Note 7 - Unconsolidated Affiliated Companies

9 Months Ended

Aug. 25, 2012

Equity Method Investments and Joint Ventures Disclosure [Text Block]

7.    Unconsolidated Affiliated Companies

We own 49% of Zenith Freight Lines, LLC, (“Zenith”) which provides domestic transportation and warehousing services primarily to furniture manufacturers and distributors and also provides home delivery services to furniture retailers.  We have contracted with Zenith to provide for substantially all of our domestic freight, transportation and warehousing needs for the wholesale business.  In addition, Zenith provides home delivery services for several of our Company-owned retail stores.  Our investment in Zenith was $6,294 and $6,137 at August 25, 2012 and November 26, 2011, respectively. We recorded the following income from Zenith in other income (loss), net in our condensed consolidated statements of income and retained earnings:

	Quarter Ended					Nine Months Ended
	August 25, 2012		August 27, 2011			August 25, 2012		August 27, 2011
Income	$	23	$	(139	)	$	157	$	(48	)
Dividends received		-		-			-		-

Prior to May 2, 2011, we owned a 46.9% interest in International Home Furnishings Center, Inc (“IHFC”). On May 2, 2011, we sold our entire interest in IHFC, resulting in a one-time gain of $85,542 which was recognized during the second quarter of fiscal 2011 (see Note 16). IHFC owned and leased out floor space in a showroom facility in High Point, North Carolina. Prior to the sale of our investment in IHFC, we accounted for the investment using the equity method since we did not maintain operating control of IHFC.  We recorded income and received dividends from IHFC as follows:

	Quarter Ended				Nine Months Ended
	August 25, 2012		August 27, 2011		August 25, 2012		August 27, 2011
Income	$	-	$	-	$	-	$	1,832
Dividends received		-		-		-		3,756

The income is included in other income (loss), net in our condensed consolidated statements of income and retained earnings.

Summarized unaudited income statement information for IHFC for its first five months of fiscal 2011 up to the sale of our interest was as follows:

Revenue	$	15,875
Operating income		9,876
Net income		3,908

In connection with the sale of IHFC, we acquired a minority equity stake in the buyer, International Market Centers, L.P. (“IMC”), in exchange for $1,000. IMC is majority owned by funds managed by Bain Capital Partners and a subsidiary of certain investment funds managed by Oaktree Capital Management, L.P. Our investment in IMC is accounted for using the cost method as we do not have significant influence over IMC.