NOBH 8-K
Nobility Homes Inc (NOBH)
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 12, 2021
NOBILITY HOMES, INC.
(Exact name of registrant as specified in its charter)
| Florida | 000-06506 | 59-1166102 | ||
| (State or other jurisdiction of incorporation) |
(Commission File No.) |
(IRS Employer Identification No.) | ||
| 3741 S W 7th Street Ocala, Florida |
34474 | |||
| (Address of principal executive offices) | (Zip Code) | |||
Registrant’s telephone number including area code: (352) 732-5157
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230 .425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). 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. ☐
Securities registered pursuant to Section 12(b) of the Act: None
ITEM 2.02 Results of Operations and Financial Condition
On March 12, 2021, Nobility Homes, Inc. issued a press release regarding sales and earnings results for its first quarter ended January 30, 2021.
The text of the press release is attached as Exhibit 99.1.
ITEM 9.01 Financial Statements and Exhibits
(d) Exhibits:
Exhibit 99.1 Earnings release issued March 12, 2021 by Nobility Homes, Inc.
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SIGNATURES
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 hereunto duly authorized.
| NOBILITY HOMES, INC. | ||||||||
| March 16, 2021 | By: | /s/ Lynn J. Cramer, Jr. | ||||||
| Lynn J. Cramer, Jr., Treasurer | ||||||||
| and Principal Accounting Officer | ||||||||
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Exhibit 99.1
NOBILITY HOMES, INC. ANNOUNCES SALES AND EARNINGS FOR ITS FIRST QUARTER 2021
Ocala, FL…March 12, 2021—Today Nobility Homes, Inc. (OTCQX: NOBH) announced sales and earnings for its first quarter ended January 30, 2021. Sales for the first quarter of 2021 were $9,071,511 as compared to $9,443,852 recorded in the first quarter of 2020. Income from operations for the first quarter of 2021 was $1,224,066 versus $1,633,705 in the same period a year ago. Net income after taxes was $1,065,765 as compared to $1,400,141 for the same period last year. Diluted earnings per share for the first quarter of 2021 were $0.29 per share compared to $0.38 per share last year.
Nobility’s financial position during the first quarter 2021 remains very strong with cash and cash equivalents, certificates of deposit and short term investments of $36,484,550 and no outstanding debt. Working capital is $39,420,939 and our ratio of current assets to current liabilities is 4.7:1. Stockholders’ equity is $52,042,687 and the book value per share of common stock increased to $14.33.
The Board of Directors declared a one-time cash dividend of $1.00 per common share for fiscal year 2020. The cash dividend is payable on March 26, 2021 to stockholders of record as of March 12, 2021. Nobility Homes has distributed one-time cash dividends of $1.00 in fiscal years ending 2019 and 2018, respectively.
The Company has no defined dividend policy. The Board of Directors maintains the authority to declare distributions at their discretion. The Board performs a thorough and extensive evaluation of the Company’s balance sheet, cash flow, operating performance, and future earnings prospects when considering the declaration of any common dividend.
Terry Trexler, President, stated, “The demand for affordable manufactured housing in Florida has been adversely impacted by COVID-19 and actions taken in response thereto. According to the Florida Manufactured Housing Association, shipments for the industry in Florida for the period from November 2020 through January 2021 were equal to the same period last year. In addition, the lack of lenders in our industry, partly as a result of an increase in government regulations, still adversely affects our results by limiting many affordable manufactured housing buyers from purchasing homes. Since May of 2020 the Company has experienced unprecedented inflation in forest products, with no immediate relief in sight resulting in significate increases to our material costs. The Company is monitoring these costs and have adjusted our selling prices accordingly to help offset the higher costs. The Company purchased the land for the Tavares retail sales center in January 2021 for $245,000 and in February 2021 purchased land in Ocala for a future retail sales center for $1,040,000.
Maintaining our strong financial position is vital for future growth and success. Because of very challenging business conditions during economic recessions in our market area, management will continue to evaluate all expenses and react in a manner consistent with maintaining our strong financial position, while exploring opportunities to expand our distribution and manufacturing operations.
Our many years of experience in the Florida market, combined with home buyers’ increased need for more affordable housing, should serve the Company well in the coming years. Management remains convinced that our specific geographic market is one of the best long-term growth areas in the country”.
On June 5, 2020 the Company celebrated its 53rd anniversary in business specializing in the design and production of quality, affordable manufactured homes. With multiple retail sales centers and an insurance agency subsidiary, we are the only vertically integrated manufactured home company headquartered in Florida.
MANAGEMENT WILL NOT HOLD A CONFERENCE CALL. IF YOU HAVE ANY QUESTIONS, PLEASE CALL TERRY OR TOM TREXLER @ 800-476-6624 EXT 121 OR [email protected] OR [email protected]
Certain statements in this report are unaudited or forward-looking statements within the meaning of the federal securities laws. Although Nobility believes that the amounts and expectations reflected in such forward-looking statements are based on reasonable assumptions, there are risks and uncertainties that may cause actual results to differ materially from expectations. These risks and uncertainties include, but are not limited to, the potential adverse impact on our business caused by the COVID-19 pandemic or other health pandemic, competitive pricing pressures at both the wholesale and retail levels, increasing material costs or availability of materials due to potential supply chain interruptions (such as current inflation with forest products and supply issues with vinyl siding and PVC piping), continued excess retail inventory, increase in repossessions, changes in market demand, changes in interest rates, availability of financing for retail and wholesale purchasers, consumer confidence, adverse weather conditions that reduce sales at retail centers, the risk of manufacturing plant shutdowns due to storms or other factors, the impact of marketing and cost-management programs, reliance on the Florida economy, impact of labor shortage, impact of materials shortage, increasing labor cost, cyclical nature of the manufactured housing industry, impact of rising fuel costs, catastrophic events impacting insurance costs, availability of insurance coverage for various risks to Nobility, market demographics, management’s ability to attract and retain executive officers and key personnel, increased global tensions, market disruptions resulting from terrorist or other attack and any armed conflict involving the United States and the impact of inflation.
NOBILITY HOMES, INC.
Condensed Consolidated Balance Sheets
| January 30, 2021 |
October 31, 2020 |
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| (Unaudited) | ||||||||
| Assets |
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| Current assets: |
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| Cash and cash equivalents |
$ | 32,963,523 | $ | 30,305,902 | ||||
| Certificates of Deposit |
3,082,111 | 4,602,307 | ||||||
| Short-term investments |
438,916 | 358,960 | ||||||
| Accounts receivable—trade |
1,057,086 | 790,046 | ||||||
| Note receivable |
29,259 | 35,997 | ||||||
| Mortgage notes receivable |
20,776 | 20,162 | ||||||
| Income taxes receivable |
— | 105,676 | ||||||
| Inventories |
10,604,393 | 9,294,677 | ||||||
| Pre-owned homes, net |
389,679 | 441,937 | ||||||
| Prepaid expenses and other current assets |
1,553,057 | 1,014,849 | ||||||
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| Total current assets |
50,138,800 | 46,970,513 | ||||||
| Property, plant and equipment, net |
5,363,841 | 5,142,714 | ||||||
| Pre-owned homes, net |
1,346,471 | 1,077,240 | ||||||
| Note receivable, less current portion |
6,573 | 6,573 | ||||||
| Mortgage notes receivable, less current portion |
226,286 | 227,509 | ||||||
| Other investments |
1,743,072 | 1,729,364 | ||||||
| Deferred income taxes |
3,598 | 3,598 | ||||||
| Operating lease right of use assets |
705,037 | 715,368 | ||||||
| Cash surrender value of life insurance |
3,840,452 | 3,795,902 | ||||||
| Other assets |
156,287 | 156,287 | ||||||
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| Total assets |
$ | 63,530,417 | $ | 59,825,068 | ||||
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| Liabilities and Stockholders’ Equity |
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| Current liabilities: |
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| Accounts payable |
$ | 1,100,355 | $ | 928,095 | ||||
| Accrued compensation |
446,745 | 670,520 | ||||||
| Accrued expenses and other current liabilities |
1,113,685 | 1,383,833 | ||||||
| Income taxes payable |
230,133 | — | ||||||
| Operating lease obligation |
27,128 | 24,192 | ||||||
| Customer deposits |
7,799,815 | 5,098,633 | ||||||
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| Total current liabilities |
10,717,861 | 8,105,273 | ||||||
| Operating lease obligation, less current portion |
769,869 | 778,519 | ||||||
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| Total liabilities |
11,487,730 | 8,883,792 | ||||||
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| Commitments and contingencies |
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| Stockholders’ equity: |
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| Preferred stock, $.10 par value, 500,000 shares |
— | — | ||||||
| Common stock, $.10 par value, 10,000,000 shares authorized; 5,364,907 shares issued; 3,632,446 and 3,631,196 outstanding, respectively |
536,491 | 536,491 | ||||||
| Additional paid in capital |
10,717,025 | 10,694,554 | ||||||
| Retained earnings |
59,041,816 | 57,976,051 | ||||||
| Less treasury stock at cost, 1,732,461 shares in 2021 and 1,733,711 shares in 2020 |
(18,252,645 | ) | (18,265,820 | ) | ||||
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| Total stockholders’ equity |
52,042,687 | 50,941,276 | ||||||
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| Total liabilities and stockholders’ equity |
$ | 63,530,417 | $ | 59,825,068 | ||||
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NOBILITY HOMES, INC.
Condensed Consolidated Statements of Income
(Unaudited)
| Three Months Ended | ||||||||
| January 30, 2021 |
February 1, 2020 |
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| Net sales |
$ | 9,071,511 | $ | 9,443,852 | ||||
| Cost of sales |
(6,574,064 | ) | (6,554,003 | ) | ||||
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| Gross profit |
2,497,447 | 2,889,849 | ||||||
| Selling, general and administrative expenses |
(1,273,381 | ) | (1,256,144 | ) | ||||
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| Operating income |
1,224,066 | 1,633,705 | ||||||
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| Other income: |
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| Interest income |
30,656 | 101,883 | ||||||
| Undistributed earnings in joint venture— Majestic 21 |
13,708 | 19,872 | ||||||
| Proceeds received under escrow arrangement |
45,868 | 83,109 | ||||||
| Increase in fair value of equity investment |
79,956 | — | ||||||
| Miscellaneous |
7,320 | 7,152 | ||||||
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| Total other income |
177,508 | 212,016 | ||||||
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| Income before provision for income taxes |
1,401,574 | 1,845,721 | ||||||
| Income tax expense |
(335,809 | ) | (445,580 | ) | ||||
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| Net income |
1,065,765 | 1,400,141 | ||||||
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| Weighted average number of shares outstanding: |
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| Basic |
3,631,924 | 3,659,241 | ||||||
| Diluted |
3,633,493 | 3,660,638 | ||||||
| Net income per share: |
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| Basic |
$ | 0.29 | $ | 0.38 | ||||
| Diluted |
$ | 0.29 | $ | 0.38 | ||||