe that our expectations for the future are reasonable in
view of currently available information you are cautioned not to place undue
reliance on our forward-looking statements, and they should not be relied upon
as a prediction of actual results. Factors that could cause actual results to
differ materially from those expressed or implied in any forward-looking
statements include, but are not limited to: disruptions in our suppliers'
operations; changes in national and international legislation or government
regulations or policies, including changes to import tariffs and the
unpredictability of such changes; failure of vendors to meet our quality
control standards or to react to changes in legislative or regulatory
frameworks; disruptions in our distribution centers; changes in general
economic conditions, including unemployment, inflation (including the impact
of tariffs); labor shortages and the Company's ability to successfully attract
and retain employees in the current labor market; uncertain credit markets and
other macroeconomic conditions; competitive product, service and pricing
pressures; failure or weakness in our disclosure controls and procedures and
internal controls over financial reporting; disruptions caused by a failure or
breach of the Company's information systems and information technology
infrastructure, as well as other risks and uncertainties discussed in the
Company's Annual Report on Form 10-K for
2023
and from time to time in the Company's subsequent filings with the SEC.
Forward-looking statements describe our expectations only as of the date they
are made, and the Company undertakes no duty to update its forward-looking
statements except as required by law. You are advised, however, to review any
further disclosures we make on related subjects in our subsequent Forms 10-K,
10-Q, 8-K, and other reports filed with the SEC./
Contact:
Havertys 404-443-2900
Jenny Hill Parker
SVP, Finance, and Corporate Secretary
SOURCE: Havertys
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