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8-K - FORM 8-K - NOBILITY HOMES INCd258535d8k.htm

Exhibit 99.1

 

LOGO

NOBILITY HOMES, INC. ANNOUNCES INCREASE IN SALES AND EARNINGS FOR ITS THIRD QUARTER 2016

Ocala, FL…September 13, 2016—Today Nobility Homes, Inc. (OTCQX: NOBH) announced increased sales and earnings results for its third quarter ended July 30, 2016. Sales for third quarter 2016 were up 39% to $9,779,621 as compared to $7,059,263 recorded in third quarter 2015. Income from operations was up 58% to $1,240,492 versus $787,272 last year. Net income after taxes was $894,271 as compared to $746,770 last year. Diluted earnings per share were $0.22 per share compared to $0.18 per share last year.

For the first nine months of fiscal 2016, sales were up 31% to $25,269,511 as compared to $19,342,181 for the first nine months of 2015. Income from operations was up 69% to $3,170,102 versus $1,872,811 last year. Net income after taxes was $5,244,553 compared to $1,907,111 last year. Diluted earnings per share were $1.30 per share compared to $0.47 per share last year.

Nobility’s financial position for the first nine months of 2016 remains very strong with cash and cash equivalents and short term investments of $22,730,960 and no outstanding debt. Working capital is $31,353,487 and our ratio of current assets to current liabilities is 9.7:1. Stockholders’ equity is $44,154,178 and the book value per share of common stock outstanding increased to $10.98.

Terry Trexler, President, stated, “The demand for affordable manufactured housing in Florida and the U.S. is improving. According to the Florida Manufactured Housing Association, shipments in Florida for the period from November 2015 through July 2016 were up approximately 22% from the same period last year. Our sales and earnings continue to be affected by the challenging housing environment, the uncertainty of the U.S. and world economy, employment levels, consumer confidence and, in particular, the lack of available retail and wholesale financing. Constrained consumer credit and the lack of lenders in the industry, partly as a result of an increase in government regulations, have limited many affordable manufactured housing buyers from purchasing homes.

We understand that during this uncertain economic environment, maintaining our strong financial position is vital for future growth and success. Because of the recent years of very challenging business conditions in our market area, management will continue to evaluate all expenses and react in a manner consistent with maintaining our strong financial position, while exploring opportunities to expand our distribution and manufacturing operations.

Our many years of experience in the Florida market, combined with home buyers’ increased need for more affordable housing, should serve the Company well in the coming years. Management remains convinced that our specific geographic market is one of the best long-term growth areas in the country.”

The Company has specialized for over 49 years in the design and production of quality, affordable manufactured homes at its plant located in central Florida. With multiple retail sales centers, an insurance subsidiary, and an investment in a retirement manufactured home community, we are the only vertically integrated manufactured home company headquartered in Florida.

MANAGEMENT WILL NOT HOLD A CONFERENCE CALL. IF YOU HAVE ANY QUESTIONS, PLEASE CALL TERRY OR TOM TREXLER @ 800-476-6624 EXT 221 OR TERRY@NOBILITYHOMES.COM OR TOM@NOBILITYHOMES.COM

Certain statements in this report are forward-looking statements within the meaning of the federal securities laws. Although Nobility believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, there are risks and uncertainties that may cause actual results to differ materially from expectations. These risks and uncertainties include, but are not limited to, competitive pricing pressures at both the wholesale and retail levels, increasing material costs, continued excess retail inventory, increase in repossessions, changes in market demand, changes in interest rates, availability of financing for retail and wholesale purchasers, consumer confidence, adverse weather conditions that reduce sales at retail centers, the risk of manufacturing plant shutdowns due to storms or other factors, the impact of marketing and cost-management programs, reliance on the Florida economy, impact of labor shortage, impact of materials shortage, increasing labor cost, cyclical nature of the manufactured housing industry, impact of rising fuel costs, catastrophic events impacting insurance costs, availability of insurance coverage for various risks to Nobility, market demographics, management’s ability to attract and retain executive officers and key personnel, increased global tensions, market disruptions resulting from terrorist or other attack and any armed conflict involving the United States and the impact of inflation.


NOBILITY HOMES, INC.

Consolidated Balance Sheets

 

     July 30,     October 31,  
     2016     2015  
     (Uaudited)        

Assets

    

Current assets:

    

Cash and cash equivalents

   $ 22,308,809      $ 16,769,292   

Short-term investments

     422,151        462,578   

Accounts receivable - trade

     3,077,283        2,937,922   

Note receivable

     500,000        —     

Mortgage notes receivable

     9,164        9,851   

Income tax receivable

     —          335   

Inventories

     6,280,367        6,019,705   

Pre-owned homes

     1,245,653        1,366,974   

Prepaid expenses and other current assets

     495,754        826,180   

Deferred income taxes

     613,568        655,193   
  

 

 

   

 

 

 

Total current assets

     34,952,749        29,048,030   

Property, plant and equipment, net

     4,702,882        3,964,878   

Pre-owned homes

     2,283,336        2,724,190   

Interest receivable

     27,997        —     

Note receivable, less current portion

     2,030,000        —     

Mortgage notes receivable, long term

     175,135        177,644   

Other investments

     1,341,263        2,243,729   

Deferred income taxes

     —          1,210,630   

Cash surrender value of life insurance

     3,050,468        2,915,469   

Other assets

     156,287        156,287   
  

 

 

   

 

 

 

Total assets

   $ 48,720,117      $ 42,440,857   
  

 

 

   

 

 

 

Liabilities and Stockholders’ Equity

    

Current liabilities:

    

Accounts payable

   $ 413,320      $ 704,467   

Accrued compensation

     378,862        390,573   

Accrued expenses and other current liabilities

     926,971        926,204   

Income taxes payable

     675,037        —     

Customer deposits

     1,205,072        1,323,861   
  

 

 

   

 

 

 

Total current liabilities

     3,599,262        3,345,105   

Deferred income taxes

     966,677        —     
  

 

 

   

 

 

 

Total liabilities

     4,565,939        3,345,105   
  

 

 

   

 

 

 

Commitments and contingent liabilities

    

Stockholders’ equity:

    

Preferred stock, $.10 par value, 500,000 shares authorized; none issued and outstanding

     —          —     

Common stock, $.10 par value, 10,000,000 shares authorized; 5,364,907 shares issued

     536,491        536,491   

Additional paid in capital

     10,662,414        10,650,723   

Retained earnings

     42,737,630        37,493,077   

Accumulated other comprehensive income

     207,297        247,724   

Less treasury stock at cost, 1,344,700 shares in 2016 and 1,333,338 shares in 2015

     (9,989,654     (9,832,263
  

 

 

   

 

 

 

Total stockholders’ equity

     44,154,178        39,095,752   
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 48,720,117      $ 42,440,857   
  

 

 

   

 

 

 


NOBILITY HOMES, INC.

Consolidated Statements of Comprehensive Income

Unaudited

 

     Three Months Ended     Nine Months Ended  
     July 30,     August 1,     July 30,     August 1,  
     2016     2015     2016     2015  

Net sales

   $ 9,779,621      $ 7,059,263      $ 25,269,511      $ 19,342,181   

Cost of goods sold

     (7,599,070     (5,495,061     (19,366,957     (15,067,042
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     2,180,551        1,564,202        5,902,554        4,275,139   

Selling, general and administrative expenses

     (940,059     (776,930     (2,732,452     (2,402,328
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     1,240,492        787,272        3,170,102        1,872,811   
  

 

 

   

 

 

   

 

 

   

 

 

 

Other income (loss):

        

Interest income

     43,155        10,437        77,246        40,409   

Undistributed earnings in joint venture - Majestic 21

     28,429        37,212        97,539        106,027   

Proceeds received under escrow arrangement

     —          —          788,566        —     

Losses from investments in retirement

        

community limited partnerships

     —          (89,053     —          (146,403

Gain on sale of investment in retirement community

     —          —          3,990,000        —     

Miscellaneous

     5,559        1,030        25,404        39,896   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other income (loss)

     77,143        (40,374     4,978,755        39,929   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before provision for income taxes

     1,317,635        746,898        8,148,857        1,912,740   

Income tax expense

     (423,364     (128     (2,904,304     (5,629
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

     894,271        746,770        5,244,553        1,907,111   

Other comprehensive income (loss)

        

Unrealized investment gain (loss)

     (13,176     28,035        (40,427     (1,009
  

 

 

   

 

 

   

 

 

   

 

 

 

Comprehensive income

   $ 881,095      $ 774,805      $ 5,204,126      $ 1,906,102   
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighed average number of shares outstanding:

        

Basic

     4,022,311        4,048,554        4,023,689        4,058,106   

Diluted

     4,023,714        4,048,994        4,024,739        4,058,540   

Net income per share:

        

Basic

   $ 0.22      $ 0.18      $ 1.30      $ 0.47   

Diluted

   $ 0.22      $ 0.18      $ 1.30      $ 0.47