HVT - Earnings call transcript Q1 2021 | Haverty Furniture Companies, Inc.

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Operator

Good day, and welcome to the HVT's First Quarter 2021 Financial Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Richard Hare, Chief Financial Officer. Please go ahead.

Richard B. Hare

Thank you, operator.

we'll uncertainties. statements, call, to are conference and risks this make which forward-looking subject During may materially of results no statements, are Actual differ and obligation which in or made or speak such to implied publicly only revise. we as which the update they from date undertake those made Securities to Factors detailed reports company's in results economic and Commission. competitive differ the Exchange that could cause conditions and the filed include actual and uncertainties with other

update our an our Smith, will will now then Chairman President, results, Our CEO, our you and and Clarence provide give additional business. on Steve Burdette, commentary about

Clarence H. Smith

Good and at average seeing morning. our the conference results joining increased we last elevated with times continuing I'm XXXX though with call. closing first tickets. the first almost the quarter is and continuing traffic written year, sales, have backlog Thank quarter since higher and you are Even for the of up encouraged pleased orders we're We're rates undelivered that our January. very four with seen our pace current incoming higher momentum

of not furniture. or a slowing times even orders longer have We rates significantly higher for with the seen cancellation wait

subsidies the other cash of backlog and of large government the the orders, for see do value has trend because we how know strong we We XXXX this very we dramatic in housing the for and products. long dramatically orders, risen While believe in increases market, continue will increased of incoming believe home-related will the importance not the furniture home that and these the the year. past demand

longer-term elevated is the that home believe a also sustainable America. trend in of We importance

are additional orders Carolina past industry working in planning to a now, in teams product our suppliers this but network. flow warehouse excited are store our distribution South open our production bring are We the distribution shippers to investing beyond reduce and improves shipping The new increase record opened and in well this has they and are as merchandising and quarter backlog. the fill store our experienced. in challenges and villages summer. Beach, that in with a delays Florida Central the supply capacities anything our design-oriented been well-known to have tirelessly inventories to product and in Our Myrtle We're in

believe to expect about Texas a a Northeast third are We and major this opportunities. number there markets of quality and President, campaign a multimedia in investigating separate actively and now We store which to the of that footprint the new campaign additional the bar good raise open from May, competitors furniture on we serve our rollout over store can call Austin, in Steve the pursuing believe turn we our marketing new excited Havertys to very later distribution month. sharing be service, Burdette. more like on We'll are will We're our early next within design. more I'd year. clearly and

Steven G. Burdette

home operations delivery specifically, morning. Thank I'd chain efforts distribution, areas. our as well the to and as an supply during and our good update on you, Clarence, quarter, our provide service like

And surcharges Our supply costs freight container difficult. Dallas to us included we unreliable, headwinds, second inbound February's first to the arriving additional QX. product for during all in delays many upholstery at as situation to we chain receive capacity, were our versus were and XX% winter able distribution to their which product see bedding caused the storm our foam as center approached approximately with close in quarter. storm of delays Canal for week. receiving two operations experienced to impact caused on The Container of weeks. one New team scarcity. We delays, the manufacturers especially port up headwinds early the same faced of to further some quarter, faced some Suez Year LA of the part Even three suppliers, products Chinese finally, availability in which these production. caused more main our with we pricing impacted chemical for QX of vendors our due

We we exceed product match will of the in same expect flow that to QX. be able or

still delays are We experiencing the with container of in availability part some QX. early

new back production cost. which have back will to the been we freight be the Also, middle by our foam stability of to freight half of bedding big the domestic upholstery and able carriers, resume production which for our flow the However, in our the to to secure normal contracts bring will of May, a lift with should quarter.

delivery service week we all Memphis We DC Dallas did for masterful quarter. home faced deliveries had our within distribution, to stores and job headwinds one due cross the our close in by February. in to serviced in for and adjusting a winter the and teams storm docks same Cincinnati Our the to

year. normal to December made March, concern very storm. the in in the Staffing and warehouses many home unemployment to this to one in our talent industries that the a of Richard week it efforts challenge remains this and Extended the the I I number turn company, our Our along area. until benefits not of made operations partners first results our to unique it September, difficult checks now. our it our retain in appreciate delivery as it well as entire of this and resumed happen. distributed with being over quarter after the team vendor delivery. will economy. back I'm have is the pleased with This in is schedules for Havertys' stimulus challenge attract Overall, as

Richard B. Hare

Steve. you, Thank

the financial in prior $XXX.X the were delivered a for increase the XX.X% at over quarter sales quarter, million, our quarter. first of year Looking results XXXX,

a were last quarter of for If you first were the closed the XX.X% XXXX stores over quarter Total pandemic. retail prior the full is excluded. XXXX weeks in period. March written COVID-XX were recall, operations prior This month our so includes sales both the periods, of first for due up two the over were the up of year store XX.X% to open period. in sales year Comparable that

basis due increased and points offset XX.X% activity from mix merchandising, to increase XXX in margin gross sales Our as less the costs. increased freight by and partially promotional general and and million, we were XX.X% see $XX.X to primarily an to improvements during our better continue price administrative These quarter. product LIFO reserve, XX.X% increased increased Selling, $XXX.X to or due million to activity. expenses profit

costs these However, XXX percentage from sales, XX.X% basis a as of XX.X%. to points declined

demonstrated Income has $XX.X tax before past the model sales financial levels. As at increased our these quarters, in income million two to million. leverage substantial operating has $XX.X

in stock first or quarter from XXXX, to $XX.X of rate share common the vested state stock tax rate awards. in which income income million taxes The in per million $X and rate was an effective due the year. on resulted comparable last to of effective XX.X%. XXXX in the expense is quarter the tax of share of Net the our statutory benefit of Our difference million tax income the primary $X.XX the per or $X.X was diluted net for first compared quarter $X.XX and

$XXX.X balance XX, were first year's quarter, XXXX and our first up end At XXXX no at $XX.X our was $XX.X with quarter, the versus the December million the sheet XXXX down up At Now balance. $XX.X were last the the the which of million December our quarter customer $XXX of the We million, balance up balance and inventories debt quarter deposits versus million on million first our XX, cash sheet. quarter funded first have XXXX. balance million and million, was from of and $X.X the equivalents, ended QX $XXX.X of of of the end cash the balance. the which looking over at end we

CapEx the we of also first XXXX. quarter was of our $X cash of Looking the $X.X of paid and for dividends at quarter during flow. some uses million the million

any purchase During have We we this the buyback under program. million in our program. quarter, $XX.X currently first for common shares did authorization remaining not

Our certain please highlight earnings metrics. to future release I few, out additional financial commentary. forward-looking our release a statements list will press of additional expectations our but for refer several indicating

of between for anticipate margins expect changes We XX.X% in impacted margins We and and our estimate be profit reserve. and costs will to XX%. current XXXX product LIFO gross be by our our gross freight

delivery Our within slight fixed expected type slight are a to rising our variable to are costs. SG&A The benefit $XXX for costs expected in over over increase a SG&A quarter and due type the $XXX be based for increase to recent million costs. million to the XX.X% increases be selling range, XXXX range XXXX in in expenses and previous most to XX.X%, discretionary on XXXX estimate potential the of

investments and approximately our expected stores distribution Our new remains remodels million. $XX expected to to planned at for CapEx in be investments are $XX.X and our anticipated million, million; are network in $X.X replacement be information technology expansions million, account for $X.X XXXX

effective open from questions vesting tax expected awards would our legislation. today's in we impact call. to time. XXXX for call like of be first rate completes tax your the XX%. quarter. the Operator, the potential commentary stock is Thank This and new projection any on for you participation anticipated at in Our excludes This up now to this

Operator

with Sidoti Company. from We'll Instructions] take & first Anthony [Operator our question Lebiedzinski

Anthony Chester Lebiedzinski

taking and the morning you for questions. thank Good

So the certainly, here. in a quarter line impressive bottom and performance, very top both

storm? quarter revenue I'm you Just on winter to wondering, impact perhaps in as obviously didn't sense idea revenue of how be. called as - much terms even just trying of any was to the the a if would impact, terms what storm happen, out the winter that the with in get that

Steven G. Burdette

lost if on for that. would been after that that were to point, impacted the itself a deliveries side. as that were I'll retail we business I President's it don't strong. whole. tell far where and back it receiving the because Day from so Yes, did our President's were be total speculating, some open distribution were the know you, business stores to our sales. quarter, business but on do has and impacted We then but week as We Day, We At really happened the able Anthony, we this

Anthony Chester Lebiedzinski

for Thanks Okay. Yeah. Steve. that

the just biggest are that look you you as seeing far So, increases sell? segments, product your wondering areas as sales where you when the product at different

Clarence H. Smith

were - our But because that I able it's because case those to room, this through. in in think bedroom, starting been we was big come in. great we've see part And dining flowing category, goods. is it of increases interesting categories deliver Upholstery goods to I the We historically, been occasional. quarter, case in have the past think product. but and The case was were still goods the driver had strong that's the and to strongest

Richard B. Hare

as Clarence, during first the And percentage quarter and piggyback sales, year off were at it the of in to this in XX.X% of case of to XX.X% last quarter, a goods that, up just we went year.

Anthony Chester Lebiedzinski

then you and Yes. Okay. for me just here. for Thank question that, last

that are been chain? certainly where there, guys constraints are chain So, the specifically, in points looking supply out which guys at for you pressure the seeing different you terms well supply publicized, have greatest the of

Steven G. Burdette

tell same the volume we're Anthony, certainly, to now handle business this are you, vendors at have in with we the that is able able hurdles are and our having to be Steve. production being that pace. the hiring would and the keep people right to staff that right I up

upholstery of into impacted, But I us still and be quarter as business container we certainly the the The got pushed because capacity, as supply foam more to the we side as with we of hurt was an got with on for that the deal and First going said, out, that. the of impact had move of that issue that's quarter through the an third winter think still it because that storm. will got you do We've quarter, demand we then biggest but but increased that that's in we're toward our we our as out the expect the and that the out. end resolve And told about the fourth would toward our hopefully, to in side from that year because move here, on. I that's orders be quarter, distribution, itself, focused there. world, That what is be staffing of thing.

to able for vendors. have with out six coming on the supply to flow chain them team out we're the orders programmed And Our to meet in months demand. the be has

Anthony Chester Lebiedzinski

it. Got

you thank luck. much Well, best Okay. very and of

Clarence H. Smith

Thank you.

Operator

our Thomas Brad from We'll question next KeyBanc. take Instructions] [Operator with

Bradley Bingham Thomas

to morning. over make My first good on impressive quarter just of I'm sales Hi, question around right. the modeling understanding Really was growth Congrats some sales. just wanted XX%. great sure this here. I

of in running and year? when rate range the typically XX% been easy at look Is the that to written delivered north stores sales, reason comparison Is able was get to the months, you're you just trend XX% such those an think. where kind because that revenues same-store last to turning that works? into for orders XX% closed few we growth up mathematically I in had XX% of have last March total the and As how

Richard B. Hare

we then a part, performance about quarter, talked in backlog. how first - look good yeah. the the at - quarter the our we in the first give just last and that And orders is, but it Clarence the terms revenue position or could the most in got of For guidance, Steve how we about production is more take of quarter, fourth talked do can product as much we probably just quarter you. flow probably and forecasting over got for as don't

Clarence H. Smith

last Yeah, and in we March. two weeks the of were closed

that and for but only not - was delivery, stores, So for too.

jump, incoming was big seeing but we're consistent. So that I think the orders

So we feel pretty good about that.

Bradley Bingham Thomas

revenue number. a No, Yes. impressive just really

with and not your company fantastic have in strong. about as we XQ position very from Havertys the are historically, obviously deposits you're customer The backlog written think a orders perspective, in off come it so obviously looks a in has And had seasonally far too like highest from often sitting been XQ, history. revenues XQ

As sales able we in here is reason to deliver the think there couldn't of in the did what generate holds something about might neighborhood of value assuming demand generally maybe of any sales that up, XQ, be that dollar you XQ? in you you

Richard B. Hare

heading we Brad, process - look I and how give and in on looking in I the but revenue mean, did there's on right you. And the firm back again, that out thought that the - can't we you're Steve we first I'd don't Clarence the really at is probably think and guidance. direction, quarter. yeah, message back going backlog up for receipts, at gave go really our and our

Bradley Bingham Thomas

how just be this I Great. think could. buying you if out hear And be at is maybe all spending then probably? what I'd from if just of is can you consumer terms and of in curious, hear from how all, the field what evolving, customer is one, the customers what you last changing and you the sustainable

Clarence H. Smith

mentioned the goods I but across case the Well, coming are it's up, board.

biggest been mattresses what feel of in in in I and Housing that, also see states like for Texas supply Texas, think we has because weakest where are. good And our good. and there their was We we growth the Virginia, I don't the that I are and slowing about think, some home. strong. people furniture the of believe Florida, Florida particularly mean, growth down. issues. I is but Georgia, is

what good pretty So about are we do. home we house the is fact that and the where feel and important, we and that's

Bradley Bingham Thomas

good momentum great. and That's and keeping up much Thank you the here. congrats so luck

Clarence H. Smith

you, Thank Brad.

Richard B. Hare

Thanks, Brad.

Operator

At concludes question-and-answer remarks. conference to or for Financial back will That Officer, the Hare, today's Mr. Richard closing additional Chief session. over this I turn time,

Richard B. Hare

good release the we appreciate quarter and with your we today's we to Have Well, certainly look call, in you participation forward talking future when our in second a results. day.

Operator

This participation. concludes for Thank today's your call. you

disconnect. now may You

Haverty Furniture Companies (HVT) 2 May 212021 Q1 Earnings call transcript