HOFT 10-Q
HOOKER FURNISHINGS Corp (HOFT)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
For
the quarterly period ended
Commission
file number
(Exact name of registrant as specified in its charter)
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(Address of principal executive offices, zip code)
(
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Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated Filer ☐ | |
| Non-accelerated Filer ☐ | Smaller reporting company |
| Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
As
of September 4, 2026, there were
Table of Contents
| PART I. FINANCIAL INFORMATION | 1 | |
| Item 1. | Financial Statements | 1 |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 20 |
| Item 3. | Quantitative and Qualitative Disclosures about Market Risk | 32 |
| Item 4. | Controls and Procedures | 32 |
| PART II. OTHER INFORMATION | 33 | |
| Item 5. | Other Information | 33 |
| Item 6. | Exhibits | 33 |
| Signature | 34 | |
i
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
| August 2, | ||||||||
| 2026 | February 1, | |||||||
| As of | (unaudited) | 2026 | ||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Trade accounts receivable, net | ||||||||
| Inventories | ||||||||
| Income tax recoverable | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Total current assets | ||||||||
| Property, plant and equipment, net | ||||||||
| Cash surrender value of life insurance policies | ||||||||
| Deferred taxes | ||||||||
| Operating leases right-of-use assets | ||||||||
| Intangible assets, net | ||||||||
| Goodwill | ||||||||
| Other assets | ||||||||
| Total non-current assets | ||||||||
| Total assets | $ | $ | ||||||
| Liabilities and Shareholders’ Equity | ||||||||
| Current liabilities | ||||||||
| Trade accounts payable | $ | $ | ||||||
| Accrued salaries, wages and benefits | ||||||||
| Accrued income taxes | ||||||||
| Customer deposits | ||||||||
| Current portion of operating lease liabilities | ||||||||
| Other accrued expenses | ||||||||
| Total current liabilities | ||||||||
| Long term debt | ||||||||
| Deferred compensation | ||||||||
| Operating lease liabilities | ||||||||
| Total long-term liabilities | ||||||||
| Total liabilities | ||||||||
| Shareholders’ equity | ||||||||
| Common stock, no par value, |
||||||||
| Retained earnings | ||||||||
| Accumulated other comprehensive income | ||||||||
| Total shareholders’ equity | ||||||||
| Total liabilities and shareholders’ equity | $ | $ | ||||||
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
1
HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
| For the | For the | |||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net sales | $ | $ | $ | $ | ||||||||||||
| Cost of sales | ||||||||||||||||
| Gross profit | ||||||||||||||||
| Selling and administrative expenses | ||||||||||||||||
| Intangible asset amortization | ||||||||||||||||
| Operating income / (loss) | ( | ) | ( | ) | ||||||||||||
| Other income, net | ||||||||||||||||
| Interest expense, net | ||||||||||||||||
| Income / (Loss) from continuing operations before income taxes | ( | ) | ( | ) | ||||||||||||
| Income tax expense / (benefit) | ( | ) | ( | ) | ||||||||||||
| Net income / (loss) from continuing operations | ( | ) | ( | ) | ||||||||||||
| Net income / (loss) from discontinued operations, net of taxes | ( | ) | ( | ) | ||||||||||||
| Net income / (loss) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Basic: | ||||||||||||||||
| Earnings / (Loss) from continuing operations per share | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Earnings / (Loss) from discontinued operations per share | ( | ) | ( | ) | ||||||||||||
| Basic earnings / (loss) per share | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Diluted: | ||||||||||||||||
| Earnings / (Loss) from continuing operations per share | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Earnings / (Loss) from discontinued operations per share | ( | ) | ( | ) | ||||||||||||
| Diluted loss per share | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Weighted average shares outstanding: | ||||||||||||||||
| Basic | ||||||||||||||||
| Diluted | ||||||||||||||||
| Cash dividends declared per share | $ | $ | $ | $ | ||||||||||||
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
2
HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME / (LOSS)
(In thousands)
(Unaudited)
| For the | ||||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net income / (loss) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Other comprehensive income: | ||||||||||||||||
| Actuarial adjustments | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Income tax effect on adjustments | ||||||||||||||||
| Adjustments to net periodic benefit cost | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Total comprehensive income / (loss) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
3
HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| For the | ||||||||
| Twenty-Six Weeks Ended | ||||||||
| August 2, | August 3, | |||||||
| 2026 | 2025 | |||||||
| Operating Activities: | ||||||||
| Net income / (loss) | $ | $ | ( | ) | ||||
| Less: Income / (Loss) from discontinued operations, net of taxes | ( | ) | ||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | ||||||||
| Deferred income tax expense / (benefit) | ( | ) | ||||||
| Noncash restricted stock and performance awards | ||||||||
| Provision for / (benefit from) doubtful accounts and sales allowances | ( | ) | ||||||
| Gain on life insurance policies | ( | ) | ( | ) | ||||
| Loss on disposal of assets | ||||||||
| Changes in assets and liabilities: | ||||||||
| Trade accounts receivable | ||||||||
| Inventories | ||||||||
| Income tax recoverable | ||||||||
| Prepaid expenses and other assets | ( | ) | ( | ) | ||||
| Trade accounts payable | ( | ) | ||||||
| Accrued salaries, wages, and benefits | ||||||||
| Accrued income taxes | ( | ) | ( | ) | ||||
| Customer deposits | ||||||||
| Operating lease assets and liabilities | ||||||||
| Other accrued expenses | ||||||||
| Deferred compensation | ( | ) | ( | ) | ||||
| Net cash provided by operating activities | $ | $ | ||||||
| Investing Activities: | ||||||||
| Purchases of property and equipment | ( | ) | ( | ) | ||||
| Premiums paid on life insurance policies | ( | ) | ( | ) | ||||
| Proceeds received on life insurance policies | ||||||||
| Proceeds from sales of assets | ||||||||
| Net cash used in investing activities | $ | ( | ) | $ | ( | ) | ||
| Financing Activities: | ||||||||
| Proceeds from revolving credit facility | ||||||||
| Payments for long-term loans | ( | ) | ( | ) | ||||
| Cash dividends paid | ( | ) | ( | ) | ||||
| Purchase and retirement of common stock | ( | ) | ||||||
| Debt issuance costs | ( | ) | ||||||
| Net cash used in financing activities | $ | ( | ) | $ | ( | ) | ||
| Discontinued Operations | ||||||||
| Cash provided by / (used in) operating activities | ( | ) | ||||||
| Cash used in investing activities | ( | ) | ||||||
| Cash provided by / (used in) discontinued operations | $ | $ | ( | ) | ||||
| Net Increase / (decrease) in cash and cash equivalents | ( | ) | ||||||
| Cash and cash equivalents - beginning of year | ||||||||
| Cash and cash equivalents - end of quarter | $ | $ | ||||||
| Supplemental schedule of cash flow information: | ||||||||
| Income taxes paid / (refund), net | $ | $ | ( | ) | ||||
| Interest paid, net | ||||||||
| Supplemental schedule of noncash investing activities: | ||||||||
| Increase in lease liabilities arising from obtaining right-of-use assets | $ | $ | ||||||
| Increase in property and equipment through accrued purchases | ||||||||
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
4
HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(In thousands, except per share data)
(Unaudited)
| Accumulated | ||||||||||||||||||||
| Other | Total | |||||||||||||||||||
| Common Stock | Retained | Comprehensive | Shareholders’ | |||||||||||||||||
| Shares | Amount | Earnings | Income | Equity | ||||||||||||||||
| Balance at May 4, 2025 | $ | $ | $ | $ | ||||||||||||||||
| Net loss for the 13 weeks ended August 3, 2025 | ( | ) | ( | ) | ||||||||||||||||
| Actuarial adjustments on defined benefit plan, net of tax of $ | ( | ) | ( | ) | ||||||||||||||||
| Cash dividends paid and accrued ($ | ( | ) | ( | ) | ||||||||||||||||
| Restricted stock grants, net of forfeitures | - | - | ||||||||||||||||||
| Restricted stock compensation cost | ||||||||||||||||||||
| Performance-based restricted stock units cost | ( | ) | ( | ) | ||||||||||||||||
| Balance at August 3, 2025 | $ | $ | $ | $ | ||||||||||||||||
| Balance at May 3, 2026 | $ | $ | $ | $ | ||||||||||||||||
| Net income for the 13 weeks ended August 2, 2026 | ||||||||||||||||||||
| Actuarial adjustments on defined benefit plan, net of tax of $ | ( | ) | ( | ) | ||||||||||||||||
| Cash dividends paid and accrued ($ | ( | ) | ( | ) | ||||||||||||||||
| Purchase and retirement of common stock | ( | ) | $ | ( | ) | ( | ) | ( | ) | |||||||||||
| Restricted stock grants, net of forfeitures | ( | ) | ( | ) | ||||||||||||||||
| Restricted stock compensation cost | ||||||||||||||||||||
| Performance-based restricted stock units cost | ( | ) | ( | ) | ||||||||||||||||
| Balance at August 2, 2026 | $ | $ | $ | $ | ||||||||||||||||
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
5
HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (CONT.)
(In thousands, except per share data)
(Unaudited)
| Accumulated | ||||||||||||||||||||
| Other | Total | |||||||||||||||||||
| Common Stock | Retained | Comprehensive | Shareholders’ | |||||||||||||||||
| Shares | Amount | Earnings | Income | Equity | ||||||||||||||||
| Balance at February 2, 2025 | $ | $ | $ | $ | ||||||||||||||||
| Net loss for the 26 weeks ended August 3, 2025 | ( | ) | ( | ) | ||||||||||||||||
| Actuarial adjustments on defined benefit plan, net of tax of $ | ( | ) | ( | ) | ||||||||||||||||
| Cash dividends paid and accrued ($ | ( | ) | ( | ) | ||||||||||||||||
| Restricted stock grants, net of forfeitures | ( | ) | ( | ) | ||||||||||||||||
| Restricted stock compensation cost | ||||||||||||||||||||
| Performance-based restricted stock units cost | ( | ) | ( | ) | ||||||||||||||||
| Balance at August 3, 2025 | $ | $ | $ | $ | ||||||||||||||||
| Balance at February 1, 2026 | $ | $ | $ | $ | ||||||||||||||||
| Net income for the 26 weeks ended August 2, 2026 | ||||||||||||||||||||
| Actuarial adjustments on defined benefit plan, net of tax of $ | ( | ) | ( | ) | ||||||||||||||||
| Cash dividends paid and accrued ($ | ( | ) | ( | ) | ||||||||||||||||
| Purchase and retirement of common stock | ( | ) | $ | ( | ) | ( | ) | ( | ) | |||||||||||
| Restricted stock grants, net of forfeitures | ( | ) | ( | ) | ||||||||||||||||
| Restricted stock compensation cost | ||||||||||||||||||||
| Performance-based restricted stock units cost | ||||||||||||||||||||
| Balance at August 2, 2026 | $ | $ | $ | $ | ||||||||||||||||
6
HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollar and share amounts in tables, except per share amounts, in thousands unless otherwise indicated)
(Unaudited)
For the Twenty-Six Weeks Ended August 2, 2026
| 1. | Preparation of Interim Financial Statements |
The condensed consolidated financial statements of Hooker Furnishings Corporation and subsidiaries (referred to as “we,” “us,” “our,” “Hooker” or the “Company”) have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”). In the opinion of management these statements include all adjustments necessary for a fair statement of the results of all interim periods reported herein. All such adjustments are of a normal recurring nature. Certain information and footnote disclosures prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) are condensed or omitted pursuant to SEC rules and regulations. However, we believe that the disclosures made are adequate for a fair presentation of our results of operations and financial position. These financial statements should be read in conjunction with the audited consolidated financial statements and accompanying notes included in our annual report on Form 10-K for the fiscal year ended February 1, 2026 (“2026 Annual Report”). The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect both the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from our estimates. Operating results for the interim periods reported herein may not be indicative of the results expected for the fiscal year.
The financial statements contained herein are being filed as part of a quarterly report on Form 10-Q covering the 2027 fiscal year thirteen-week period (also referred to as “three months,” “three-month period,” “quarter,” “second quarter” or “quarterly period”) that began May 4, 2026, and the twenty-six week period (also referred to as “six months,” “six-month period” or “first half”) that began February 2, 2026, which both ended August 2, 2026. This report discusses our results of operations for these periods compared to the 2026 fiscal year thirteen-week period that began May 5, 2025 and the twenty-six week period that began February 3, 2025, which both ended August 3, 2025; and our financial condition as of August 2, 2026 compared to February 1, 2026.
References in these notes to the condensed consolidated financial statements of the Company to:
| ◾ | the 2027 fiscal year and comparable terminology mean the fifty-two-week fiscal year that began February 2, 2026 and will end January 31, 2027; and |
| ◾ | the 2026 fiscal year and comparable terminology mean the fifty-two-week fiscal year that began February 3, 2025 and ended February 1, 2026. |
| 2. |
In November 2024, the FASB issued ASU 2024-03, “Disaggregation of income statement expenses”. The new guidance requires new tabular disclosures to disaggregate prescribed natural expenses underlying any income statement caption. ASU 2024-03 is effective for annual periods beginning after December 15, 2026 (our fiscal 2028). We are currently evaluating the impact that the adoption of this new guidance will have on our consolidated financial statements and will add necessary disclosures upon adoption.
We reviewed all other newly issued accounting pronouncements and concluded that they are either not applicable to our business or are not expected to have a material effect on our consolidated financial statements as a result of future adoption.
| 3. | Discontinued Operations |
During the third quarter of fiscal 2026, we determined that the Home Meridian segment no longer aligned with our long-term strategy to streamline our portfolio and enhance profitability by focusing on brands that generate consistent earnings. As a result, we initiated a process to sell two brands in the segment. On December 1, 2025, we entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with a buyer to sell the Company’s Pulaski Furniture (“PFC”) and Samuel Lawrence (“SLF”) casegoods brands, including specified assets and liabilities associated with those brands. We retain the Samuel Lawrence brand in connection with the operation of its hospitality business.
7
On
December 12, 2025, the Company completed the sale and received cash proceeds of approximately $
Following the sale, the Home Meridian segment was eliminated, with its remaining Samuel Lawrence Hospitality brand reclassified into the “All Other” category.
We believe this transaction represented a single disposal plan that constituted a strategic shift that materially affects our operations and financial results. Accordingly, the financial results of the PFC and SLF businesses are reflected in our consolidated financial statements as discontinued operations for all periods presented.
Although the divestiture was completed in the
prior fiscal year, current-period activity in discontinued operations primarily reflected tariff recoveries the Company received during
the second quarter of fiscal 2027 associated with the divested business. Approximately $
Current-period activity also included approximately
$
The following table represents summarized statements of operations information of carrying amounts of major classes of line items constituting pretax income or loss of discontinued operations included as part of discontinued operations:
| For the | For the | |||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net sales | $ | ( | ) | $ | $ | ( | ) | $ | ||||||||
| Cost of sales | ( | ) | ( | ) | ||||||||||||
| Gross profit / (loss) | ( | ) | ||||||||||||||
| Selling and administrative expenses | ||||||||||||||||
| Intangible asset amortization | ||||||||||||||||
| Other income items that are not major | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Pretax income / (loss) of discontinued operations related to major classes | ( | ) | ( | ) | ||||||||||||
| Loss on sale of the discontinued operations | ||||||||||||||||
| Income / (Loss) from discontinued operations before income taxes | ( | ) | ( | ) | ||||||||||||
| Income tax expense / (benefit) | ( | ) | ( | ) | ||||||||||||
| Net income / (loss) from discontinued operations | ( | ) | ( | ) | ||||||||||||
8
The significant components included in our condensed consolidated statements of cash flows for the discontinued operations are as follows:
| For the | ||||||||
| Twenty-Six Weeks Ended | ||||||||
| August 2, | August 3, | |||||||
| 2026 | 2025 | |||||||
| Operating Activities: | ||||||||
| Income / (Loss) from discontinued operations, net of tax | $ | $ | ( | ) | ||||
| Depreciation and amortization | ||||||||
| Changes in assets and liabilities: | ||||||||
| Trade accounts receivable, net | ||||||||
| Inventories | ||||||||
| Trade accounts payable | ( | ) | ||||||
| Other assets and liabilities | ||||||||
| Cash provided by / (used in) operating activities from discontinued operations | $ | $ | ( | ) | ||||
| Investing Activities: | ||||||||
| Purchase of properties and equipment | ( | ) | ||||||
| Cash used in investing activities from discontinued operations | $ | $ | ( | ) | ||||
| 4. | Accounts Receivable |
| August 2, | February 1, | |||||||
| 2026 | 2026 | |||||||
| Gross accounts receivable | $ | $ | ||||||
| Customer allowances | ( | ) | ( | ) | ||||
| Allowance for doubtful accounts | ( | ) | ( | ) | ||||
| Trade accounts receivable | $ | $ | ||||||
| 5. | Inventories |
| August 2, | February 1, | |||||||
| 2026 | 2026 | |||||||
| Finished furniture | $ | $ | ||||||
| Furniture in process | ||||||||
| Materials and supplies | ||||||||
| Inventories at FIFO | ||||||||
| Reduction to LIFO basis | ( | ) | ( | ) | ||||
| Inventories | $ | $ | ||||||
9
| 6. | Property, Plant and Equipment |
| Depreciable Lives | August 2, | February 1, | ||||||||||
| (In years) | 2026 | 2026 | ||||||||||
| Buildings and land improvements | $ | $ | ||||||||||
| Machinery and equipment | ||||||||||||
| Computer software and hardware | ||||||||||||
| Leasehold improvements | ||||||||||||
| Furniture and fixtures | ||||||||||||
| Other | ||||||||||||
| Total depreciable property at cost | ||||||||||||
| Less accumulated depreciation | ( | ) | ( | ) | ||||||||
| Total depreciable property, net | ||||||||||||
| Land | ||||||||||||
| Construction-in-progress | ||||||||||||
| Property, plant and equipment, net | $ | $ | ||||||||||
| 7. | Internal-Use Software |
Our
internal-use software includes our Enterprise Resource Planning (“ERP”) system across all divisions, as well as our new website
and integrated B2B online marketplace, which was placed into service at the beginning of fiscal 2027. The gross carrying amount of capitalized
implementation costs related to our cloud computing hosting arrangements increased by $
| August 2, 2026 | February 1, 2026 | |||||||||||||||
| Gross carrying amount | Accumulated amortization | Gross carrying amount | Accumulated amortization | |||||||||||||
| Implementation Costs | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Interest Expenses | ( | ) | ( | ) | ||||||||||||
| 8. | Fair Value Measurements |
Fair value is the price that would be received upon the sale of an asset or paid upon the transfer of a liability (an exit price) in an orderly transaction between market participants on the applicable measurement date. We use a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include:
| ◾ | Level 1, defined as observable inputs such as quoted prices in active markets for identical assets and liabilities; |
| ◾ | Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and |
| ◾ | Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. |
10
As of August 2, 2026 and February 1, 2026, Company-owned life insurance was measured at fair value on a recurring basis based on Level 2 inputs. The fair value of the Company-owned life insurance is determined by inputs that are readily available in public markets or can be derived from information available in publicly quoted markets. Additionally, the fair value of the Company-owned life insurance is marked to market each reporting period and any change in fair value is reflected in income for that period.
Our assets measured at fair value on a recurring basis at August 2, 2026 and February 1, 2026, were as follows:
| Fair value at August 2, 2026 | Fair value at February 1, 2026 | |||||||||||||||||||||||||||||||
| Description | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||||
| (In thousands) | ||||||||||||||||||||||||||||||||
| Assets measured at fair value | ||||||||||||||||||||||||||||||||
| Company-owned life insurance | $ | $ | $ | $ | $ | $ | $ | $ | ||||||||||||||||||||||||
| 9. | Intangible Assets |
Our
intangible assets with indefinite lives consist of: goodwill related to the Shenandoah and BOBO Intriguing Objects acquisitions; and
trademarks and tradenames related to the acquisitions of Bradington-Young, Home Meridian and BOBO Intriguing Objects. Our intangible
assets with definite lives are recorded in the Domestic Upholstery segment, consisting of Shenandoah and Sunset West trade names and
customer relations.
| August 2, 2026 | February 1, 2026 | |||||||||||||||
| Gross carrying amount | Impairment / Accumulated Amortization | Gross carrying amount | Impairment / Accumulated Amortization | |||||||||||||
| Intangible assets with indefinite lives: | ||||||||||||||||
| Goodwill | ||||||||||||||||
| Domestic Upholstery - Shenandoah * | ||||||||||||||||
| All Other - BOBO Intriguing Objects | ||||||||||||||||
| Goodwill | ||||||||||||||||
| Trademarks and Trade names * | ( | ) | ( | ) | ||||||||||||
| Intangible assets with definite lives: | ||||||||||||||||
| Customer Relationships | ( | ) | ( | ) | ||||||||||||
| Trademarks and Trade names | ( | ) | ( | ) | ||||||||||||
| Intangible assets, net | ( | ) | ( | ) | ||||||||||||
| *: | The amounts are net of impairment charges of $ |
Amortization
expenses for intangible assets with definite lives were $
| 10. | Leases |
We
have operating leases for warehouses, showrooms, manufacturing facilities, offices and equipment. Sub-lease income totaled $
11
The components of lease cost and supplemental cash flow information for leases for the second quarters and six-months of fiscal 2027 and 2026 were:
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||
| August 2, 2026 | August 3, 2025 | August 2, 2026 | August 3, 2025 | |||||||||||||
| Operating lease cost | $ | $ | $ | $ | ||||||||||||
| Variable lease cost | ||||||||||||||||
| Short-term lease cost | ||||||||||||||||
| Total operating lease cost | $ | $ | $ | $ | ||||||||||||
| Operating cash outflows | $ | $ | $ | $ | ||||||||||||
The right-of-use assets and lease liabilities recorded on our condensed consolidated balance sheets as of August 2, 2026 and February 1, 2026 were as follows:
| August 2, 2026 | February 1, 2026 | |||||||
| Real estate | $ | $ | ||||||
| Property and equipment | ||||||||
| Total operating leases right-of-use assets | $ | $ | ||||||
| Current portion of operating lease liabilities | $ | $ | ||||||
| Long term operating lease liabilities | ||||||||
| Total operating lease liabilities | $ | $ | ||||||
The
weighted-average discount rate is
The following table reconciles the undiscounted future lease payments for operating leases to the operating lease liabilities recorded in the condensed consolidated balance sheets on August 2, 2026:
| Undiscounted Future Operating Lease Payments | ||||
| Remainder of fiscal 2027 | $ | |||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| 2031 | ||||
| 2032 and thereafter | ||||
| Total lease payments | $ | |||
| Less: impact of discounting | ( | ) | ||
| Present value of lease payments | $ | |||
| 11. | Long-Term Debt |
On December 5, 2024, the Company and its wholly owned subsidiaries, Bradington-Young, LLC, Sam Moore Furniture LLC and Home Meridian Group, LLC (together with the Company, the “Borrowers”), entered into an Amended and Restated Loan and Security Agreement (the “Amended and Restated Loan Agreement”) with Bank of America, N.A. (“BofA”), as lender. The Amended and Restated Loan Agreement amends, restates and replaces the Second Amended and Restated Loan Agreement, dated as of September 29, 2017, between the Borrowers and BofA, as amended (the “Existing Loan Agreement”). The outstanding principal amount of loans and letters of credit issued under the Existing Loan Agreement and used to collateralize certain insurance arrangements and for imported product purchases will remain outstanding as loans and letters of credit under the Amended and Restated Loan Agreement.
12
The
Amended and Restated Loan Agreement provides for a revolving credit facility in a committed principal amount of up to $
Availability of loans and letters of credit under the Revolving Commitment is capped by a borrowing base formula calculated as of any date as the sum for the Borrowers of (a) the value of their accounts receivable, (b) the value of their inventory, (c) the value of their in-transit inventory and (d) the life insurance cash surrender value of Company-owned life insurance policies, in each case subject to eligibility requirements, advance rates, valuation metrics, reductions for write-offs and other dilutive items and reserves (the “Borrowing Base”). The lesser of the Revolving Commitment and the Borrowing Base, in each case net of the principal amount of outstanding loans and the face amount of letters of credit, constitutes “Availability” under the Amended and Restated Credit Agreement.
Outstanding
loans under the Amended and Restated Loan Agreement will bear interest at a rate per annum equal to the then-current
We may prepay any outstanding principal amounts borrowed under the Amended and Restated Loan Agreement at any time, without penalty provided that any payment is accompanied by all accrued interest owed. Subject to the Borrowers having sufficient borrowing base capacity and customary conditions precedent to borrowing, amounts repaid may be reborrowed. The Revolving Commitment will terminate, and all amounts outstanding thereunder will be due and payable, on December 5, 2029.
The obligations under the Amended and Restated Loan Agreement are secured by a first priority security interest in substantially all of the assets of the Borrowers, other than real estate, including all Company-owned life insurance policies, all accounts receivable, all inventory, all intellectual property, all equipment and all other personal property.
The
Amended and Restated Loan Agreement includes customary representations and warranties and requires the Borrowers to comply with customary
affirmative and negative covenants, including, among other things, a financial covenant requiring the maintenance of a ratio of (x) EBITDA
net of capital expenditures (to the extent not paid using Borrowed Money) to (y) the sum of debt service and dividends paid, in each
case as of the last day of each month for the trailing twelve-month period ending on such day, of at least 1.0 to 1.0, if an event of
default has occurred and is continuing or Availability has fallen below 10% of the Revolving Commitment at any time (until such time
as both Availability is 10% or greater and no event of default exists, for the
The Amended and Restated Loan Agreement also limits the Borrowers’ right to incur other indebtedness, make certain investments and create liens upon our assets, subject to certain exceptions, among other restrictions. The Amended and Restated Loan Agreement does not restrict the Company’s ability to pay cash dividends on, or repurchase, shares of its common stock, subject to (a) no default existing prior to or resulting from such dividend or repurchase, (b) Availability is not less than 15% of the Revolving Commitment for each of the preceding 45 days prior to announcement of such dividend or repurchase and after giving pro forma effect to such dividend or repurchase and (c) if Availability is less than 20% of the Revolving Commitment on any day in such 45-day period, the Borrowers are in compliance with the financial covenant described above after giving effect to such dividend or repurchase.
We
incurred $
As
of August 2, 2026, there were
13
| 12. | Earnings Per Share |
We refer you to the discussion of Earnings Per Share in Note 1. Summary of Significant Accounting Policies, in the financial statements included in our 2026 Annual Report, for additional information concerning the calculation of earnings per share (EPS).
All stock awards are designed to encourage retention and to provide an incentive for increasing shareholder value. We have issued restricted stock awards to non-employee members of the board of directors since 2006 and to certain non-executive employees since 2014. We have issued RSUs to certain senior executives since fiscal 2012 under the Company’s Stock Incentive Plan. Each RSU entitles an executive to receive one share of the Company’s common stock and vests in three equal annual installments, with one-third vesting at the end of each service period, if the executive remains continuously employed with the Company through the end of a three-year service period. The RSUs may be paid in shares of our common stock, cash or both at the discretion of the Compensation Committee of our board of directors. We have issued PSUs to certain senior executives since fiscal 2019 under the Company’s Stock Incentive Plan. Each PSU entitles the executive officer to receive one share of our common stock based on the achievement of one of two specified performance conditions if the executive officer remains continuously employed through the end of the three-year performance period, one performance condition is the Company’s annual EPS growth over the performance period and the other performance condition is the Company’s total shareholder return during the performance period compared to the Company’s peer group. The payout or settlement of the PSUs will be made in shares of our common stock.
We expect to continue to grant these types of awards annually in the future. The following table sets forth the number of outstanding restricted stock awards and RSUs and PSUs, net of forfeitures and vested shares, as of the fiscal period-end dates indicated:
| August 2, | February 1, | |||||||
| 2026 | 2026 | |||||||
| Restricted shares | ||||||||
| RSUs and PSUs | ||||||||
All restricted shares, RSUs and PSUs awarded that have not yet vested are considered when computing diluted earnings per share.
During
the fiscal 2027 first half, we purchased and retired
14
The following table sets forth the computation of basic and diluted earnings per share:
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net income / (loss) from continuing operations | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Less: Unvested participating restricted stock dividends | ||||||||||||||||
| Net earnings allocated to unvested participating restricted stock | ||||||||||||||||
| Earnings / (loss) from continuing operations available for common shareholders | ( | ) | ( | ) | ||||||||||||
| Earnings / (loss) from discontinued operations available for common shareholders | ( | ) | ( | ) | ||||||||||||
| Net earnings / (loss) available for common shareholders | ( | ) | ( | ) | ||||||||||||
| Weighted average shares outstanding for basic earnings per share | ||||||||||||||||
| Dilutive effect of unvested restricted stock, RSU and PSU awards | ||||||||||||||||
| Weighted average shares outstanding for diluted earnings per share | ||||||||||||||||
| Basic earnings / (loss) from continuing operations per share | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Basic earnings / (loss) from discontinued operations per share | ( | ) | ( | ) | ||||||||||||
| Basic earnings / (loss) per share | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Diluted earnings / (loss) from continuing operations per share | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
| Diluted earnings / (loss) from discontinued operations per share | ( | ) | ( | ) | ||||||||||||
| Diluted earnings / (loss) per share | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
Due
to net losses, approximately
| 13. | Income Taxes |
In the fiscal 2027 second quarter, we recorded
income tax expenses of $
In
the fiscal 2027 first half, we recorded income tax expenses of $
No material and non-routine positions have been identified as uncertain tax positions.
Tax years ending January 29, 2023 through February 1, 2026 remain subject to examination by federal and state taxing authorities.
15
| 14. | Segment Information |
As a public entity, we are required to present disaggregated information by segment using the management approach. The objective of this approach is to allow users of our financial statements to see our business through the eyes of management based upon the way management reviews performance and makes decisions. The management approach requires segment information to be reported based on how management internally evaluates the operating performance of the Company’s business units or segments. The objective of this approach is to meet the basic principles of segment reporting as outlined in ASC 280 Segments (“ASC 280”), which are to allow the users of our financial statements to:
| ● | better understand our performance; |
| ● | better assess our prospects for future net cash flows; and |
| ● | make more informed judgments about us as a whole. |
We define our segments as those operations our chief operating decision maker (“CODM”) regularly reviews to analyze performance and allocate resources. The Company’s CODM is the Chief Executive Officer. The CODM regularly reviews net sales, gross profit, and operating income by segment as the primary measures of segment performance. The CODM reviews net sales as a primary indicator of operational performance, assessing how much revenue is brought in from core business activities, after returns, allowances, and discounts, which reflects demand and execution of each segment’s strategy. Gross profit, which is derived from net sales and cost of sales, is reviewed by the CODM as a diagnostic metric, particularly useful in evaluating margin trends. Operating income is the key profitability metric used to assess performance across segments and make decisions related to resource allocation, including capital expenditures, headcount, and other investment initiatives. Each of these metrics are considered in budgeting, forecasting, and operational planning decisions.
For
financial reporting purposes, we are organized into
| ● | Hooker Branded, consisting of the operations of our imported Hooker Casegoods and Hooker Upholstery businesses; |
| ● | Domestic Upholstery, which includes the domestic upholstery manufacturing operations of Bradington-Young, HF Custom (formerly Sam Moore), Shenandoah Furniture and Sunset West; and |
| ● | All Other, consisting of Samuel Lawrence Hospitality, intercompany eliminations and operating segments that are not individually reportable. |
16
The following tables present segment information for the periods, and as of the dates, indicated.
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||||||||||||||||||
| August 2, 2026 | August 3, 2025 | August 2, 2026 | August 3, 2025 | |||||||||||||||||||||||||||||
| % Net | % Net | % Net | % Net | |||||||||||||||||||||||||||||
| Net Sales | Sales | Sales | Sales | Sales | ||||||||||||||||||||||||||||
| Hooker Branded | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Domestic Upholstery | % | % | % | % | ||||||||||||||||||||||||||||
| All Other | % | % | % | % | ||||||||||||||||||||||||||||
| Consolidated | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Cost of Sales | ||||||||||||||||||||||||||||||||
| Hooker Branded | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Domestic Upholstery | % | % | % | % | ||||||||||||||||||||||||||||
| All Other | % | % | % | % | ||||||||||||||||||||||||||||
| Consolidated | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Gross Profit | ||||||||||||||||||||||||||||||||
| Hooker Branded | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Domestic Upholstery | % | % | % | % | ||||||||||||||||||||||||||||
| All Other | % | % | % | % | ||||||||||||||||||||||||||||
| Consolidated | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Selling and Administrative Expenses | ||||||||||||||||||||||||||||||||
| Hooker Branded | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Domestic Upholstery | % | % | % | % | ||||||||||||||||||||||||||||
| All Other | % | % | % | % | ||||||||||||||||||||||||||||
| Consolidated | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Intangible Asset Amortization | ||||||||||||||||||||||||||||||||
| Domestic Upholstery | % | $ | % | % | $ | % | ||||||||||||||||||||||||||
| All Other | % | % | - | % | % | |||||||||||||||||||||||||||
| Consolidated | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Operating Income / (Loss) | ||||||||||||||||||||||||||||||||
| Hooker Branded | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Domestic Upholstery | % | ( | ) | - | % | % | ( | ) | - | % | ||||||||||||||||||||||
| All Other | ( | ) | - | % | ( | ) | - | % | % | ( | ) | - | % | |||||||||||||||||||
| Consolidated | $ | % | $ | ( | ) | - | % | $ | % | $ | ( | ) | - | % | ||||||||||||||||||
| Other Income, net | ||||||||||||||||||||||||||||||||
| Hooker Branded | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Domestic Upholstery | % | % | % | % | ||||||||||||||||||||||||||||
| All Other | % | % | % | % | ||||||||||||||||||||||||||||
| Consolidated | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Interest expense - Corporate | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Income taxes - Corporate | $ | % | $ | ( | ) | - | % | $ | % | $ | ( | ) | - | % | ||||||||||||||||||
| Net income / (loss) from continuing operations - Corporate | $ | % | $ | ( | ) | - | % | $ | % | $ | ( | ) | - | % | ||||||||||||||||||
During
the second quarter of fiscal 2027, the Company received $
The following table presents the tariff recoveries recorded by segment during the second quarter of fiscal 2027.
17
| TARIFF RECOVERIES BY SEGMENT | ||||||||||||||||
| 13 Weeks Ended | 26 Weeks Ended | |||||||||||||||
| August 2, 2026 | August 2, 2026 | |||||||||||||||
| % Net | % Net | |||||||||||||||
| Net sales | Sales | Sales | ||||||||||||||
| Hooker Branded | $ | ( | ) | - | % | $ | ( | ) | - | % | ||||||
| Domestic Upholstery | % | % | ||||||||||||||
| All Other | ( | ) | - | % | ( | ) | - | % | ||||||||
| Consolidated | $ | ( | ) | - | % | $ | ( | ) | - | % | ||||||
| Cost of sales | ||||||||||||||||
| Hooker Branded | $ | ( | ) | - | % | $ | ( | ) | - | % | ||||||
| Domestic Upholstery | ( | ) | - | % | ( | ) | - | % | ||||||||
| All Other | ( | ) | - | % | ( | ) | - | % | ||||||||
| Consolidated | $ | ( | ) | - | % | $ | ( | ) | - | % | ||||||
| Interest Income | ||||||||||||||||
| Hooker Branded | $ | % | $ | % | ||||||||||||
| Domestic Upholstery | % | % | ||||||||||||||
| All Other | % | % | ||||||||||||||
| Consolidated | $ | % | $ | % | ||||||||||||
| Discontinued Operations | ||||||||||||||||
| Net sales | $ | ( | ) | $ | ( | ) | ||||||||||
| Cost of sales | ( | ) | ( | ) | ||||||||||||
| Interest Income | ||||||||||||||||
| As of | ||||
| August 2, 2026 | ||||
| Inventories | ||||
| Hooker Branded | $ | ( | ) | |
| Domestic Upholstery | ( | ) | ||
| All Other | ||||
| Consolidated | $ | ( | ) | |
| Discontinued Operations | $ | - | ||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||
| August 2, 2026 | August 3, 2025 | August 2, 2026 | August 3, 2025 | |||||||||||||
| Restructuring Costs | ||||||||||||||||
| Hooker Branded | $ | $ | $ | $ | ||||||||||||
| Domestic Upholstery | ||||||||||||||||
| All Other | ||||||||||||||||
| Consolidated | $ | $ | $ | $ | ||||||||||||
| Capital Expenditures | ||||||||||||||||
| Hooker Branded | $ | $ | $ | $ | ||||||||||||
| Domestic Upholstery | ||||||||||||||||
| All Other | ||||||||||||||||
| Consolidated | $ | $ | $ | $ | ||||||||||||
| Depreciation & Amortization | ||||||||||||||||
| Hooker Branded | $ | $ | $ | $ | ||||||||||||
| Domestic Upholstery | ||||||||||||||||
| All Other | ||||||||||||||||
| Consolidated | $ | $ | $ | $ | ||||||||||||
Restructuring
costs, primarily related to severance, were $
18
| As of August 2, | As of February 1, | |||||||||||||||
| 2026 | %Total | 2026 | %Total | |||||||||||||
| Assets | Assets | Assets | ||||||||||||||
| Hooker Branded | $ | % | $ | % | ||||||||||||
| Domestic Upholstery | % | % | ||||||||||||||
| All Other | % | % | ||||||||||||||
| Consolidated Assets | $ | % | $ | % | ||||||||||||
| Consolidated Goodwill and Intangibles | ||||||||||||||||
| Total Consolidated Assets | $ | $ | ||||||||||||||
Sales by product type are as follows:
| Net Sales (in thousands) | ||||||||||||||||||||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||||||||||||||||||
| August 2, 2026 | %Total | August 3, 2025 | %Total | August 2, 2026 | %Total | August 3, 2025 | %Total | |||||||||||||||||||||||||
| Casegoods | $ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||||||
| Upholstery | % | % | % | % | ||||||||||||||||||||||||||||
| $ | % | $ | % | $ | % | $ | % | |||||||||||||||||||||||||
15. Subsequent Events
Dividends
On
19
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
All references to the “Company,” “we,” “us” and “our” in this document refer to Hooker Furnishings Corporation and its consolidated subsidiaries, unless specifically referring to segment information. The Hooker Branded segment includes Hooker Casegoods and Hooker Upholstery. The Domestic Upholstery segment includes Bradington-Young, HF Custom (formerly Sam Moore), Shenandoah Furniture and Sunset West. “All Other” includes Samuel Lawrence Hospitality, intercompany eliminations and operating segments that are not individually reportable.
Forward-Looking Statements
Certain statements made in this report, including statements under Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in the notes to the condensed consolidated financial statements included in this report, are not based on historical facts, but are forward-looking statements. These statements reflect our reasonable judgment with respect to future events and typically can be identified by the use of forward-looking terminology such as “believes,” “expects,” “projects,” “intends,” “plans,” “may,” “will,” “should,” “would,” “could,” or “anticipates,” or the negatives thereof, or other variations thereof, or comparable terminology, or by discussions of strategy. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Those risks and uncertainties include but are not limited to:
(1) adverse political acts or developments affecting the international markets from which we import products and certain components used in our Domestic Upholstery segment, including the imposition of duties or tariffs by the U.S. or foreign governments, such as the tariffs under Section 301, antidumping and countervailing duty orders on raw materials like timber and lumber, the potential for additional or higher reciprocal tariffs on imports from key sourcing countries, uncertainty regarding tariff refunds, and other trade restrictions, could affect our supply chain and increase our costs, and adversely affect our sales, earnings, and liquidity;
(2) general economic or business conditions, both domestically and internationally, including the current macroeconomic uncertainties and challenges to the retail environment for home furnishings along with instability in the financial and credit markets, in part due to elevated interest rates and housing market volatility, which can affect consumer discretionary spending, existing home sales, and demand for home furnishings, including their potential impact on (i) our sales, operating costs and access to financing, (ii) our customers, and (iii) our suppliers and their ability to obtain financing or generate the cash necessary to conduct their respective businesses;
(3) the impairment of our long-lived assets, which can result in reduced earnings and net worth;
(4) the cyclical nature of the furniture industry, which is particularly sensitive to changes in consumer confidence, the amount of consumers’ income available for discretionary purchases, and the availability and terms of consumer credit;
(5) achieving and managing growth and change, and the risks associated with new business lines including the Margaritaville launch, acquisitions, the selection of suitable acquisition targets, restructurings, strategic alliances and international operations;
(6) risks associated with the ultimate outcome of our cost reduction efforts, including the amounts and timing of savings realized and the ability to scale the business appropriately as customer demand increases or decreases based on the macroeconomic environment;
(7) risks associated with our reliance on offshore sourcing and the cost of imported goods, including fluctuation in the prices of purchased finished goods, customs issues, tariffs, freight and fuel costs, including the price and availability of shipping containers, ocean vessels, domestic trucking, and warehousing costs and the risk that a disruption in our supply chain or the transportation and handling industries, including labor stoppages, strikes, slowdowns, or geopolitical conflicts or instability affecting key global shipping routes and our suppliers, could adversely affect our ability to timely fulfill customer orders;
(8) interruption, inadequacy, security breaches or integration failure of our information systems or information technology infrastructure, related service providers or the internet or other related issues including unauthorized disclosures of confidential information, hacking or other cybersecurity threats or inadequate levels of cyber insurance or risks not covered by cyber insurance;
(9) difficulties in forecasting demand for our imported products and raw materials used in our domestic operations;
(10) our inability to collect amounts owed to us or significant delays in collecting such amounts;
(11) risks associated with domestic manufacturing operations, including fluctuations in capacity utilization and the prices and availability of key raw materials, as well as changes in transportation, warehousing and domestic labor costs, availability of skilled labor, and environmental compliance and remediation costs;
(12) disruptions and damage (including those due to weather) affecting our Virginia or North Carolina warehouses, our Virginia, North Carolina or California administrative and manufacturing facilities, our High Point, Las Vegas, and Atlanta showrooms or our representative office or warehouse in Vietnam;
(13) changes in U.S. and foreign government regulations and in the political, social and economic climates of the countries from which we source our products;
20
(14) risks associated with product defects, including higher than expected costs associated with product quality and safety, regulatory compliance costs related to the sale of consumer products and costs related to defective or non-compliant products, product liability claims and costs to recall defective products and the adverse effects of negative media coverage;
(15) the direct and indirect costs and time spent by our associates related to the implementation of our Enterprise Resource Planning system (“ERP”), including costs resulting from unanticipated disruptions to our business;
(16) risks associated with our self-insured healthcare and workers compensation plans, which utilize stop-loss insurance for aggregate claims above specified thresholds and can be impacted by higher healthcare inflation and expenditures, all of which may cause our healthcare and workers compensation costs to rise unexpectedly, adversely affecting our earnings, financial condition, and liquidity;
(17) the risks associated with our Amended and Restated Loan Agreement, including the fact that our asset-based lending facility is secured by substantially all of our assets and contains provisions which limit the amount of our future borrowings under the facility, as well as financial and negative covenants that, among other things, may limit our ability to incur additional indebtedness;
(18) risks associated with distribution through third-party retailers, such as non-binding dealership arrangements;
(19) changes in domestic and international monetary policies and fluctuations in foreign currency exchange rates affecting the price of our imported products and raw materials;
(20) price competition in the furniture industry;
(21) changes in consumer preferences, including increased demand for lower-priced furniture, especially in light of recently imposed tariffs on imported furniture;
(22) the risks specifically related to the concentrations of a material part of our sales and accounts receivable in only a few customers, including the loss of several large customers through business consolidations, failures or other reasons, or the loss of significant sales programs with major customers;
(23) decisions concerning the allocation of capital including the extent to which we repurchase shares of our common stock which will affect shares outstanding and earnings per share (EPS); and
(24) future actions by activist stockholders that could divert management attention, create uncertainty around our strategic direction, disrupt relationships with key shareholders, increase our costs, drive stock price volatility, and otherwise materially impact our business, financial condition, results of operations, and cash flows.
Our forward-looking statements could be wrong in light of these and other risks, uncertainties and assumptions. The future events, developments or results described in this report could turn out to be materially different. Any forward-looking statement we make speaks only as of the date of that statement, and we undertake no obligation, except as required by law, to update any forward-looking statements whether as a result of new information, future events or otherwise and you should not expect us to do so.
Also, our business is subject to significant risks and uncertainties, any of which can adversely affect our business, results of operations, financial condition or future prospects. For a discussion of risks and uncertainties that we face, see the Forward-Looking Statements detailed above and Item 1A, “Risk Factors” in our 2026 Annual Report.
Investors should also be aware that while we occasionally communicate with securities analysts and others, it is against our policy to selectively disclose to them any material nonpublic information or other confidential commercial information. Accordingly, investors should not assume that we agree with any projection, forecast or report issued by any analyst regardless of the content of the statement or report, as we have a policy against confirming information issued by others.
21
Quarterly Reporting
This quarterly report on Form 10-Q includes our unaudited condensed consolidated financial statements for the 2027 fiscal year thirteen-week period (also referred to as “three months,” “three-month period,” “quarter,” “second quarter” or “quarterly period”) that began May 4, 2026 and the twenty-six-week period (also referred to as “six months”, “six-month period”, or “first half”) that began February 2, 2026, which both ended August 2, 2026. This report discusses our results of operations for these periods compared to the 2026 fiscal year thirteen-week period that began May 5, 2025, and the twenty-six-week period that began February 3, 2025, which both ended August 3, 2025; and our financial condition as of August 2, 2026 compared to February 1, 2026.
References in this report to:
| ● | the 2027 fiscal year and comparable terminology mean the fiscal year that began February 2, 2026, and will end January 31, 2027; and |
| ● | the 2026 fiscal year and comparable terminology mean the fiscal year that began February 3, 2025, and ended February 1, 2026. |
Dollar amounts presented in the tables below are in thousands except for per share data.
The following discussion should be read in conjunction with the condensed consolidated financial statements, including the related notes, contained elsewhere in this quarterly report. We also encourage users of this report to familiarize themselves with all our recent public filings made with the SEC, especially our 2026 Annual Report. Our 2026 Annual Report contains critical information regarding known risks and uncertainties that we face, critical accounting policies and information on commitments and contractual obligations that are not reflected in our condensed consolidated financial statements, as well as a more thorough and detailed discussion of our corporate strategy and new business initiatives.
Our 2026 Annual Report and other public filings made with the SEC are available, without charge, at www.sec.gov and at http://investors.hookerfurnishings.com.
Overview
Hooker Furnishings Corporation, incorporated in Virginia in 1924, is a designer, marketer, and importer of casegoods (wooden and metal furniture), leather furniture, fabric-upholstered furniture, lighting, accessories, and home décor for the residential, hospitality and contract markets. We also domestically manufacture premium residential custom leather, custom fabric-upholstered furniture and outdoor furniture.
Orders and Backlog
In the discussion below and herein, we reference changes in sales orders or “orders” and sales order backlog (unshipped orders at a point in time) or “backlog” over and compared to certain periods of time and changes discussed are in sales dollars and not units of inventory, unless stated otherwise. We believe orders are generally good current indicators of sales momentum and business conditions. If the items ordered are in stock and the customer has requested immediate delivery, we generally ship products in about seven days or less from receipt of order; however, orders may be shipped later if they are out of stock or there are production or shipping delays or the customer has requested the order to be shipped at a later date or has requested that we ship the order “in-full”, meaning all products ordered for the end-user must ship together. It is our policy and industry practice to allow order cancellation for casegoods up to the time of shipment or, in the case of container direct orders, up until the time the container is booked with the ocean freight carrier; therefore, customer orders for casegoods are not firm. However, domestically produced upholstered products are predominantly custom-built and consequently, cannot be cancelled once the leather or fabric has been cut. Additionally, our hospitality products are highly customized and are generally not cancellable. Similarly, for our outdoor furnishings, most orders require a deposit upon order and the balance before production is started and hence are generally not cancellable.
For the Hooker Branded and Domestic Upholstery segments, we generally consider backlogs to be one helpful indicator of sales for the upcoming 30-day period, but because of our relatively quick delivery and our cancellation policies, we do not consider order backlogs to be a reliable indicator of expected long-term sales.
At August 2, 2026, our backlog of unshipped orders was as follows:
| Order Backlog | ||||||||||||
| (Dollars in 000s) | ||||||||||||
| Reporting Segment | August 2, 2026 | February 1, 2026 | August 3, 2025 | |||||||||
| Hooker Branded | $ | 21,150 | $ | 16,490 | $ | 15,701 | ||||||
| Domestic Upholstery | 20,230 | 19,557 | 19,313 | |||||||||
| All Other | 1,036 | 7,807 | 4,912 | |||||||||
| Consolidated | $ | 42,416 | $ | 43,854 | $ | 39,926 | ||||||
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Consolidated backlog at the end of the second quarter of fiscal 2027 increased 6.2% compared with the end of the prior-year second quarter and 8.4% from the end of the first quarter of fiscal 2027. The increases were primarily driven by higher Hooker Branded backlog. Domestic Upholstery backlog also increased, primarily due to higher private-label orders. All Other backlog decreased significantly during the six-month period, primarily due to large hospitality shipments during the first quarter and the project-based nature of the hospitality business.
Executive Summary
Tariff-related matters:
In February 2026, the U.S. Supreme Court ruled that certain tariffs imposed pursuant to the International Emergency Economic Powers Act (“IEEPA”) exceeded the authority granted under the statute. In March 2026, the U.S. Court of International Trade directed U.S. Customs and Border Protection to establish a process for refunding tariffs previously collected under IEEPA.
Prior to the U.S. Supreme Court’s February 2026 decision invalidating the IEEPA tariffs, the Company incurred an estimated $10.3 million of cumulative pre-tax costs related to tariffs in fiscal year 2026, which had a significant adverse impact on the fiscal 2026 results, and significantly exceeded the tariff recoveries the Company received. Following the imposition of IEEPA tariffs beginning in April 2025, the Company elected to honor pricing on its existing customer backlog and, for competitive and administrative reasons, did not immediately adjust pricing on certain other products. The Company's pricing reflects its total cost structure and the competitive and macro-economic environment in which it operates, with tariffs being only one of many factors considered.
During the second quarter of fiscal 2027, the Company received $7.9 million in recoveries related to tariffs imposed under the IEEPA on imported products from the implementation of the tariffs through the U.S. Supreme Court’s decision in early February 2026. Most of the products associated with these recoveries had been sold during fiscal 2026. In continuing operations, the Company recorded $4.3 million as a reduction of cost of sales and $201,000 as interest income in the second quarter of fiscal 2027, partially offset by a $522,000 reduction of revenue. In discontinued operations, the Company recorded $1.6 million as a reduction of cost of sales and $54,000 interest income, partially offset by a $612,000 reduction of revenue. Additionally, approximately $1.8 million of the tariff recoveries had not yet impacted costs of sales and was recorded as a reduction of the carrying value of inventories at quarter end. The Company does not expect to receive material additional tariff recoveries.
Results of Operations and Financial Position
During the second quarter of fiscal 2027, consolidated net sales decreased by $6.0 million, or 8.7%, versus the prior year three-month period, reflecting declines in our two reportable segments and All Other. Hooker Branded was affected by lower unit volume and higher promotional discounts, while Domestic Upholstery declines in upscale leather and custom fabric were partially offset by growth in private-label and outdoor furnishings. All Other decreased primarily due to hospitality project timing. Despite lower net sales, consolidated gross profit increased by $2.9 million, and gross margin increased by 690 basis points, primarily due to tariff recoveries and higher average selling prices at Hooker Branded. The Company reported an operating income of $1.3 million, compared to a $0.5 million loss in the prior-year second quarter. Consolidated net income from continuing operations was $1.2 million, or $0.11 per diluted share.
During the first six months of fiscal 2027, consolidated net sales decreased by $7.7 million, or 5.5%, versus the prior year six-month period. The decrease reflected lower Hooker Branded unit volume, higher promotional discounts, and first-quarter inventory constraints in imported upholstery, as well as continued weakness in Domestic Upholstery’s upscale leather and custom fabric businesses. All Other was affected by hospitality project timing, with approximately 80% of first-half shipments occurring during the first quarter. Consolidated gross profit increased by $5.5 million, and gross margin increased by 560 basis points, driven primarily by tariff recoveries, as well as improvements in Hooker Branded and Domestic Upholstery. The Company reported an operating income of $2.9 million, compared to a $1.0 million loss in the prior-year first half, representing $3.9 million improvement. Consolidated net income from continuing operations was $2.3 million, or $0.21 per diluted share.
In addition to improved profitability, the Company significantly improved its liquidity and financial flexibility during the quarter. Cash and cash equivalent increased to $18.7 million at the end of second quarter, with no outstanding term loan balance, compared to $1.1 million cash on hand and $3.6 million term loan balance at fiscal 2026 year-end, primarily reflecting tariff refund proceeds and accounts receivable collections. For the six-month period, $24.0 million in cash generated from operating activities funded the repayment of $3.6 million of principal amount of outstanding loans, $2.5 million in cash dividends, $1.3 million for share repurchases under the previously authorized $5 million share repurchase program, and $1.1 million capital expenditures.
Our fiscal 2027 second quarter and first-half performance is discussed in greater detail below under “Results of Operations – Continuing Operations” and “Results of Operations – Discontinued Operations”.
23
Results of Operations – Continuing Operations
The following table sets forth the percentage relationship to net sales of certain items included in the condensed consolidated statements of income included in this report.
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net sales | 100 | % | 100 | % | 100 | % | 100 | % | ||||||||
| Cost of sales | 68.2 | 75.1 | 69.3 | 74.9 | ||||||||||||
| Gross profit | 31.8 | 24.9 | 30.7 | 25.1 | ||||||||||||
| Selling and administrative expenses | 28.9 | 24.7 | 27.7 | 24.8 | ||||||||||||
| Intangible asset amortization | 0.9 | 0.9 | 0.8 | 0.9 | ||||||||||||
| Operating income / (loss) | 2.0 | (0.7 | ) | 2.2 | (0.7 | ) | ||||||||||
| Other income | 0.6 | - | 0.3 | 0.1 | ||||||||||||
| Interest expense | 0.2 | 0.2 | 0.2 | 0.4 | ||||||||||||
| Income / (Loss) from continuing operations before income taxes | 2.4 | (1.0 | ) | 2.2 | (1.0 | ) | ||||||||||
| Income tax expense / (benefit) | 0.5 | (0.2 | ) | 0.5 | (0.2 | ) | ||||||||||
| Net income / (loss) from continuing operations | 1.9 | (0.8 | ) | 1.7 | (0.8 | ) | ||||||||||
Fiscal 2027 Second Quarter and First Half Compared to Fiscal 2026 Second Quarter and First Half
| Net Sales | ||||||||||||||||||||||||||||||||||||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| %
Net Sales | %
Net Sales | $ Change | % Change | %
Net Sales | %
Net Sales | $ Change | % Change | |||||||||||||||||||||||||||||||||||||||||
| Hooker Branded | $ | 34,620 | 54.7 | % | $ | 36,250 | 52.4 | % | $ | (1,630 | ) | -4.5 | % | $ | 69,950 | 52.7 | % | $ | 73,359 | 52.2 | % | $ | (3,409 | ) | -4.6 | % | ||||||||||||||||||||||
| Domestic Upholstery | 27,152 | 42.9 | % | 28,677 | 41.4 | % | (1,525 | ) | -5.3 | % | 55,506 | 41.8 | % | 57,590 | 41.0 | % | (2,084 | ) | -3.6 | % | ||||||||||||||||||||||||||||
| All Other | 1,478 | 2.3 | % | 4,316 | 6.2 | % | (2,838 | ) | -65.8 | % | 7,246 | 5.5 | % | 9,478 | 6.7 | % | (2,232 | ) | -23.5 | % | ||||||||||||||||||||||||||||
| Consolidated | $ | 63,250 | 100 | % | $ | 69,243 | 100 | % | $ | (5,993 | ) | -8.7 | % | $ | 132,702 | 100 | % | $ | 140,427 | 100 | % | $ | (7,725 | ) | -5.5 | % | ||||||||||||||||||||||
| Unit Volume | FY27 Q2 vs. FY26 Q2 Change | FY27 YTD vs. FY26 YTD Change | Average Selling Price ("ASP") | FY27 Q2 vs. FY26 Q2 Change | FY27 YTD vs. FY26 YTD Change | |||||||||||||
| Hooker Branded | -11.9 | % | -15.3 | % | Hooker Branded | 9.9 | % | 11.9 | % | |||||||||
| Domestic Upholstery | -6.9 | % | -6.4 | % | Domestic Upholstery | 1.5 | % | 2.7 | % | |||||||||
| All Other | -21.9 | % | 53.6 | % | All Other | -17.0 | % | -31.5 | % | |||||||||
| Consolidated | -10.8 | % | -5.8 | % | Consolidated | 6.3 | % | 1.7 | % | |||||||||
Consolidated net sales decreased by $6.0 million or 8.7%, and $7.7 million, or 5.5%, during the second quarter and first six months of fiscal 2027, respectively, compared with the corresponding prior-year periods. The decreases were attributable to lower net sales in our two reportable segments and All Other.
| ● | The Hooker Branded segment’s net sales decreased by $1.6 million, or 4.5%, and $3.4 million, or 4.6%, during the second quarter and first six months of fiscal 2027, respectively. The decreases were driven by lower unit volume, higher promotional discounts, and key SKU out-of-stocks, due to significantly longer lead times out of Asia, partially offset by higher average selling prices. Discounts as a percentage of net sales were 1,170 and 670 basis points higher during the respective periods, with the quarterly increase primarily attributable to broad-based e-commerce promotions. The imported upholstery product line accounted for approximately 47% of the six-month decrease due to first-quarter inventory constraints, including lower in-stock positions, production delays, and product-mix transitions, which have largely eased by the end of the second quarter. |
24
| ● | The Domestic Upholstery segment’s net sales decreased by $1.5 million, or 5.3%, and $2.1 million, or 3.6%, during the second quarter and first six months of fiscal 2027, respectively. Lower unit volume in the upscale leather furniture and the custom fabric upholstery product lines was largely offset by double-digit net sales growth in the private-label and outdoor furnishings businesses. Although average selling prices increased in all divisions during both periods, the segment’s overall average selling price increased only modestly, reflecting a lower proportion of higher-priced, upscale leather furniture sales. |
| ● | All Other’s net sales decreased by $2.8 million, or 65.8%, and $2.2 million, or 23.5%, during the second quarter and first six months of fiscal 2027, respectively. Due to the project-based nature of the hospitality business, quarterly net sales fluctuate based on project timing and customer needs, with approximately 80% of first half of fiscal 2027 shipments occurring during the first quarter. Second-quarter net sales also included an approximately $0.5 million reduction in revenue for the portion of the tariff recoveries to be credited to customers. |
| Gross Profit and Margin | ||||||||||||||||||||||||||||||||||||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| %
Net Sales | %
Net Sales | $ Change | % Change | %
Net Sales | %
Net Sales | $ Change | % Change | |||||||||||||||||||||||||||||||||||||||||
| Hooker Branded | $ | 13,722 | 39.6 | % | $ | 10,541 | 29.1 | % | $ | 3,181 | 30.2 | % | $ | 27,639 | 39.5 | % | $ | 21,605 | 29.5 | % | $ | 6,034 | 27.9 | % | ||||||||||||||||||||||||
| Domestic Upholstery | 6,233 | 23.0 | % | 5,305 | 18.5 | % | 928 | 17.5 | % | 11,198 | 20.2 | % | 10,585 | 18.4 | % | 613 | 5.8 | % | ||||||||||||||||||||||||||||||
| All Other | 144 | 9.7 | % | 1,396 | 32.3 | % | (1,252 | ) | -89.7 | % | 1,854 | 25.6 | % | 2,987 | 31.5 | % | (1,133 | ) | -37.9 | % | ||||||||||||||||||||||||||||
| Consolidated | $ | 20,099 | 31.8 | % | $ | 17,242 | 24.9 | % | $ | 2,857 | 16.6 | % | $ | 40,691 | 30.7 | % | $ | 35,177 | 25.1 | % | $ | 5,514 | 15.7 | % | ||||||||||||||||||||||||
Consolidated gross profit increased by $2.9 million and $5.5 million during the second quarter and first six months of fiscal 2027, respectively, compared with the corresponding prior-year periods. Gross margin increased by 690 and 560 basis points during the respective periods. These improvements were primarily driven by Hooker Branded and, to a lesser extent, Domestic Upholstery, partially offset by lower gross profit in All Other, primarily due to lower net sales.
| ● | The Hooker Branded segment’s gross profit increased by $3.2 million and $6.0 million during the second quarter and first six months of fiscal 2027, respectively, compared with the corresponding prior-year periods. Gross margin increased by 1,050 and 1,000 basis points during the respective periods, primarily attributable to a $2.5 million tariff recoveries recorded as a reduction of cost of sales, which increased gross margin by approximately 720 basis points during the second quarter and 360 basis points during the six-month period. Higher average selling prices also contributed to the improvements. These improvements more than offset the impact of increased e-commerce promotional discounting and higher warehousing and distribution expenses, the latter of which increased by 160 and 120 basis points during the second quarter and six-month period, respectively. The increases primarily reflected costs associated with the Company’s Vietnam warehouse, which was launched during the prior-year second quarter, and higher compensation costs. |
| ● | The Domestic Upholstery segment’s gross profit increased by $928,000 and $613,000 during the second quarter and first six months of fiscal 2027, and gross margin increased by 450 and 180 basis points, respectively, compared with the corresponding prior-year periods. During the second quarter, the segment recorded an approximately $800,000 reduction of cost of sales related to tariff recoveries on imported materials, which increased gross margin by approximately 300 basis points for the quarter and 150 basis points for the six-month period. Performance varied across the segment’s four divisions. Gross profit and margin improved in the outdoor furnishings and private-label businesses due to certain lower imported-material costs and improved overhead absorption resulting from higher sales. These improvements were partially offset by higher cost of sales in the upscale leather furniture and custom fabric upholstery businesses. |
| ● | All Other’s gross profit included a net tariff recovery of approximately $0.5 million during the second quarter, consisting of a $1.0 million reduction of cost of sales, partially offset by a $0.5 million reduction of revenue for the portion of the recoveries to be credited to customers. This benefit was insufficient to offset the impact of significantly lower shipment volume during the quarter, primarily due to the timing of hospitality projects. |
25
| Selling and Administrative Expenses (S&A) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| %
Net Sales | % Net Sales | $ Change | % Change | %
Net Sales | % Net Sales | $ Change | % Change | |||||||||||||||||||||||||||||||||||||||||
| Hooker Branded | $ | 12,852 | 37.1 | % | $ | 10,532 | 29.1 | % | $ | 2,320 | 22.0 | % | $ | 25,563 | 36.5 | % | $ | 21,569 | 29.4 | % | $ | 3,994 | 18.5 | % | ||||||||||||||||||||||||
| Domestic Upholstery | 4,856 | 17.9 | % | 5,169 | 18.0 | % | (313 | ) | -6.1 | % | 9,966 | 18.0 | % | 10,458 | 18.2 | % | (492 | ) | -4.7 | % | ||||||||||||||||||||||||||||
| All Other | 564 | 38.2 | % | 1,426 | 33.0 | % | (862 | ) | -60.4 | % | 1,212 | 16.7 | % | 2,867 | 30.2 | % | (1,655 | ) | -57.7 | % | ||||||||||||||||||||||||||||
| Consolidated | $ | 18,272 | 28.9 | % | $ | 17,127 | 24.7 | % | $ | 1,145 | 6.7 | % | $ | 36,741 | 27.7 | % | $ | 34,894 | 24.8 | % | $ | 1,847 | 5.3 | % | ||||||||||||||||||||||||
Consolidated selling and administrative (“S&A”) expenses increased in absolute terms and as a percentage of net sales during the second quarter and first six months of fiscal 2027, driven by higher expenses in Hooker Branded and partially offset by decreases in Domestic Upholstery and All Other.
| ● | The Hooker Branded segment’s S&A expenses increased by $2.3 million and $4.0 million during the second quarter and first six months of fiscal 2027, respectively, compared with the corresponding prior-year periods. The increases were primarily driven by administrative costs retained following the Home Meridian segment divestiture and performance-based incentive compensation accruals reflecting current-year profitability. These administrative costs remained below management’s expectations. Compensation expenses accounted for more than 80% and 70% of the increases during the second quarter and six-month period, respectively. The remaining increases primarily reflected higher consulting and IT-related expenses supporting the Company’s ERP system and amortization expense associated with its new website. These increases were partially offset by lower selling expenses resulting from lower net sales, particularly discounted e-commerce sales that carry lower commission rates; lower bad debt expense due to reduced accounts receivable balances; and lower severance expense. |
| ● | The Domestic Upholstery segment’s S&A expenses decreased by $313,000 and $492,000 during the second quarter and first six months of fiscal 2027, respectively, compared with the corresponding prior-year periods. The decreases were primarily attributable to lower salary and rent expenses resulting from previously implemented cost-reduction actions. Selling expenses decreased due to lower sales in the upscale leather and custom fabric upholstery businesses. In addition, private-label sales and a significant portion of outdoor furnishings sales through the e-commerce channel carried lower commission rates, limiting selling expense growth despite higher sales in both businesses. These decreases were partially offset by higher professional services expenses, advertising supplies, and increases in other operating expenses. |
| ● | All Other S&A expenses decreased in both periods due to lower operating expenses in the hospitality business following the consolidation of certain operations and the absence of administrative expense allocations from the former Home Meridian segment. |
| Intangible Asset Amortization | ||||||||||||||||||||||||||||||||||||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| %
Net Sales | %
Net Sales | $ Change | % Change | %
Net Sales | %
Net Sales | $ Change | % Change | |||||||||||||||||||||||||||||||||||||||||
| Intangible asset amortization | 544 | 0.9 | % | 625 | 0.9 | % | $ | (81 | ) | -13.0 | % | 1,089 | 0.8 | % | 1,292 | 0.9 | % | $ | (203 | ) | -15.7 | % | ||||||||||||||||||||||||||
Intangible asset amortization decreased compared to the prior-year second quarter, due to the absence of amortization related to the Home Meridian trade name allocated to the hospitality business, which was reclassified to All Other. The decrease during the six-month period also reflected the absence of amortization expenses related to the Sam Moore trade name. See Note 9 to our condensed consolidated financial statements for additional information.
26
| Operating Profit / (Loss) and Margin | ||||||||||||||||||||||||||||||||||||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| %
Net Sales | %
Net Sales | $ Change | % Change | %
Net Sales | %
Net Sales | $ Change | % Change | |||||||||||||||||||||||||||||||||||||||||
| Hooker Branded | $ | 870 | 2.5 | % | $ | 10 | 0.0 | % | $ | 860 | 8600.0 | % | $ | 2,076 | 3.0 | % | $ | 37 | 0.0 | % | $ | 2,039 | 5510.8 | % | ||||||||||||||||||||||||
| Domestic Upholstery | 833 | 3.1 | % | (408 | ) | -1.4 | % | 1,241 | 304.2 | % | 144 | 0.3 | % | (1,004 | ) | -1.7 | % | 1,148 | 114.3 | % | ||||||||||||||||||||||||||||
| All Other | (420 | ) | -28.4 | % | (112 | ) | -2.6 | % | (308 | ) | -275.0 | % | 641 | 8.8 | % | (42 | ) | -0.4 | % | 683 | 1626.2 | % | ||||||||||||||||||||||||||
| Consolidated | $ | 1,283 | 2.0 | % | $ | (510 | ) | -0.7 | % | $ | 1,793 | 351.6 | % | $ | 2,861 | 2.2 | % | $ | (1,009 | ) | -0.7 | % | $ | 3,870 | 383.5 | % | ||||||||||||||||||||||
The Company reported operating income of $1.3 million and $2.9 million during the second quarter and first six months of fiscal 2027, respectively, compared with operating losses of $0.5 million and $1.0 million in the corresponding prior-year periods. Both reportable segments generated operating income during both periods. All Other reported a second-quarter operating loss due to lower hospitality sales but remained profitable for the six-month period due to higher first-quarter shipments.
| Income taxes | ||||||||||||||||||||||||||||||||||||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| %
Net Sales | %
Net Sales | $ Change | % Change | %
Net Sales | %
Net Sales | $ Change | % Change | |||||||||||||||||||||||||||||||||||||||||
| Consolidated income tax expense / (benefit) | $ | 338 | 0.5 | % | $ | (114 | ) | -0.2 | % | $ | 452 | 396.5 | % | $ | 664 | 0.5 | % | $ | (278 | ) | -0.2 | % | $ | 942 | 338.8 | % | ||||||||||||||||||||||
| Effective Tax Rate | 21.3 | % | 17.3 | % | 22.3 | % | 19.3 | % | ||||||||||||||||||||||||||||||||||||||||
For the second quarters of fiscal 2027 and fiscal 2026, we recorded income tax expense of $338,000 and income tax benefit of $114,000 under continuing operations. The effective tax rate for continuing operations was 21.3% for the second quarter of fiscal 2027 compared to 17.3% for the second quarter of fiscal 2026.
For the first half of fiscal 2027 and fiscal 2026, we recorded income tax expense of $664,000 and income tax benefit of $278,000 under continuing operations. The effective tax rate for continuing operations was 22.3% for the first six months of fiscal 2027 compared to 19.3% for the first six months of fiscal 2026.
The increase in both periods was primarily due to a prior-year state net operating loss valuation allowance adjustment, along with the shifting tax impact of company-owned life insurance gains and restricted stock compensation relative to prior-year operating losses versus current-year operating income.
| Net Income / (Loss) from Continuing Operations | ||||||||||||||||||||||||||||||||||||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| %
Net Sales | %
Net Sales | $ Change | % Change | %
Net Sales | %
Net Sales | $ Change | % Change | |||||||||||||||||||||||||||||||||||||||||
| Net income / (loss) from Continuing Operations | $ | 1,205 | 1.9 | % | $ | (545 | ) | -0.8 | % | $ | 1,750 | 321.1 | % | $ | 2,309 | 1.7 | % | $ | (1,160 | ) | -0.8 | % | $ | 3,469 | 299.1 | % | ||||||||||||||||||||||
| Diluted earnings / (loss) from continuing operations per share | $ | 0.11 | $ | (0.06 | ) | $ | 0.21 | $ | (0.11 | ) | ||||||||||||||||||||||||||||||||||||||
27
Results of Operations – Discontinued Operations
The following table sets forth the percentage relationship to net sales of certain items included in the condensed consolidated statements of income included in this report.
| For the | ||||||||||||||||||||||||||||||||||||||||||||||||
| Thirteen Weeks Ended | Twenty-Six Weeks Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| August 2, | August 3, | August 2, | August 3, | |||||||||||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||||||||||||||||||||||||
| %
Net Sales |
%
Net Sales |
$ Change | % Change | %
Net Sales |
%
Net Sales |
$ Change | % Change | |||||||||||||||||||||||||||||||||||||||||
| Net sales | $ | (939 | ) | 100.0 | % | $ | 12,905 | 100.0 | % | $ | (13,844 | ) | -107.3 | % | $ | (939 | ) | 100.0 | % | $ | 27,038 | 100.0 | % | $ | (27,977 | ) | -103.5 | % | ||||||||||||||||||||
| Cost of sales | (1,546 | ) | 164.6 | % | 13,095 | 101.5 | % | (14,641 | ) | -111.8 | % | (1,503 | ) | 160.1 | % | 25,945 | 96.0 | % | (27,448 | ) | -105.8 | % | ||||||||||||||||||||||||||
| Gross profit / (loss) | 607 | -64.6 | % | (190 | ) | -1.5 | % | 797 | 419.5 | % | 564 | -60.1 | % | 1,093 | 4.0 | % | (529 | ) | -48.4 | % | ||||||||||||||||||||||||||||
| S&A expenses | - | 0.0 | % | 3,455 | 26.8 | % | (3,455 | ) | -100.0 | % | - | 0.0 | % | 7,557 | 27.9 | % | (7,557 | ) | -100.0 | % | ||||||||||||||||||||||||||||
| Intangible asset amortization | - | 0.0 | % | 246 | 1.9 | % | (246 | ) | -100.0 | % | - | 0.0 | % | 492 | 1.8 | % | (492 | ) | -100.0 | % | ||||||||||||||||||||||||||||
| Other income items that are not major | (54 | ) | 5.8 | % | (70 | ) | -0.5 | % | 16 | 22.9 | % | (54 | ) | 5.8 | % | (98 | ) | -0.4 | % | 44 | 44.9 | % | ||||||||||||||||||||||||||
| Pretax income / (loss) of discontinued operations related to major classes | 661 | -70.4 | % | (3,821 | ) | -29.6 | % | 4,482 | 117.3 | % | 618 | -65.8 | % | (6,858 | ) | -25.4 | % | 7,476 | 109.0 | % | ||||||||||||||||||||||||||||
| Loss on sale of the discontinued operations | 74 | -7.9 | % | - | 0.0 | % | 74 | 100 | % | 74 | -7.9 | % | - | 0.0 | % | 74 | 100 | % | ||||||||||||||||||||||||||||||
| Income / (Loss) from discontinued operations before income taxes | 587 | -62.5 | % | (3,821 | ) | -29.6 | % | 4,408 | 115.4 | % | 544 | -57.9 | % | (6,858 | ) | -25.4 | % | 7,402 | 107.9 | % | ||||||||||||||||||||||||||||
| Income tax expense / (benefit) | 122 | -13.0 | % | (1,089 | ) | -8.4 | % | 1,211 | 111.2 | % | 122 | -13.0 | % | (1,689 | ) | -6.2 | % | 1,811 | 107.2 | % | ||||||||||||||||||||||||||||
| Net income / (loss) from discontinued operations | 465 | -49.5 | % | (2,732 | ) | -21.2 | % | 3,197 | 117.0 | % | 422 | -44.9 | % | (5,169 | ) | -19.1 | % | 5,591 | 108.2 | % | ||||||||||||||||||||||||||||
Although the divestiture was completed in the prior fiscal year, current-period activities in discontinued operations primarily reflected tariff recoveries received by the Company. The $612,000 of the recoveries to be credited to customers were recorded as a reduction of revenue to reflect the corresponding customer reimbursement. The $1.6 million refunds of tariff costs previously recognized in cost of sales were recorded as a reduction of cost of sales. Current-period activity also included approximately $0.5 million of additional charges arising from the net settlement of various divestiture-related balances with the buyer. See Note 3 to our condensed consolidated financial statements for additional information.
Outlook
Market conditions remain challenging as consumers continue to be selective and housing turnover and demand for big-ticket discretionary products remain weak. In July, retail sales at furniture and home furnishings stores were essentially flat sequentially but decreased 1.2% year over year, while existing-home sales declined 1.7% month over month to a seasonally adjusted annual rate of 4.1 million, remaining at historically low levels. Consumer sentiment decreased 6.3% in August, and July headline inflation remained elevated at 3.4%, although core inflation eased to 2.5%. These factors, together with elevated financing costs, continue to pressure discretionary purchasing power. The Company also continues to monitor tariff developments.
Given these conditions, the Company does not expect meaningful near-term improvement in market demand. However, changes to the Company’s cost structure and portfolio are delivering tangible benefits and are expected to support improved results compared with the prior-year period, even if current conditions persist.
With the principal cost-reduction initiatives completed, the Company is focused on disciplined execution across its core businesses and converting improved order momentum into sales. Actions taken during the past 18 to 24 months have created a leaner and more disciplined operating model designed to generate stronger and more consistent earnings over time.
Retailer response to Margaritaville remains encouraging, with commitments to approximately 100 in-store galleries and 10 free-standing retail stores, roughly double the levels reported in December. Shipments began during the second quarter and are expected to build through the second half of fiscal 2027 and into fiscal 2028. Together with Hooker Branded order momentum, the Margaritaville rollout positions the Company to capitalize on opportunities as demand recovers.
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Financial Condition, Liquidity and Capital Resources
Summary Cash Flow Information – Operating, Investing and Financing Activities
| Twenty-Six Weeks Ended | ||||||||
| August 2, | August 3, | |||||||
| 2026 | 2025 | |||||||
| Net cash provided by operating activities | 24,037 | 20,924 | ||||||
| Net cash used in investing activities | (873 | ) | (1,896 | ) | ||||
| Net cash used in financing activities | (7,305 | ) | (21,560 | ) | ||||
| Net cash provided by / (used in) discontinued operations | 1,689 | (2,942 | ) | |||||
| Net increase / (decrease) in cash and cash equivalents | $ | 17,548 | $ | (5,474 | ) | |||
Cash and cash equivalents increased by $17.5 million during the first six months of fiscal 2027 to $18.7 million, compared with a $5.5 million decrease in the prior-year period. The increase primarily reflected $24.0 million provided by operating activities from continuing operations and $1.7 million provided by discontinued operations, partially offset by $7.3 million used in financing activities and $873,000 used in investing activities. Current-period cash flows included $7.9 million of tariff recoveries, of which $1.7 million related to discontinued operations.
| ● | Cash provided by operating activities under continuing operations increased to $24.0 million from $20.9 million in the prior-year period. The increase primarily reflected improved operating results and tariff recoveries, partially offset by lower cash generated from working capital. Significant working capital changes included: |
| ○ | Accounts receivable: provided $10.7 million of cash inflow, compared with $13.0 million in the prior-year period, reflecting collections of large project-based receivables in both periods. The smaller decrease provided $2.3 million less cash than in the prior-year period. |
| ○ | Inventories: provided $5.3 million of cash inflow, compared with $10.2 million in the prior-year period. The current-period decrease included a $1.8 million reduction in inventory carrying values related to tariff recoveries; however, the overall decrease provided $5.0 million less cash than in the prior-year period. |
| ○ | Prepaid expenses and other assets: $0.8 million of cash outflow, compared with $2.6 million in the prior-year period, primarily due to decreases in prepaid rent in previously terminated leases and the absence of material ERP-related expenditures during the current period. |
| ○ | Accounts payable: provided $0.6 million of cash inflow, compared with a $1.3 million use of cash in the prior-year period, primarily due to the timing of inventory purchases and vendor payments. |
| ○ | Accrued compensation: provided $1.2 million of cash inflow, compared with $0.6 million in the prior-year period, primarily reflecting incentive compensation accruals and the timing of payments. |
| ● | Cash used in investing activities decreased to $873,000 from $1.9 million in the prior-year period, primarily due to lower capital expenditures and $540,000 of proceeds from company-owned life insurance policies. |
| ● | Cash used in financing activities decreased to $7.3 million from $21.6 million in the prior-year period, primarily due to lower debt repayments and dividend payments, partially offset by $1.3 million of share repurchases during the current period. |
| ● | Discontinued operations provided $1.7 million of cash during the current period, compared with a $2.9 million use of cash in the prior-year period. The current-period inflow reflected the portion of the Company’s tariff recoveries related to discontinued operations. |
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Liquidity, Financial Resources and Capital Expenditures
Our sources of liquidity are:
| ● | available cash and cash equivalents, which are highly dependent on incoming order rates and our operating performance; |
| ● | expected cash flow from operations; |
| ● | available lines of credit; and |
| ● | cash surrender value of Company-owned life insurance. |
The most significant components of our working capital are inventory, accounts receivable and cash and cash equivalents reduced by accounts payable and accrued expenses.
Our most significant ongoing short-term cash requirements relate primarily to funding operations (including expenditures for inventory, lease payments and payroll), quarterly dividend payments and capital expenditures related primarily to our showroom renovations and upgrading systems, buildings and equipment. The timing of our working capital needs can vary greatly depending on demand for and availability of raw materials and imported finished goods but is generally the greatest in mid-summer as a result of inventory build-up for the traditional fall selling season. Long-term cash requirements relate primarily to funding lease payments.
Loan Agreements and Revolving Credit Facility
On December 5, 2024, the Company and its wholly owned subsidiaries, Bradington-Young, LLC, Sam Moore Furniture LLC and Home Meridian Group, LLC (together with the Company, the “Borrowers”), entered into an Amended and Restated Loan and Security Agreement (the “Amended and Restated Loan Agreement”) with Bank of America, N.A. (“BofA”), as lender. The Amended and Restated Loan Agreement amends, restates and replaces the Second Amended and Restated Loan Agreement, dated as of September 29, 2017, between the Borrowers and BofA, as amended (the “Existing Loan Agreement”). The outstanding principal amount of loans and letters of credit issued under the Existing Loan Agreement and used to collateralize certain insurance arrangements and for imported product purchases will remain outstanding as loans and letters of credit under the Amended and Restated Loan Agreement.
The Amended and Restated Loan Agreement provides for a revolving credit facility in a committed principal amount of up to $70,000,000 (the “Revolving Commitment”), including subline of $8,000,000 for letters of credit, and an option to increase the Revolving Commitment by up to $30,000,000 upon meeting certain conditions, including agreement by BofA to increase the Revolving Commitment by such amount. Proceeds of loans and letters of credit under the Amended and Restated Loan Agreement will be available for general working capital and other corporate purposes of the Borrower.
Availability of loans and letters of credit under the Revolving Commitment is capped by a borrowing base formula calculated as of any date as the sum for the Borrowers of (a) the value of their accounts receivable, (b) the value of their inventory, (c) the value of their in-transit inventory and (d) the life insurance cash surrender value of Company-owned life insurance policies, in each case subject to eligibility requirements, advance rates, valuation metrics, reductions for write-offs and other dilutive items and reserves (the “Borrowing Base”). The lesser of the Revolving Commitment and the Borrowing Base, in each case net of the principal amount of outstanding loans and the face amount of letters of credit, constitutes “Availability” under the Amended and Restated Credit Agreement.
Outstanding loans under the Amended and Restated Loan Agreement will bear interest at a rate per annum equal to the then-current Term SOFR Rate for a period of one month plus 0.10% plus a margin of 1.75%. The Term SOFR Rate will be adjusted on a monthly basis. Letters of credit are subject to a letter of credit fee equal to the actual daily amount of undrawn letters of credit multiplied by a per annum rate of 1.75% and a fronting fee equal to the actual daily amount of undrawn letters of credit multiplied by a per annum rate of 0.125%. We must also pay a monthly unused commitment fee that is based on the average daily unused amount of Revolving Commitment multiplied by a per annum rate of 0.25%. All accrued interest and fees are payable in cash monthly in arrears.
We may prepay any outstanding principal amounts borrowed under the Amended and Restated Loan Agreement at any time, without penalty provided that any payment is accompanied by all accrued interest owed. Subject to the Borrowers having sufficient borrowing base capacity and customary conditions precedent to borrowing, amounts repaid may be reborrowed. The Revolving Commitment will terminate, and all amounts outstanding thereunder will be due and payable, on December 5, 2029.
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The obligations under the Amended and Restated Loan Agreement are secured by a first priority security interest in substantially all of the assets of the Borrowers, other than real estate, including all Company-owned life insurance policies, all accounts receivable, all inventory, all intellectual property, all equipment and all other personal property.
The Amended and Restated Loan Agreement includes customary representations and warranties and requires the Borrowers to comply with customary affirmative and negative covenants, including, among other things, a financial covenant requiring the maintenance of a ratio of (x) EBITDA net of capital expenditures (to the extent not paid using Borrowed Money) to (y) the sum of debt service and dividends paid, in each case as of the last day of each month for the trailing twelve-month period ending on such day, of at least 1.0 to 1.0, if an event of default has occurred and is continuing or Availability has fallen below 10% of the Revolving Commitment at any time (until such time as both Availability is 10% or greater and no event of default exists, for the 30 consecutive days prior to such month end).
The Amended and Restated Loan Agreement also limits the Borrowers’ right to incur other indebtedness, make certain investments and create liens upon our assets, subject to certain exceptions, among other restrictions. The Amended and Restated Loan Agreement does not restrict the Company’s ability to pay cash dividends on, or repurchase, shares of its common stock, subject to (a) no default existing prior to or resulting from such dividend or repurchase, (b) Availability is not less than 15% of the Revolving Commitment for each of the preceding 45 days prior to announcement of such dividend or repurchase and after giving pro forma effect to such dividend or repurchase and (c) if Availability is less than 20% of the Revolving Commitment on any day in such 45-day period, the Borrowers are in compliance with the financial covenant described above after giving effect to such dividend or repurchase.
We incurred $598,000 in previous fiscal years in debt issuance costs in connection with our term loans. As of August 2, 2026, unamortized loan costs of $415,000 were recorded in other assets on our condensed consolidated balance sheets.
As of August 2, 2026, there were no outstanding loans, other than $3.2 million face amount of letters of credit. We had $51.8 million of Availability based on the current Borrowing Base. There were no additional borrowings outstanding under the Amended and Restated Loan Agreement as of August 2, 2026.
Share Repurchase Authorization
In fiscal 2026, our Board of Directors authorized the repurchase of up to $5 million of the Company’s common shares. The authorization did not obligate us to acquire a specific number of shares during any period and did not have an expiration date, but it could be modified, suspended, or discontinued at any time at the discretion of our Board of Directors. Repurchases could be made from time to time in the open market, or through privately negotiated transactions or otherwise, in compliance with applicable laws, rules and regulations, and subject to our cash requirements for other purposes, compliance with the covenants under the Amended and Restated Loan Agreement and other factors we deem relevant.
During fiscal 2027 first half, we used approximately $1.3 million of the authorization to purchase 92,357 of our common shares (at an average price of $13.68 per share), with approximately $3.7 million remaining available for future purchases under the authorization.
Capital Expenditures
We expect to spend approximately $2.0 million in capital expenditures in the remainder of fiscal 2027 to maintain and enhance our operating systems and facilities.
Dividends
On September 3, 2026, our board of directors declared a quarterly cash dividend of $0.115 per share which will be paid on September 30, 2026, to shareholders of record at September 15, 2026.
Critical Accounting Policies
There have been no material changes to our critical accounting policies and estimates from the information provided in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included in our 2026 Annual Report.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk
We are exposed to various types of market risk in the normal course of our business, including the impact of interest rate changes, raw materials price risk and changes in foreign currency exchange rates, which could impact our results of operations or financial condition. We manage our exposure to this risk through our normal operating activities.
Interest Rate Risk
Borrowings under the Amended and Restated Loan Agreement will bear interest at a rate per annum equal to the then-current Term SOFR Rate for a period of one month plus 0.10% plus a margin of 1.75%. The Term SOFR Rate will be adjusted on a monthly basis. As such, these debt instruments expose us to market risk for changes in interest rates. As of August 2, 2026, there were no outstanding loans, other than amounts reserved for standby letters of credit in the amount of $3.2 million.
Raw Materials Price Risk
We are exposed to market risk from changes in the cost of raw materials used in our domestic upholstery manufacturing processes; principally, wood, fabric, and foam products. Increases in home construction activity could result in increases in wood and fabric costs. Additionally, the cost of petroleum-based foam products we utilize are sensitive to crude oil prices, which vary due to supply, demand, and geo-political factors.
Currency Risk
For imported products, we generally negotiate firm pricing denominated in U.S. Dollars with our foreign suppliers, typically for periods of at least one year. We accept the exposure to exchange rate movements beyond these negotiated periods. We do not use derivative financial instruments to manage this risk but could choose to do so in the future. Most of our imports are purchased from suppliers located in Vietnam and China. The Chinese currency floats within a limited range in relation to the U.S. Dollar, resulting in exposure to foreign currency exchange rate fluctuations.
Since we transact our imported product purchases in U.S. Dollars, a relative decline in the value of the U.S. Dollar could increase the price we pay for imported products beyond the negotiated periods. We generally expect to reflect substantially all of the effect of any price increases from suppliers in the prices we charge for imported products. However, these changes could adversely impact sales volume or profit margins during affected periods.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the fiscal quarter ended August 2, 2026. Based on this evaluation, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures are effective as of August 2, 2026 to provide reasonable assurance that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to the Company’s management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure and are effective to provide reasonable assurance that such information is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting during the fiscal quarter ended August 2, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II. OTHER INFORMATION
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds (1).
| Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased As Part of Publicly Announced Program | Maximum Dollar Value of Shares That May Yet Be Purchased Under The Program | |||||||||||||
| May 4, 2026 - June 7, 2026 | 37,821 | 12.75 | 37,821 | $ | 4,904,552 | |||||||||||
| June 8, 2026 - July 5, 2026 | 13,556 | 13.98 | 13,556 | 4,422,187 | ||||||||||||
| July 6, 2026 - August 2, 2026 | 33,365 | 14.87 | 33,365 | 4,232,666 | ||||||||||||
| Total | 84,742 | $ | 13.78 | 84,742 | 3,736,618 | |||||||||||
| (1) | In fiscal 2026 fourth quarter, our Board of Directors authorized the repurchase of up to $5 million of the Company’s common shares. The authorization does not obligate us to acquire a specific number of shares during any period and does not have an expiration date, but it may be modified, suspended, or discontinued at any time at the discretion of our Board of Directors. Repurchases may be made from time to time in the open market, or through privately negotiated transactions or otherwise, in compliance with applicable laws, rules and regulations, and subject to our cash requirements for other purposes, compliance with the covenants under the loan agreement for our revolving credit facility and other factors we deem relevant. |
During the first half of fiscal 2027, pursuant to a plan compliant with the safe harbors of Rules 10b5-1 and 10b-18, we used approximately $1.3 million of the authorization to purchase 92,357 of our common shares (at an average price of $13.68 per share), with approximately $3.7 million remaining available for future purchases under the authorization.
Item 5. Other Information
During
the three months ended August 2, 2026, no director or officer of the Company
Item 6. Exhibits
| * | Filed herewith | |
| ** | Furnished herewith |
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| HOOKER FURNISHINGS CORPORATION | ||
| Date: September 11, 2026 | By: | /s/ C. Earl Armstrong III |
| C. Earl Armstrong III | ||
| Senior Vice President – Finance and | ||
| Chief Financial Officer | ||
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