Bassett Furniture Industries (BSET) has reported a 72.58 percent jump in profit for the quarter ended May 27, 2017. The company has earned $5.84 million, or $0.54 a share in the quarter, compared with $3.38 million, or $0.31 a share for the same period last year.

Revenue during the quarter grew 6.99 percent to $114.12 million from $106.67 million in the previous year period. Gross margin for the quarter expanded 35 basis points over the previous year period to 60.59 percent. Total expenses were 93.34 percent of quarterly revenues, down from 94.51 percent for the same period last year. This has led to an improvement of 117 basis points in operating margin to 6.66 percent.

Operating income for the quarter was $7.60 million, compared with $5.85 million in the previous year period.

"Solid performances in all three of our operating segments paved the way for our strong showing in the second quarter", commented Robert H. Spilman, Jr., chairman and chief executive officer. "Our 7.0% increase in consolidated sales provided the leverage for us to grow operating profit by 30% despite heavier investments in our digital platform and marketing in general. We have a number of new strategic initiatives currently underway that are designed to drive sales growth. Given that we are now in our seventh consecutive year of positive comparable store sales in our corporate store network, we believe that increasing consumer exposure to the Bassett brand via store expansion and robust marketing programs will enable us to build on this track record and to continue to generate top line revenue growth in the future."

The company has spent $5.95 million cash to meet investing activities during the first six months as against cash outgo of $13.54 million in the last year period. It has incurred net capital expenditure of $9.11 million on net basis during the first six months, down 32.72 percent or $4.43 million from year ago period.

The company has spent $8.89 million cash to carry out financing activities during the first six months as against cash outgo of $4.01 million in the last year period.

Cash and cash equivalents stood at $29.80 million as on May 27, 2017, up 0.24 percent or $0.07 million from $29.73 million on May 28, 2016.

Working capital increases marginally

Bassett Furniture Industries has recorded an increase in the working capital over the last year. It stood at $67.51 million as at May 27, 2017, up 2.86 percent or $1.88 million from $65.63 million on May 28, 2016. Current ratio was at 1.94 as on May 27, 2017, down from 1.95 on May 28, 2016.

Cash conversion cycle (CCC) has decreased to 33 days for the quarter from 94 days for the last year period. Days sales outstanding were almost stable at 16 days for the quarter, when compared with the last year period.

Days inventory outstanding has decreased to 59 days for the quarter compared with 121 days for the previous year period. At the same time, days payable outstanding went down to 42 days for the quarter from 43 for the same period last year.