Despite single-digit declines in sales and earnings in the fourth quarter, Hooker Furniture said profits rose more than 28% for the fiscal year that ended Jan. 31.

The company said the bottom-line improvement was driven by stronger gross margins and operational improvements in all of its business segments.

Sales for the 52-week fiscal year totaled $247 million, up 1.1% from $244.4 million the previous fiscal year.

Net income totaled $16.2 million or $1.49 per share, up from $12.6 million or $1.16 per share the previous fiscal year.

The company said sales in the fourth fiscal quarter fell 6.7% to $60.6 million, while net income fell 3.6% to $4.15 million or 38 cents per share.

Paul Toms Jr., chairman and CEO, said lower case goods and upholstery sales, as well as increased discounting in all segments, hampered fourth-quarter results.

“Our ability to improve profitability in all divisions despite a sluggish demand environment was the highlight of the year," said Toms. "While challenged with a soft incoming order rate over the last six months, we were able to improve multiple facets of the business and generate strong cash flow. ”

The latest numbers did not include results from Home Meridian International, a case goods and upholstery importer Hooker recently acquired. Toms said the $100 million acquisition closed Feb. 1, the first day of Hooker’s new fiscal year.

The company finished the fiscal year with $53.9 million in cash and cash equivalents and no long-term debt. Additionally, $13.3 million was available on its $15.0 million revolving credit facility, net of $1.7 million reserved for standby letters of credit. Consolidated inventories stood at $43.7 million, down $1.3 million from the fiscal 2015 year end.

"We did a good job of managing inventories throughout the year despite the downturn in order rates during the second half," Toms said. "Currently, our inventories are near target in terms of size and composition of best-sellers."

(Source: Furniture Today)