Hooker Furniture Corporation (HOFT) has reported a 39.50 percent jump in profit for the quarter ended Oct. 30, 2016. The company has earned $6.46 million, or $0.56 a share in the quarter, compared with $4.63 million, or $0.43 a share for the same period last year.
Revenue during the quarter surged 122.38 percent to $145.30 million from $65.34 million in the previous year period. Gross margin for the quarter contracted 652 basis points over the previous year period to 21.28 percent. Total expenses were 93.16 percent of quarterly revenues, up from 89.84 percent for the same period last year. That has resulted in a contraction of 332 basis points in operating margin to 6.84 percent.
Operating income for the quarter was $9.94 million, compared with $6.64 million in the previous year period.
"For the third quarter in a row, we improved top and bottom line performance," said Paul B. Toms Jr., chairman and chief executive officer. "Sales were up sequentially from the second quarter about $9 million, and we are encouraged by robust incoming orders in the last five to six weeks, driven by orders of new product introductions from the October High Point Market. Post-market orders in our legacy Hooker Casegoods Segment and Hooker Upholstery division have been particularly strong."
Operating cash flow improves significantly
Hooker Furniture Corporation has generated cash of $31.26 million from operating activities during the nine month period, up 85.20 percent or $14.38 million, when compared with the last year period.
The company has spent $87.62 million cash to meet investing activities during the nine month period as against cash outgo of $2.83 million in the last year period.
Cash flow from financing activities was $45.54 million for the nine month period as against cash outgo of $3.24 million in the last year period.
Cash and cash equivalents stood at $43.11 million as on Oct. 30, 2016, down 12.87 percent or $6.37 million from $49.47 million on Nov. 01, 2015.
Working capital increases sharply
Hooker Furniture Corporation has recorded an increase in the working capital over the last year. It stood at $138.49 million as at Oct. 30, 2016, up 26.46 percent or $28.98 million from $109.51 million on Nov. 01, 2015. Current ratio was at 3.40 as on Oct. 30, 2016, down from 7.57 on Nov. 01, 2015.
Cash conversion cycle (CCC) has decreased to 45 days for the quarter from 110 days for the last year period. Days sales outstanding went down to 32 days for the quarter compared with 41 days for the same period last year.
Days inventory outstanding has decreased to 30 days for the quarter compared with 86 days for the previous year period. At the same time, days payable outstanding was almost stable at 17 days for the quarter, when compared with the previous year period.
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