Bassett Announces Third Quarter 2005 Earnings.BASSETT Bassett is a surname, and may refer to:
in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : BSET BSET Bachelor of Science in Engineering Technology BSET Building Systems Engineering Technology BSET Berhampur School of Engineering and Technology ) announced today its earnings for its fiscal quarter ended August 27, 2005. Sales for the third quarter of 2005 were $82.7 million, up 5.3 percent from third quarter 2004 levels, led by a $5 million or 12 percent increase in shipments to Bassett Furniture Direct (BFD BFD Big Freakin' Deal (polite form) BFD Bidirectional Forwarding Detection (IP networking) BFD Binary File Descriptor (computer programming) ) stores, which outpaced approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $4 million of expected attrition Attrition The reduction in staff and employees in a company through normal means, such as retirement and resignation. This is natural in any business and industry. Notes: with traditional furniture stores. Additionally, the acquisition of the Dallas Dallas, city (1990 pop. 1,006,877), seat of Dallas co., N Tex., on the Trinity River near the junction of its three forks; inc. 1871. The second largest Texas city, after Houston, and the eighth largest U.S. BFD stores impacted net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight by approximately $3 million in the third quarter of 2005. The Bassett Furniture Direct retail store program continues to grow with 127 stores currently in operation. Licensees opened six stores during the third quarter. The Company expects licensees to open another four to five stores in the fourth quarter for a total of 20 or 21 new BFD stores in fiscal 2005. Sales to BFD stores were 67 percent of total wholesale shipments in the first nine months of 2005 compared to 58 percent in the first nine months of 2004. "We are pleased with the growth of our Bassett Furniture Direct program and the continued strong performance from our upholstery upholstery, general term for household fittings, hangings, curtains, cushions, and covers. It refers to stuffed, padded, and spring-cushioned furniture, such as chairs and sofas, or to the usually decorative materials and fabrics that cover them. division and imported products within our wood division," said Robert Robert, Henry Martyn 1837-1923. American army engineer and parliamentary authority. He designed the defenses for Washington, D.C., during the Civil War and later wrote Robert's Rules of Order (1876). Noun 1. H. Spilman Jr., president and chief executive officer. "Our focus is squarely square·ly adv. 1. Mathematics At right angles: sawed the beam squarely. 2. In a square shape. 3. on retail and utilizing our expanded group of Corporate stores to build a platform for operational excellence which will serve the entire BFD store program." Margins for the quarter and year are up due to both the increase in Company-owned BFD retail sales and an improved sales mix sales mix See product mix. of imported products. SG&A expenses were also up due to the addition of Company-owned BFD stores and increases in marketing spending. The Company reported net income for the quarter of $1.9 million or $.16 per share including impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charges of $1.7 million (pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern ) for the previously announced acquisitions and consolidations of seven BFD stores (three in Upstate NY and four in Atlanta Atlanta (ətlăn`tə, ăt–), city (1990 pop. 394,017), state capital and seat of Fulton co., NW Ga., on the Chattahoochee R. and Peachtree Creek, near the Appalachian foothills; inc. 1847. , Ga.). This compares to net income of $1.1 million or $.10 per share including a $1.2 million pretax charge for a plant closing in the third quarter of 2004. Excluding the respective charges, net income was $3.0 million or $.25 per share in the third quarter of 2005 compared to net income of $1.9 million or $.16 per share in the third quarter of 2004. A reconciliation to the net income and earnings per share calculations has been set forth below. The Company acquired the Upstate NY BFD operations and a controlling interest controlling interest The ownership of a quantity of outstanding corporate stock sufficient to control the actions of the firm. Controlling interest often involves ownership of significantly less than 51% of a firm's outstanding stock because many owners fail in its Atlanta licensee licensee n. a person given a license by government or under private agreement. (See: license, licensor) LICENSEE. One to whom a license has been given. 1 M. Q. & S. 699 n. and has accounted for these transactions using the purchase method of accounting. The $1.7 million charge reflects the excess of cash paid and liabilities assumed over the fair market value of net assets Net assets The difference between total assets on the one hand and current liabilities and noncapitalized long-term liabilities on the other hand. net assets See owners' equity. acquired (primarily inventories, fixed assets fixed assets npl → activo sg fijo fixed assets npl → immobilisations fpl fixed assets fix npl → and recorded goodwill). For the year, the Company has acquired 15 Company-owned stores bringing its total number of Company-owned stores to 27, 21% of the 127 store network. The Company does not anticipate acquiring or consolidating any additional BFD stores this year. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. , net income for 2005 is $5.3 million or $.44 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share including $4.2 million of year-to-date pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta impairment charges. This compares to $5.3 million or $.45 per diluted share including pre-tax restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). and impaired asset Impaired Asset An asset with a market value that is worth less than its book value. Notes: If the sum of all estimated future cash flows is less than the carrying value of the asset, then the asset would be considered impaired and would have to be written down to its fair charges of $4.1 million and a $3.9 million gain on the sale of property for the first nine months of fiscal 2004. Excluding the respective charges and prior year gain, year-to-date net income is $7.9 million or $.66 per share which compares to $5.4 million or $.46 per share in 2004. A reconciliation to the net income and earnings per share calculations has been set forth below. The Company has generated positive operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. for the year through a combination of earnings and reductions in domestic wood inventories. The Company paid its regular quarterly dividend to shareholders during the quarter. Bassett also announced that its Board of Directors has declared de·clare v. de·clared, de·clar·ing, de·clares v.tr. 1. To make known formally or officially. See Synonyms at announce. 2. To state emphatically or authoritatively; affirm. 3. a regular quarterly dividend of $.20 per share payable on December December: see month. 1, 2005, to shareholders of record on November November: see month. 15, 2005. Bassett Furniture Industries, Inc. is a leading manufacturer and marketer of high quality, mid-priced home furnishings furnishings the extra type or quantity of hair on the head, tail, ears or legs, specified for a particular breed. For example, the feathers in setters, the beard in Bearded collies, the eyebrows in Schnauzers. . With over 125 Bassett Furniture Direct stores, Bassett has leveraged its strong brand name in furniture into a growing network of owned and licensed stores that focus on providing consumers with a friendly environment for buying furniture and accessories. The most significant growth vehicle for Bassett continues to be the Company's dedicated retail store program. Bassett's retail strategy encompasses affordable custom-built cus·tom-built adj. Built according to the specifications of the buyer. custom-built or -made Adjective made according to the specifications of an individual customer Noun furniture that is ready for delivery in the home within 30 days. The stores also feature the latest on-trend furniture styles, more than 1,000 upholstery fabrics, free in-home in-home adj. Operating in or provided at the home of the customer or patient: in-home shopping; an in-home nursing program. design visits, and coordinated decorating accessories. For more information, visit the Company's website at www.bassettfurniture.com. The Company has included the "as adjusted" information because it uses, and believes that others may use, such information in comparing the Company's operating results from period to period. However, the items excluded in determining the "as adjusted" information are significant components in understanding and assessing the Company's overall financial performance for the periods covered. Certain of the statements in this release, particularly those preceded by, followed by or including the words "believes," "expects," "anticipates," "intends," "should," "estimates," or similar expressions, or those relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc or anticipating financial results for periods beyond the end of the third quarter of 2005, constitute "forward looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. . For those statements, Bassett claims the protection of the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. for forward looking statements contained in the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. In many cases, Bassett cannot predict what factors would cause actual results to differ materially from those indicated in the forward looking statements. Expectations included in the forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. are based on preliminary information as well as certain assumptions which management believes to be reasonable at this time. The following important factors affect Bassett and could cause those results to differ materially from those expressed in the forward looking statements: economic, competitive, governmental and other factors identified in Bassett's filings with the Securities and Exchange Commission, and the effects of national and global economic or other conditions and future events on the retail demand for home furnishings.
BASSETT FURNITURE INDUSTRIES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements ofIncome - Unaudited
(In thousands, except for per share data)
13 Weeks Ended 13 Weeks Ended
August 27, August 28,
2005 2004
------------------------------
Percent Percent
of Net of Net
Amount Sales Amount Sales
------------------------------
Net sales $82,743 100.0% $78,585 100.0%
Cost of sales 57,276 69.2% 58,495 74.4%
------------- --------------
Gross profit 25,467 30.8% 20,090 25.6%
------------- --------------
Selling, general and administrative 23,517 28.4% 19,009 24.2%
Restructuring and impaired asset charges 1,739 2.1% 1,220 1.6%
------------- --------------
Income (loss) from operations 211 0.3% (139) -0.2%
Other income, net 2,307 2.8% 1,585 2.0%
------------- --------------
Income before income taxes 2,518 3.0% 1,446 1.8%
Income tax provision (632) -0.8% (318) -0.4%
------------- --------------
Net income $ 1,886 2.3% $ 1,128 1.4%
============= ==============
Basic earnings per share: $ 0.16 $ 0.10
======= =======
Diluted earnings per share: $ 0.16 $ 0.10
======= =======
BASSETT FURNITURE INDUSTRIES, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Income - Unaudited
(In thousands, except for per share data)
39 Weeks Ended 39 Weeks Ended
August 27, August 28,
2005 2004
--------------------------------
Percent Percent
of Net of Net
Amount Sales Amount Sales
--------------------------------
Net sales $246,557 100.0% $235,508 100.0%
Cost of sales 177,644 72.0% 175,332 74.4%
-------------- ---------------
Gross profit 68,913 28.0% 60,176 25.6%
-------------- ---------------
Selling, general and administrative 64,005 26.0% 57,289 24.3%
Gain on sale of property - 0.0% (3,890) -1.7%
Restructuring and impaired asset
charges 4,204 1.7% 4,060 1.7%
-------------- ---------------
Income from operations 704 0.3% 2,717 1.2%
Other income, net 6,115 2.5% 4,499 1.9%
-------------- ---------------
Income before income taxes 6,819 2.8% 7,216 3.1%
Income tax provision (1,522) -0.6% (1,876) -0.8%
-------------- ---------------
Net income 5,297 2.1% 5,340 2.3%
============== ===============
Basic earnings per share: $ 0.45 $ 0.46
======== ========
Diluted earnings per share: $ 0.44 $ 0.45
======== ========
BASSETT FURNITURE INDUSTRIES, INC. AND SUBSIDIARIES
Reconciliation of Net Income as Reported
to Net Income as Adjusted (Unaudited)
(In thousands, except for per share data)
39 39
Weeks Weeks
Ended Ended
Aug. 27, Aug.28,
2005 2004
------- --------
Net income as reported $5,297 $ 5,340
Gain on sale of property, net of income taxes (a) - (2,412)
Restructuring and impaired asset charges, net of
income taxes (a) 2,606 2,517
------ -------
Net income as adjusted $7,903 $ 5,445
====== =======
Reconciliation of Earnings Per Share as Reported
to Earnings Per Share as Adjusted (Unaudited)
39 39
Weeks Weeks
Ended Ended
Aug. 27, Aug. 28,
2005 2004
------- --------
Diluted earnings per share $ 0.44 $ 0.45
Gain on sale of property, net of income taxes (a) - (0.20)
Restructuring and impaired asset charges, net of
income taxes (a) 0.22 0.21
------ -------
Diluted earnings per share as adjusted $ 0.66 $ 0.46
====== =======
Reconciliation of Net Income as Reported
to Net Income as Adjusted (Unaudited)
(In thousands, except for per share data)
13 13
Weeks Weeks
Ended Ended
Aug. 27, Aug. 28,
2005 2004
------- --------
Net income as reported $1,886 $ 1,128
Restructuring and impaired asset charges, net of
income taxes (a) 1,078 756
------ -------
Net income as adjusted $2,964 $ 1,884
====== =======
Reconciliation of Earnings Per Share as Reported
to Earnings Per Share as Adjusted (Unaudited)
13 13
Weeks Weeks
Ended Ended
Aug. 27, Aug.28,
2005 2004
------- --------
Diluted earnings per share $ 0.16 $ 0.10
Restructuring and impaired asset charges, net of
income taxes (a) 0.09 0.06
------ -------
Diluted earnings per share as adjusted $ 0.25 $ 0.16
====== =======
(a) Adjustments to net income for both years are taxed
at a 38% blended rate.
BASSETT FURNITURE INDUSTRIES, INC. AND
SUBSIDIARIES
Consolidated Balance Sheets
(In thousands, except share and per share data)
(Unaudited)
Assets Aug. 27, Nov. 27
2005 2004
----------- ---------
Current assets
Cash and cash equivalents $ 5,057 $ 4,022
Accounts receivable, net 42,182 40,507
Inventories 49,827 47,285
Deferred income taxes 3,410 4,130
Assets held for sale 1,213 2,753
Other current assets 3,878 3,980
-------- --------
Total current assets 105,567 102,677
-------- --------
Property and equipment, net 39,959 40,243
-------- --------
Investments 77,321 73,520
Retail real estate, net 55,989 53,085
Notes receivable, net 14,186 14,642
Other, net 17,855 13,199
-------- --------
165,351 154,446
-------- --------
Total assets $310,877 $297,366
======== ========
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable $ 19,968 $ 19,948
Accrued liabilities 25,954 18,601
-------- --------
Total current liabilities 45,922 38,549
-------- --------
Long-term liabilities
Employee benefits 9,215 9,423
Long-term debt 6,318 -
Real estate notes payable 15,261 15,604
Distributions in excess of affiliate earnings 13,729 12,578
-------- --------
44,523 37,605
-------- --------
Commitments and Contingencies
Stockholders' equity
Common stock, par value $5 a share, 50,000,000
shares authorized, issued and
outstanding - 11,777,505 in 2005
and 11,681,792 in 2004 58,989 58,680
Retained earnings 156,557 158,341
Additional paid-in-capital 2,100 1,373
Accumulated other comprehensive income -
unrealized holding gains, net of income tax 2,786 2,818
-------- --------
Total stockholders' equity 220,432 221,212
-------- --------
Total liabilities and stockholders' equity $310,877 $297,366
======== ========
BASSETT FURNITURE INDUSTRIES, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows - Unaudited
(In thousands)
39 Weeks 39 Weeks
Ended Ended
Aug. 27, Aug. 27,
2005 2004
-------------------
Operating Activities
Net income $ 5,297 $ 5,340
Adjustments to reconcile net income to net cash
provided
by operating activities:
Depreciation and amortization 7,043 7,534
Equity in undistributed income of
investments (8,027) (6,817)
Provision for write-down of impaired
assets 4,204 2,353
Provision for losses on trade accounts
receivable 1,809 900
Net gain from sales of investments (908) (1,215)
Net gain from sales of property and
equipment - (3,890)
Deferred income taxes (328) 360
Changes in employee benefit liabilities (208) (295)
Changes in operating assets and
liabilities, exclusive of assets
and liabilities impacted by a
business combination:
Trade accounts receivable (10,780) (1,632)
Inventories 3,895 (7,822)
Other current assets 340 (341)
Notes receivable, net (1,917) (105)
Accounts payable and accrued
liabilities 1,370 3,234
-------- --------
Net cash provided by (used in) operating
activities 1,790 (2,396)
-------- --------
Investing Activities
Purchases of property and equipment, net (2,739) (3,262)
Purchases of retail real estate (4,474) (5,938)
Proceeds from sales of property and equipment 1,613 8,342
Proceeds from sales of investments 11,407 10,726
Purchases of investments (9,815) (17,021)
Acquisition of retail licensee stores, net of
cash acquired (1) 67 -
Dividends from an affiliate 5,623 5,623
Other, net 232 1,099
-------- --------
Net cash provided by (used in)
investing activities 1,914 (431)
-------- --------
Financing Activities
Borrowings under revolving credit arrangement 4,000 -
Repayments of real estate notes payable (581) (105)
Issuance of common stock, net 983 1,857
Repurchases of common stock - (772)
Cash dividends (7,071) (7,007)
-------- --------
Net cash used in financing
activities (2,669) (6,027)
-------- --------
Net change in cash and cash equivalents 1,035 (8,854)
-------- --------
Cash and cash equivalents, beginning of period 4,022 15,181
-------- --------
Cash and cash equivalents, end of period $ 5,057 $ 6,327
======== ========
(1) Cash acquired, net of cash paid for the acquisition of retail
licensee stores in Atlanta, Upstate New York and Dallas was $67.
On a non-cash basis, these transactions included consolidating
$6,663 of current assets, $2,380 of fixed assets, $6,629 of
current liabilities, and $2,414 of long- term debt.
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