NOBILITY HOMES INC.
P.O. Box 1659 OCALA, FLORIDA 34478 352-732-5157 www.nobilityhomes.com
NOBILITY HOMES ANNOUNCES SALES AND
EARNINGS FOR ITS SECOND QUARTER
Ocala, FL...June 5, 2003...NOBILITY HOMES, INC. (NASDAQ-NMS SYMBOL
NOBH) today announced sales and earnings results for its second quarter ended
May 3, 2003. Sales in the second quarter of fiscal 2003 were $8,354,762 as
compared to $8,945,759 recorded in the second quarter of fiscal 2002. Income
from operations for the second quarter of this year was $859,972 versus $996,520
in the same period last year. The decrease in sales was a result of
approximately $800,000 less sales to our outside independent dealers. The lower
income from operations was a result of less sales. This quarter the
Company-owned retail sales centers' model home inventory was increased to a more
normal stocking level and there were more retail sold homes in various stages of
completion prior to final funding. Net income was $677,231 versus last year's
results of $770,834, which included a collection of $100,000 (pre-tax) on a
previously fully reserved note receivable. Earnings per share for the second
quarter were $.17 per share versus $.19 per share last year.
For the first six months of fiscal 2003, sales were $16,837,177 as
compared to sales of $17,234,207 in the first six months of last fiscal year.
Income from operations for the first six months was $1,734,359 versus $1,723,310
in the same period last year. Net income was $1,277,814 or $.32 per share versus
last year's results of $1,363,768 or $.33 per share.
Nobility's financial position continues to improve during fiscal year
2003 and remains very strong with cash and cash equivalents and marketable
securities of $12,349,688 and no outstanding debt. Working capital increased to
$18,391,386 and our current assets to current liabilities is 5.9:1.
Shareholders' equity is $24,923,637 and the book value per share of common stock
increased to $6.25. The Company purchased 29,700 shares of its common stock
during the first six months and is authorized by the Company's Board of
Directors to purchase up to 100,000 additional shares of the Company's stock in
the open market.
Terry Trexler, President, stated, "Second quarter sales of fiscal 2003
continued to be impacted by the very competitive market caused by the industry's
excess inventory, high repossession rate, tight retail credit standards, and
uncertain economic conditions in our market area. In the near term, we
anticipate continued pressure on both sales and earnings resulting from these
factors, but remain convinced that our specific geographic market is one of the
best long-term growth areas in the country and, because of the strong operating
leverage inherent in our Company, we remain cautiously optimistic for the
remainder fiscal 2003. With an improving economy, better consumer confidence,
and continued low interest rates, management expects the demand for our homes to
improve as the industry's excess home inventory, repossessions and retail sales
centers are reduced. The Company is well positioned to capitalize on the demand
in the future by controlling the retail distribution, financing and insuring of
our homes and by being financially sound to take advantage of opportunities as
they develop."
Nobility Homes, Inc. has specialized for the past 36 years in the
design and production of quality, affordable, manufactured homes at its two
plants located in central Florida. With seventeen Company owned retail sales
centers, a finance company joint venture, and an insurance subsidiary, Nobility
is the only vertically integrated manufactured home company headquartered in
Florida.
MANAGEMENT WILL HOLD A CONFERENCE CALL ON THURSDAY, JUNE 5, 2003, AT
4:30 PM EASTERN TIME. TO PARTICIPATE, PLEASE DIAL 800-231-9012. THE
CONFIRMATION CODE FOR THE CALL IS 370824. YOU MAY ALSO ACCESS THE CALL AT
www.nobilityhomes.com OR
http://www.firstcall events.com/service/ajwz382939204gf12.html
Certain statements in this report are forward-looking statements within the
meaning of the federal securities laws. Although the Company believes that the
expectations reflected in such forward-looking statements are based on
reasonable assumptions, there are risks and uncertainties that may cause actual
results to differ materially from expectations. These risks and uncertainties
include, but are not limited to, general economic conditions, competitive
pricing pressures at both the wholesale and retail levels, changes in market
demand, adverse weather conditions that reduce sales at retail centers, the risk
of manufacturing plant shutdowns due to storms or other factors, and the impact
of marketing and cost-management programs. (Comparative Tables Follow)
NOBILITY HOMES, INC.
CONSOLIDATED BALANCE SHEETS
May 3, 2003 November 2, 2002
------------------- --------------------
(Unaudited)
ASSETS
- ------
Current Assets:
Cash and cash equivalents $ 10,931,366 $ 12,481,711
Marketable securities 1,418,322 -
Accounts receivable - trade 844,154 1,074,481
Inventories 7,890,727 6,589,076
Deferred income taxes 554,234 608,700
Prepaid expenses and other current assets 494,921 368,129
------------- -------------
Total current assets 22,133,724 21,122,097
Property, plant and equipment, net 2,965,508 2,948,096
Investment in joint venture - Majestic 21 1,130,619 1,020,056
Deferred income taxes - noncurrent 22,700 22,700
Other assets 2,413,424 2,383,425
------------- -------------
Total assets $ 28,665,975 $ 27,496,374
============= =============
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 929,206 $ 1,178,395
Accrued expenses and other current liabilities 2,310,847 1,834,965
Accrued compensation 371,184 704,122
Income taxes payable 131,101 -
------------- -
Total current liabilities 3,742,338 3,717,482
------------- -------------
Commitments and contingencies liabilities
Stockholders' equity:
Preferred stock, $.10 par value, 500,000
shares authorized, none issued - -
Common stock, $.10 par value, 10,000,000
shares authorized; 5,364,907 shares issued 536,491 536,491
Additional paid in capital 8,629,144 8,629,144
Retained earnings 23,699,697 22,421,883
Other comprehensive income 127,089 -
Less treasury stock at cost, 1,377,394 and
1,347,694 shares, respectively, in 2003 and 2002 (8,068,784) (7,808,626)
------------- -------------
Total stockholders' equity 24,923,637 23,778,892
------------- -------------
Total liabilities and stockholders' equity $ 28,665,975 $ 27,496,374
============= =============
NOBILITY HOMES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended Six Months Ended
------------------ ----------------
May 3, May 4, May 3, May 4,
2003 2002 2003 2002
--------------- --------------- -------------- ---------------
Net sales $ 8,354,762 $ 8,945,759 $ 16,837,177 $ 17,189,882
Net sales - related parties - - - 44,325
------------ ------------ ------------ ------------
Total net sales 8,354,762 8,945,759 16,837,177 17,234,207
Cost of goods sold (6,127,236) (6,588,885) (12,386,221) (12,769,258)
------------ ------------ ------------ ------------
Gross profit 2,227,526 2,356,874 4,450,956 4,464,949
Selling, general and administrative expenses (1,331,554) (1,360,354) (2,716,597) (2,741,639)
------------ ------------ ------------ ------------
Operating income 895,972 996,520 1,734,359 1,723,310
------------ ------------ ------------ ------------
Other income:
Interest income 43,239 42,272 83,536 100,923
Undistributed earnings in joint venture -
Majestic 21 88,997 39,121 110,563 144,506
Gain on recovery of TLT, Inc. note receivable - 100,000 - 100,000
Miscellaneous 8,023 6,921 17,356 11,029
------------ ------------ ------------ ------------
140,259 188,314 211,455 356,458
------------ ------------ ------------ ------------
Income before provision for income taxes 1,036,231 1,184,834 1,945,814 2,079,768
Provision for income taxes (359,000) (414,000) (668,000) (716,000)
------------ ------------ ------------ ------------
Net income $ 677,231 $ 770,834 $ 1,277,814 $ 1,363,768
============ ============ ============ ============
Weighted average shares outstanding
Basic 3,996,175 4,124,513 4,005,210 4,128,323
Diluted 4,010,169 4,154,393 4,023,339 4,152,034
Earnings per share
Basic $ .17 $ .19 $ .32 $ .33
Diluted $ .17 $ .19 $ .32 $ .33