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Dec 31, 2019
Haverty Furniture Q4 2019 Earnings Report
Havertys' Q4 2019 earnings decreased compared to the same period last year, but sales increased slightly.
Key Takeaways
Havertys reported a sales increase of 2.3% for Q4 2019 compared to Q4 2018, with comparable store sales up by 1.4%. However, net earnings decreased due to an impairment loss for a retail store. The company is addressing supply chain disruptions caused by the coronavirus outbreak and remains optimistic about future growth.
Sales increased by 2.3% compared to Q4 2018.
Comparable store sales increased by 1.4%.
Net earnings decreased due to an impairment loss.
Customer average ticket rose 8.5% over the 2018 fourth quarter.
Forward Guidance
Havertys anticipates a gross profit margin of 54.6% for FY 2020, with fluctuations expected throughout the year. Fixed and discretionary expenses within SGA are projected to be in the range of $265.0 to $267.0 million. Capital expenditures are planned at $17.0 million, including investments in new stores and information technology. Variable SGA expenses are anticipated to be in the 18.4% to 18.6% range as a percent of sales. The effective tax rate for 2020 is expected to be 25%, excluding the impact from the vesting of stock-based awards.
Positive Outlook
- Gross profit margin expected to be 54.6% for FY 2020.
- Investments planned for new stores in Myrtle Beach, SC and Dallas/Ft. Worth, TX.
- Capital expenditures include $4.0 million for information technology.
- Effective tax rate for 2020 expected to be 25%, excluding stock-based awards.
- Variable SGA expenses anticipated to be in the 18.4% to 18.6% range.
Challenges Ahead
- Gross profit margins expected to run 30 to 60 basis points lower in the first half of the year.
- Fixed and discretionary expenses within SGA are expected to increase to $265.0 to $267.0 million.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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