Hooker Furniture looks to preserve capital after posting losses

Net sales decreased $28.2 million to $93.6 million in the quarter, a decline of more than 23%, compared to the prior years’s first quarter.

The 100-year-old company posted a consolidated operating loss of $5.2 million across all segments, primarily due to lower sales.

Cash levels remain at approximately $41 million and company officials said they would focus on maintaining a healthy financial position and balance sheet as the current industry-wide downturn continues.

The company expected to be profitable in the longterm as it begins to implement cost reductions plans resulting in a 10% reduction of fixed costs beginning in the second half of fiscal 2025.

“The ongoing weak demand that’s adversely impacting the furniture industry made our first quarter challenging,” said Jeremy Hoff, chief executive officer, in a release. “However, we remain confident that the strategies we are pursuing in operations, marketing and merchandising are transformative. Times like these present an opportunity to recalibrate and even reinvent aspects of our business.”

Hooker Branded segment net sales were down over 18% and incoming orders during the quarter declined by 13%.

Home Meridian segment net sales were down 36% in the fiscal 2025 first quarter, attributed to liquidation sales after exiting the business last year and a decrease in sales.

The Domestic Upholstery segment net sales were down nearly 15%.

“Given the uncertainty in the furniture industry and the general economy, we remain committed to our capital allocation policy. Our short-term capital allocation strategy is focused on preserving capital until we begin to see an industry-turnaround, while also protecting our 50-plus year history of quarterly dividends and continuing to invest in organic growth,” said Chief Financial Officer Paul Huckfeldt in the release. “We believe we have a conservative balance sheet, which can help us weather the current demand environment, but understand the need for caution in a cyclical industry like ours.”

Hooker Furnishings presented its fiscal 2025 first quarter financial results via teleconference and live internet webcast on Thursday. The company, in its 100th year of business, designs, markets and imports casegoods (wooden and metal furniture) leather furniture, fabric-upholstered furniture, lighting, accessories, and home decor for the residential, hospitality and contract markets.