Nobility Homes (NOBH) 10-Q 20 Mar 23 2023 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	Feb. 04, 2023	Mar. 17, 2023
Cover [Abstract]
Document Type	10-Q
Document Transition Report	false
Document Quarterly Report	true
Amendment Flag	false
Document Period End Date	Feb. 04, 2023
Entity Registrant Name	NOBILITY HOMES, INC.
Entity Central Index Key	0000072205
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Trading Symbol	NOBH
Current Fiscal Year End Date	--11-05
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		3,370,912
Entity File Number	000-06506
Entity Incorporation, State or Country Code	FL
Entity Address, Address Line One	3741 S.W. 7th Street
Entity Address, City or Town	Ocala
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	34474
City Area Code	352
Local Phone Number	732-5157
Title of 12(b) Security	Common Stock
Entity Interactive Data Current	Yes
Entity Tax Identification Number	59-1166102

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Feb. 04, 2023	Nov. 05, 2022
Current assets:
Cash and cash equivalents	$ 17,849,343	$ 16,653,449
Certificates of deposit	5,853,611	3,903,888
Short-term investments	571,129	589,071
Accounts receivable - trade	1,923,352	1,288,645
Note receivable	23,905	23,905
Mortgage notes receivable	4,197	16,191
Inventories	23,319,061	23,457,493
Prepaid expenses and other current assets	1,925,767	2,172,675
Total current assets	51,470,365	48,105,317
Property, plant and equipment, net	8,102,965	7,915,695
Note receivable, less current portion	10,898	16,599
Mortgage notes receivable, less current portion	143,320	131,514
Other investments	1,871,719	1,848,893
Deferred income taxes	43,778	43,778
Cash surrender value of life insurance	4,187,060	4,143,035
Other assets	156,287	156,287
Total assets	65,986,392	62,361,118
Current liabilities:
Accounts payable	798,894	1,119,188
Accrued compensation	1,054,664	1,132,423
Accrued expenses and other current liabilities	1,873,724	1,742,696
Income taxes payable	1,161,041	229,200
Customer deposits	10,082,580	10,214,078
Total current liabilities	14,970,903	14,437,585
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.10 par value, 500,000 shares authorized; none issued and outstanding
Common stock, $.10 par value, 10,000,000 shares authorized; 5,364,907 shares issued; 3,370,912 shares outstanding, respectively	536,491	536,491
Additional paid in capital	10,884,676	10,849,687
Retained earnings	66,498,779	63,441,812
Less treasury stock at cost, 1,993,995 shares	(26,904,457)	(26,904,457)
Total stockholders' equity	51,015,489	47,923,533
Total liabilities and stockholders' equity	$ 65,986,392	$ 62,361,118

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Feb. 04, 2023	Nov. 05, 2022
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 10	$ 10
Preferred stock, shares authorized	500,000	500,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 10	$ 10
Common stock, shares authorized	10,000,000	10,000,000
Common stock, shares issued	5,364,907	5,364,907
Common Stock, shares outstanding	3,370,912	3,370,912
Treasury stock, shares	1,993,995	1,993,995

Condensed Consolidated Statemen

Condensed Consolidated Statements of Income - USD ($)	3 Months Ended
	Feb. 04, 2023	Feb. 05, 2022
Income Statement [Abstract]
Net sales	$ 17,164,753	$ 10,808,270
Cost of sales	(11,293,157)	(8,080,042)
Gross profit	5,871,596	2,728,228
Selling, general and administrative expenses	(2,035,477)	(1,416,543)
Operating income	3,836,119	1,311,685
Other income (loss):
Interest income	140,033	74,680
Undistributed earnings in joint venture - Majestic 21	22,826	12,557
Proceeds received under escrow arrangement	0	118,045
Decrease in fair value of equity investment	(17,942)	(4,093)
Miscellaneous	7,772	13,556
Total other income	152,689	214,745
Income before provision for income taxes	3,988,808	1,526,430
Income tax expense	(931,841)	(369,396)
Net income	$ 3,056,967	$ 1,157,034
Net income per share:
Basic	3,370,912	3,532,803
Diluted	3,371,418	3,544,584
Basic	$ 0.91	$ 0.33
Diluted	$ 0.91	$ 0.33

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($)	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Treasury Stock [Member]
Balance at Nov. 06, 2021	$ 49,314,305	$ 536,491	$ 10,766,253	$ 59,742,759	$ (21,731,198)
Balance, shares at Nov. 06, 2021		3,532,100
Treasury stock purchase	(9,197)				(9,197)
Treasury stock purchase, shares		(270)
Stock-based compensation	35,353		33,218		2,135
Stock-based compensation, shares		180
Exercise of employee stock options			(17,452)		17,452
Exercise of employee stock options, shares		966
Net income	1,157,034			1,157,034
Balance at Feb. 05, 2022	50,497,495	$ 536,491	10,782,019	60,899,793	(21,720,808)
Balance, shares at Feb. 05, 2022		3,532,976
Balance at Nov. 05, 2022	47,923,533	$ 536,491	10,849,687	63,441,812	(26,904,457)
Balance, shares at Nov. 05, 2022		3,370,912
Stock-based compensation	34,989		34,989		0
Stock-based compensation, shares		0
Net income	3,056,967			3,056,967
Balance at Feb. 04, 2023	$ 51,015,489	$ 536,491	$ 10,884,676	$ 66,498,779	$ (26,904,457)
Balance, shares at Feb. 04, 2023		3,370,912

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($)	3 Months Ended
	Feb. 04, 2023	Feb. 05, 2022
Cash flows from operating activities:
Net income	$ 3,056,967	$ 1,157,034
Adjustments to reconcile net income to net cash provide by operating activities:
Depreciation	39,279	43,227
Undistributed earnings in joint venture - Majestic 21	(22,826)	(12,557)
Decrease in fair market value of equity investments	17,942	4,093
Stock-based compensation	34,989	35,353
Amortization of operating lease right of use assets	0	1,597
Decrease (increase) in:
Accounts receivable - trade	(634,707)	186,724
Inventories	138,432	(193,311)
Prepaid expenses and other current assets	246,908	202,697
Interest receivable	(33,723)	0
(Decrease) increase in:
Accounts payable	(320,294)	58,905
Accrued compensation	(77,759)	37,776
Accrued expenses and other current liabilities	131,028	(88,108)
Income taxes payable	931,841	369,396
Customer deposits	(131,498)	(877,796)
Net cash provided by operating activities	3,376,579	925,030
Cash flows from investing activities:
Purchase of property, plant and equipment	(226,549)	(118,783)
Purchase certificates of deposit	(1,916,000)
Proceeds from certificates of deposit	0	2,087,936
Collections on interest receivable	0	5,079
Collections on mortgage notes receivable	188	627
Collections on equipment and other notes receivable	5,701	14,443
Issuance of mobile home park note receivable	0	(63,778)
Increase in cash surrender value of life insurance	(44,025)	(42,759)
Net cash (used in) provided by investing activities	(2,180,685)	1,882,765
Cash flows from financing activities:
Reduction of operating lease obligation	0	(1,597)
Net cash used in financing activities	0	(1,597)
Increase in cash and cash equivalents	1,195,894	2,806,198
Cash and cash equivalents at beginning of year	16,653,449	36,126,059
Cash and cash equivalents at end of quarter	17,849,343	38,932,257
Supplemental disclosure of cash flow information:
Noncash exercise of employee stock options	$ 0	$ (9,197)

Basis of Presentation and Accou

Basis of Presentation and Accounting Policies	3 Months Ended
	Feb. 04, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation and Accounting Policies	Note 1 Basis of Presentation and Accounting Policies The accompanying unaudited condensed financial statements for the three months ended February 4, 2023 and February 5, 2022 have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission for Form 10-Q. The unaudited financial information included in this report includes all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary to reflect a fair statement of the results for the interim periods. The results of operations for the three months ended February 4, 2023 and February 5, 2022 are not necessarily indicative of the results of the full fiscal year. The condensed consolidated financial statements included in this report should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K

Inventories

Inventories	3 Months Ended
	Feb. 04, 2023
Inventory Disclosure [Abstract]
Inventories	Note 2 Inventories New home inventory is carried at a lower of cost or net realizable value. The cost of finished home inventories determined on the specific identification method is removed from inventories and recorded as a component of cost of sales at the time revenue is recognized. In addition, an allocation of depreciation and amortization is included in the cost of goods sold. Under the specific identification method, if finished home inventory can be sold for a profit there is no basis to write down the inventory below the lower of cost or net realizable value. Other pre-owned st st st st st st Inventory held at consignment locations by affiliated entities is included in the Company’s inventory on the Company’s consolidated balance sheets. Consigned inventory was $126,953 and $318,590 as of February 4, 2023 and November 5, 2022, respectively. Pre-owned trade-ins (Trade-in Trade-in Other inventory costs are determined on a first-in, first-out A breakdown of the elements of inventory at February 4, 2023 and November 5, 2022 is as follows: February 4, November 5, 2023 2022 (unaudited) Raw materials $ 1,628,321 $ 2,199,372 Work-in-process 134,762 135,513 Inventory consigned to affiliated entities 126,953 318,590 Finished homes - Nobility 8,994,169 9,583,095 Finished homes - Other 11,441,369 10,432,998 Pre-owned 794,133 682,254 Model home furniture 199,354 185,671 Inventories $ 23,319,061 $ 23,537,493

Short-term Investments

Short-term Investments	3 Months Ended
	Feb. 04, 2023
Investments, Debt and Equity Securities [Abstract]
Short-term Investments	Note 3 Short-term Investments The following is a summary of short-term investments (available for sale): February 4, 2023 (unaudited) Cost Gross Gross Estimated Equity securities in a public company $ 167,930 $ 403,199 $ — $ 571,129 November 5, 2022 Cost Gross Gross Estimated Equity securities in a public company $ 167,930 $ 421,141 $ — $ 589,071 The fair values were estimated based on quoted market prices in active markets at each respective period end.

Fair Value of Financial Instrum

Fair Value of Financial Instruments	3 Months Ended
	Feb. 04, 2023
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	Note 4 Fair Value of Financial Instruments The carrying amount of cash and cash equivalents, accounts and notes receivable, accounts payable and accrued expenses approximates fair value because of the short maturity of those instruments. The Company accounts for the fair value of financial investments in accordance with FASB Accounting Standards Codification (ASC) No. 820 “Fair Value Measurements” (ASC 820). ASC 820 defines fair value as the price that would be received upon the sale of an asset or paid to transfer a liability (i.e. exit price) in an orderly transaction between market participants at the measurement date. ASC 820 requires disclosures that categorize assets and liabilities measured at fair value into one of three different levels depending on the assumptions (i.e. inputs) used in the valuation. Financial assets and liabilities are classified in their entirety based on the lowest level of input significant to the fair value measurement. The ASC 820 fair value hierarchy is defined as follows: • Level 1 - Valuations are based on unadjusted quoted prices in active markets for identical assets or liabilities. • Level 2 - Valuations are based on quoted prices for similar assets or liabilities in active markets, or quoted prices in markets that are not active for which significant inputs are observable, either directly or indirectly. • Level 3 - Valuations are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management’s best estimate of what market participants would use in valuing the asset or liability at the measurement date. The following tables represent the Company’s financial assets and liabilities which are carried at fair value. February 4, 2023 (unaudited) Level 1 Level 2 Level 3 Equity securities in a public company $ 571,129 $ — $ — November 5, 2022 Level 1 Level 2 Level 3 Equity securities in a public company $ 589,071 $ — $ —

Net Income per Share

Net Income per Share	3 Months Ended
	Feb. 04, 2023
Earnings Per Share [Abstract]
Net Income per Share	Note 5 Net Income per Share These financial statements include “basic” and “diluted” net income per share information for all periods presented. The basic net income per share is calculated by dividing net income by the weighted-average number of shares outstanding. The diluted net income per share is calculated by dividing net income by the weighted-average number of shares outstanding, adjusted for dilutive common shares.

Revenues by Products and Servic

Revenues by Products and Service	3 Months Ended
	Feb. 04, 2023
Segment Reporting [Abstract]
Revenues by Products and Service	Note 6 Revenues by Products and Service The Company operates in one business segment, which is manufactured housing and ancillary services. Revenues by net sales from manufactured housing homes and insurance agent commissions are as follows: (unaudited) Three Months Ended February 4, February 5, 2023 2022 Manufactured housing Homes sold through Company owned sales centers $ 15,279,220 $ 9,839,992 Homes sold to independent dealers and through manufactured home parks, net 1,809,925 901,290 $ 17,089,145 $ 10,741,282 Insurance agent commissions 75,608 66,988 Total net sales $ 17,164,753 $ 10,808,270

Inventories (Tables)

Inventories (Tables)	3 Months Ended
	Feb. 04, 2023
Inventory Disclosure [Abstract]
Summary of Breakdown of Elements of Inventory	A breakdown of the elements of inventory at February 4, 2023 and November 5, 2022 is as follows: February 4, November 5, 2023 2022 (unaudited) Raw materials $ 1,628,321 $ 2,199,372 Work-in-process 134,762 135,513 Inventory consigned to affiliated entities 126,953 318,590 Finished homes - Nobility 8,994,169 9,583,095 Finished homes - Other 11,441,369 10,432,998 Pre-owned 794,133 682,254 Model home furniture 199,354 185,671 Inventories $ 23,319,061 $ 23,537,493

Short-term Investments (Tables)

Short-term Investments (Tables)	3 Months Ended
	Feb. 04, 2023
Investments, Debt and Equity Securities [Abstract]
Summary of Short-term Investments	The following is a summary of short-term investments (available for sale): February 4, 2023 (unaudited) Cost Gross Gross Estimated Equity securities in a public company $ 167,930 $ 403,199 $ — $ 571,129 November 5, 2022 Cost Gross Gross Estimated Equity securities in a public company $ 167,930 $ 421,141 $ — $ 589,071

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	3 Months Ended
	Feb. 04, 2023
Fair Value Disclosures [Abstract]
Summary of Assets and Liabilities Measured at Fair Value	The following tables represent the Company’s financial assets and liabilities which are carried at fair value. February 4, 2023 (unaudited) Level 1 Level 2 Level 3 Equity securities in a public company $ 571,129 $ — $ — November 5, 2022 Level 1 Level 2 Level 3 Equity securities in a public company $ 589,071 $ — $ —

Revenues by Products and Serv_2

Revenues by Products and Service (Tables)	3 Months Ended
	Feb. 04, 2023
Segment Reporting [Abstract]
Revenues by Net Sales	Revenues by net sales from manufactured housing homes and insurance agent commissions are as follows: (unaudited) Three Months Ended February 4, February 5, 2023 2022 Manufactured housing Homes sold through Company owned sales centers $ 15,279,220 $ 9,839,992 Homes sold to independent dealers and through manufactured home parks, net 1,809,925 901,290 $ 17,089,145 $ 10,741,282 Insurance agent commissions 75,608 66,988 Total net sales $ 17,164,753 $ 10,808,270

Inventories - Additional Inform

Inventories - Additional Information (Detail) - USD ($)	Feb. 04, 2023	Nov. 05, 2022
Inventory Disclosure [Abstract]
Inventory Consigned To Affiliated Entities	$ 126,953	$ 318,590

Inventories - Summary of Breakd

Inventories - Summary of Breakdown of Elements of Inventory (Detail) - USD ($)	Feb. 04, 2023	Nov. 05, 2022
Inventory Disclosure [Abstract]
Raw materials	$ 1,628,321	$ 2,199,372
Work-in-process	134,762	135,513
Inventory consigned to affiliated entities	126,953	318,590
Finished homes – Nobility	8,994,169	9,583,095
Finished homes – Other	11,441,369	10,432,998
Pre-owned homes	794,133	682,254
Model home furniture	199,354	185,671
Inventories	$ 23,319,061	$ 23,537,493

Short-term Investments - Summar

Short-term Investments - Summary of Short-term Investments (Detail) - USD ($)	Feb. 04, 2023	Nov. 05, 2022
Investments, Debt and Equity Securities [Abstract]
Available-for-sale Securities, Amortized Cost	$ 167,930	$ 167,930
Available-for-sale Securities, Gross Unrealized Gains	403,199	421,141
Available-for-sale Securities, Gross Unrealized Losses	0	0
Available-for-sale Securities, Estimated Fair Value	$ 571,129	$ 589,071

Fair Value of Financial Instr_3

Fair Value of Financial Instruments - Summary of Assets and Liabilities Measured at Fair Value on a Recurring Basis (Detail) - USD ($)	Feb. 04, 2023	Nov. 05, 2022
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Equity securities in a public company	$ 571,129	$ 589,071
Level 1 [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Equity securities in a public company	571,129	589,071
Level 2 [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Equity securities in a public company	0	0
Level 3 [Member]
Fair Value Assets And Liabilities Measured On Recurring Basis [Line Items]
Equity securities in a public company	$ 0	$ 0

Revenues by Products and Serv_3

Revenues by Products and Service - Revenues by Net Sales (Detail) - USD ($)	3 Months Ended
	Feb. 04, 2023	Feb. 05, 2022
Sales Information [Line Items]
Total net sales	$ 17,164,753	$ 10,808,270
Manufactured Housing [Member]
Sales Information [Line Items]
Total net sales	17,089,145	10,741,282
Manufactured Housing [Member] | Homes sold through Company owned sales centers [Member]
Sales Information [Line Items]
Total net sales	15,279,220	9,839,992
Manufactured Housing [Member] | Homes sold to independent dealers and through manufactured home parks, net [Member]
Sales Information [Line Items]
Total net sales	1,809,925	901,290
Insurance Agent Commissions [Member]
Sales Information [Line Items]
Total net sales	$ 75,608	$ 66,988