Friday, June 30, 2023
Bassett Furniture Industries, Incorporated manufactures, markets, and retails home furnishings in the United States. The company operates in three segments: Wholesale, Retail, and Logistical Services. It is involved in the design, manufacture, sourcing, sale, and distribution of furniture products to a network of company-owned and licensee-owned Bassett Home Furnishings (BHF) retail stores, as well as independent furniture retailers; and wood and upholstery operations. As of September 16, 2017, the company operated a network of 91 company-and licensee-owned stores. It also provides shipping, delivery, and warehousing services to customers in the furniture industry. In addition, the company owns and leases retail store properties. It also distributes its products through other multi-line furniture stores, Bassett galleries or design centers, specialty stores, and mass merchants. Bassett Furniture Industries was founded in 1902 and is based in Bassett, Virginia.
Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Mixed 2Q Results. Bassett missed our top line projections, with revenue of $100.5 million compared to our estimate of $102 million and down 22% y-o-y from $128.7 million. Operating income for the quarter was $2.7 million compared to $11.0 million last year. The Company beat our bottom line projection, however, with net income reported at $2.1 million compared to our estimate of $0.3 million, but down from last year’s $47.1 million. Excluding $39.4 million from discontinued operations, however, net income for last year would be $7.7 million.
Still a Challenging Environment. Higher cost inventory and soft demand is continuing to plague the environment for Bassett, as wholesale orders were down 18% y-o-y and written orders declined 17%. The Company did a price cut strategy on its Club Level motion inventories at the end of the first quarter to move inventory and are not expecting any further cuts.
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