Tuesday, residential furniture manufacturer Hooker Furniture Corp. (HOFT) reported second-quarter fiscal year 2009 net income that halved from the year-ago period sending the stock spiraling downwards by 8.65% to $16.90 in after-hours trading session. The decline is primarily due to reduction in net sales and higher operational expenses leading to a decline in gross profit margin.
The Martinsville, Virginia-based company reported second quarter net income of $2.07 million or $0.18 per share compared to $4.86 million or $0.39 per share in the corresponding quarter last year.
The decline is primarily attributed to reduction in net sales and increase in selling and administrative expenses as a percentage of net sales to 23.9% compared with 20.5% of sales for the prior year quarter. Gross profit margin for the latest quarter declined to 28.3% of sales from 31.3% of sales reported in the corresponding quarter last year. The company incurred a restructuring and asset impairment charge of $0.26 million for the second quarter of fiscal year 2009 compared to a gain of $0.47 million in the corresponding period last year.
Other income for the second-quarter reported was $168,000 compared to $308,000 in the preceding year.
Net sales for the second quarter decreased 12% to $64.63 million from $73.44 million in the prior-year corresponding period. Nearly 40% of sales decline for the 2009 second-quarter is related to discontinued domestically-produced wood furniture apart from lower unit volume attributed to the industry-wide business slump and lower average selling prices.
For the six-month period, net income decreased to $4.68 million or $0.41 per share from $9.14 million or $0.71 per share in the similar period last year. Net sales decreased to $135.66 million from $150.74 million in the comparable fiscal year last year.
Cash and cash equivalents declined by $17.3 million to $15.8 million as of August 3, 2008 from $33.1 million on February 3, 2008. The company used $14.1 m cash to repurchase approximately 798,000 shares of its common stock based on authorization from board of directors since late last year.
Hooker closed Tuesday's regular trading at $18.50, down $0.34 or 1.80%, on a volume of 100,434 shares on the Nasdaq.
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