10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C., 20549

FORM 10-K

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended November 26, 2022

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to             

Commission File No. 000-00209

BASSETT FURNITURE INDUSTRIES, INCORPORATED

(Exact name of registrant as specified in its charter)

virginia	54-0135270
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

3525 FAIRYSTONE PARK HIGHWAY BASSETT, virginia	24055
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code 276/629-6000

Securities registered pursuant to Section 12(b) of the Act:

Title of each class:	Trading Symbol	Name of each exchange on which registered
Common Stock ($5.00 par value)	BSET	NASDAQ

Securities registered pursuant to Section 12(g) of the Act:          None

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act     ☐  Yes    ☒  No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ☐  Yes    ☒  No

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, and (2) has been subject to such filing requirements for at least the past 90 days.     ☒  Yes    ☐  No

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 during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒  Yes    ☐  No

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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	☐	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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued

its audit report.                                                                                                     ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12-b2 of the Exchange Act).    ☐  Yes    ☒  No

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant as of May 28, 2022 was $166,389,769.

The number of shares of the Registrant’s common stock outstanding on January 13, 2023 was 8,957,259.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Bassett Furniture Industries, Incorporated definitive Proxy Statement for its 2022 Annual Meeting of Stockholders to be held March 8, 2023, to be filed with the Securities and Exchange Commission pursuant to Regulation 14A under the Securities Exchange Act of 1934 (the “Proxy Statement”) are incorporated by reference into Part III of this Form 10-K.

TABLE OF CONTENTS

FORWARD-LOOKING STATEMENTS		1
PART I
Item 1.	Business	2
Item 1A.	Risk Factors	8
Item 1B.	Unresolved Staff Comments	11
Item 2.	Properties	11
Item 3.	Legal Proceedings	11
Item 4.	Mine Safety Disclosures	11
	Information about our Executive Officers	11
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	13
Item 6.	[Reserved]	13
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	26
Item 8.	Financial Statements and Supplementary Data	27
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	64
Item 9A.	Controls and Procedures	64
Item 9B.	Other Information	66
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	66
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	66
Item 11.	Executive Compensation	66
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	66
Item 13.	Certain Relationships and Related Transactions, and Director Independence	66
Item 14.	Principal Accountant Fees and Services	66
PART IV
Item 15.	Exhibits	67
Item 16.	Form 10-K Summary	68
SIGNATURES		69

As used herein, unless the context otherwise requires, “Bassett,” the “Company,” “we,” “us” and “our” refer to Bassett Furniture Industries, Incorporated and its subsidiaries. References to 2022, 2021 and 2020 mean the fiscal years ended November 26, 2022, November 27, 2021 and November 28, 2020. All three years contained 52 weeks.

SAFE-HARBOR, FORWARD-LOOKING STATEMENTS

This report contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations and business of Bassett Furniture Industries, Incorporated and subsidiaries. Such forward-looking statements are identified by use of forward-looking words such as “anticipates”, “believes”, “plans”, “estimates”, “expects”, “aimed” and “intends” or words or phrases of similar expression. These forward-looking statements involve certain risks and uncertainties. No assurance can be given that any such matters will be realized. Important factors, which should be read in conjunction with Item 1A “Risk Factors”, that could cause actual results to differ materially from those contemplated by such forward-looking statements include:

● fluctuations in the cost and availability of raw materials, fuel, labor, delivery costs and sourced products, including those which may result from supply chain disruptions and shortages and the imposition of new or increased duties, tariffs, retaliatory tariffs and trade limitations with respect to foreign-sourced products

● competitive conditions in the home furnishings industry

● overall retail traffic levels in stores and on the web and consumer demand for home furnishings

● ability of our customers and consumers to obtain credit

● the profitability of the stores (independent licensees and Company-owned retail stores) which may result in future store closings

● ability to implement our Company-owned retail strategies and realize the benefits from such strategies, including our initiatives to expand and improve our digital marketing and advertising capabilities, as they are implemented

● the risk that we may not achieve the strategic benefits of our acquisition of Noa Home Inc.

● effectiveness and security of our information technology systems and possible disruptions due to cybersecurity threats, including any impacts from a network security incident; and the sufficiency of our insurance coverage, including cybersecurity insurance

● future tax legislation, or regulatory or judicial positions

● ability to efficiently manage the import supply chain to minimize business interruption

● concentration of domestic manufacturing, particularly of upholstery products, and the resulting exposure to business interruption from accidents, weather and other events and circumstances beyond our control

● the impact of the COVID-19 pandemic and resulting supply chain disruptions upon our ability to maintain normal operations at our retail stores and manufacturing facilities, and the resulting effects any future interruption of those operations may have upon our financial condition, results of operations and liquidity, as well as the impact of the pandemic upon general economic conditions, including consumer spending and the strength of the housing market in the United States

You should keep in mind that any forward-looking statement made by us in this report speaks only as of the date on which such forward-looking statement is made. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. We have no duty to, and do not intend to, update or revise the forward-looking statements in this report after the date hereof, except as may be required by law. In light of these risks and uncertainties, you should keep in mind that the events described in any forward-looking statement made in this report, might not occur.

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PART I

ITEM 1. BUSINESS

(dollar amounts in thousands except per share data)

General

Bassett is a leading retailer, manufacturer and marketer of branded home furnishings. Our products are sold primarily through a network of Company-owned and licensee-owned branded stores under the Bassett Home Furnishings (“BHF”) name, with additional distribution through other wholesale channels including multi-line furniture stores, many of which feature Bassett galleries or design centers. We also sell our products through our website at www.bassettfurniture.com. We were founded in 1902 and incorporated under the laws of Virginia in 1930. Our rich 120-year history has instilled the principles of quality, value, and integrity in everything we do, while simultaneously providing us with the expertise to respond to ever-changing consumer tastes and meet the demands of a global economy.

With 91 BHF stores at November 26, 2022, we have leveraged our strong brand name in furniture into a network of Company-owned and licensed stores that focus on providing consumers with a friendly environment for buying furniture and accessories.  Our store program is designed to provide a single source home furnishings retail store that provides a unique combination of stylish, quality furniture and accessories with a high level of customer service.  In order to reach markets that cannot be effectively served by our retail store network, we also distribute our products, including the Lane Venture outdoor furniture products, through other wholesale channels including multi-line furniture stores, many of which feature Bassett galleries or design centers. We use a network of over 30 independent sales representatives who have stated geographical territories. These sales representatives are compensated based on a standard commission rate. We believe this blended strategy provides us the greatest ability to effectively distribute our products throughout the United States and ultimately gain market share.  

The BHF stores feature custom order furniture, free in-home and virtual design visits (“home makeovers”) and coordinated decorating accessories.  Our philosophy is based on building strong long-term relationships with each customer.  Sales people are referred to as “Design Consultants” and are trained to evaluate customer needs and provide comprehensive solutions for their home decor.  Until a rigorous training and design certification program is completed, Design Consultants are not authorized to perform in-home or virtual design services for our customers.

During the second quarter of fiscal 2022, we opened our first regional fulfillment center (“RFC”) in Orlando, Florida where we are stocking our best sellers for much quicker delivery. This adds an element of immediacy to our proven platform of made to order custom furniture that has driven our strategy for the past two decades. During the fourth quarter of 2022, we opened our second RFC near Baltimore, Maryland. In December of 2022, we opened three more RFCs in Conover, North Carolina, Grand Prairie, Texas and Riverside, California. We plan to evaluate the performance of these five RFCs before considering any additional locations.

In 2018, we added outdoor furniture to our offerings with the acquisition of the Lane Venture brand. Our strategy is to distribute these products outside of our BHF store network through a network of over 10 independent sales representatives. Using Lane Venture as a platform, we developed the Bassett Outdoor brand that is only marketed through the BHF store network. This allows Bassett branded product to move from inside the home to outside the home to capitalize on the growing trend of outdoor living.

We have factories in Newton, North Carolina that manufacture both stationary and motion upholstered furniture for inside the home along with our outdoor furniture offerings. We also have factories in Martinsville and Bassett, Virginia that assemble and finish our custom bedroom and dining offerings. Late in the third quarter of fiscal 2022, we purchased a facility which we had formerly leased in Haleyville, Alabama where we manufacture aluminum frames for our outdoor furniture. With the purchase, we also obtained two additional buildings which will allow us to expand our footprint at that facility. Our manufacturing team takes great pride in the breadth of its options, the precision of its craftsmanship, and the speed of its manufacturing process. In addition to the furniture that we manufacture domestically, we source most of our formal bedroom and dining room furniture (casegoods) and certain leather upholstery offerings from several foreign plants, primarily in Vietnam, Thailand and China. Over 75% of the products we currently sell are manufactured in the United States.

We consider our website to be the front door to our brand experience where customers can research our furniture and accessory offerings and subsequently buy online or engage with an in-store design consultant. Customer acquisition resulting from our digital outreach strategies has significantly increased our traffic to the website since 2019. The migration to digital brand research has caused us to comprehensively evaluate all of our American made custom products. While our Bench Made line of custom upholstery and custom bedroom and dining products continue to be our most successful offerings, most of these items must be purchased in a store as they are not conducive to web transactions due to the number of options available. Consequently, we will continue to methodically re-design each one of these important lines to best serve our customers online, in the store or wherever our customer might be. Our intent is to continue to offer the consumer custom options that will help them personalize their home but to do so in an edited fashion that will provide a better web experience in the research phase and will also allow the final purchase to be made either on the web or in the store. While we work to make it easier to purchase either in store or on-line, we will not compromise our in-store experience or the quality of our in-home makeover capabilities.

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We are engaged in a multi-year cross-functional digital transformation initiative with the first phase consisting of the examination and improvement of our underlying data management processes. During the second quarter of 2022, we implemented a comprehensive Product Information Management system which will allow us to enhance and standardize our product development and data management and governance processes. This will result in more consistent data that our merchandizing and sales teams can use in analyzing various product and sales trends in order to make better informed decisions. We are also in the process of implementing a new eCommerce platform that we plan to introduce in the second quarter of 2023.  The new web platform will leverage world class features including enhanced customer research capabilities and streamlined navigation that we believe will result in increased web traffic and sales.

During the fourth quarter of fiscal 2022 we acquired Noa Home Inc. (“Noa Home”), a mid-priced e-commerce furniture retailer headquartered in Montreal, Canada. Noa Home has operations in Canada, Australia, Singapore and the United Kingdom. With a lean staffing model, the Noa Home team has built an operational blueprint that has the potential for significant growth. We believe the acquisition will provide Bassett with a greater online presence and will allow us to attract more digitally native consumers. While still in the planning phase, we expect to introduce the Noa Home brand in the United States during 2023.

During the first quarter of 2022, we entered into a definitive agreement to sell substantially all of the assets of our wholly-owned subsidiary, Zenith Freight Lines, LLC (“Zenith”) to J.B. Hunt Transport Services, Inc. (“J.B. Hunt”), and the transaction was completed on February 28, 2022. As a result of the sale, the operations of our former logistical services segment, which consisted entirely of the operations of Zenith, are presented in this Annual Report on Form 10-K as discontinued operations.

Impact of the COVID-19 Pandemic and Related Supply Chain and Labor Issues Upon Our Business

On March 11, 2020, the World Health Organization declared the coronavirus (“COVID-19”) outbreak to be a global pandemic. In response to this declaration and the rapid spread of COVID-19 within the United States, federal, state and local governments throughout the country imposed varying degrees of restrictions on social and commercial activity to promote social distancing in an effort to slow the spread of the illness. These measures had a significant adverse impact upon many sectors of the economy, including non-essential retail commerce, beginning in our second fiscal quarter of 2020.

In response to the restrictive measures imposed by governmental authorities and for the protection of our employees and customers, we temporarily closed our dedicated stores, our manufacturing locations and many of our warehouses for much of the second fiscal quarter of 2020. This extended period of suspended operations had a material adverse impact upon our results of operations during the second fiscal quarter of 2020 and resulted in a significant net loss for 2020. In addition to operating losses resulting from severely reduced sales volumes, we also recorded charges for goodwill impairment as well as for the impairment of certain other long-lived assets. However, since restarting our manufacturing operations and reopening stores, we have seen a significant improvement in business conditions which allowed us to return to overall profitability for the third and fourth fiscal quarters of 2020 continuing through fiscal 2022. However, continuing logistical challenges faced by the entire home furnishings industry resulting from COVID-related labor shortages and supply chain disruptions created significant delays in order fulfillment and increasing backlogs as we were not able to produce and ship at the incoming rate of wholesale and retail orders. Gradual decreases in wholesale and retail backlogs over the course of 2022 were driven by a lower rate of incoming orders coupled with gradual easing of supply chain constraints. By the end of fiscal 2022, these issues have been substantially resolved. However, we cannot anticipate the impact of any future resurgence of COVID-19 upon our business, which could include, among other things, reductions in customer traffic to our retail stores, increased labor shortages and renewed supply chain disruptions. Should these conditions resume, this may have a material adverse impact on our ultimate financial condition and liquidity.

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Operating Segments

We have strategically aligned our business into two reportable segments: Wholesale and Retail – Company-owned stores.

The wholesale home furnishings segment is involved principally in the design, manufacture, sourcing, sale and distribution of furniture products to a network of BHF stores (Company-owned retail stores and licensee-owned stores) and independent furniture retailers. Our retail segment consists of 58 Company-owned and operated BHF stores. The following table shows the number of Company-owned stores by state as of November 26, 2022:

	Number of		Number of
State	Stores	State	Stores
Alabama	1	Nevada	1
Arizona	3	New Jersey	2
Arkansas	1	New York	5
California	2	North Carolina	5
Connecticut	3	Ohio	2
Delaware	1	Oklahoma	1
Florida	4	Pennsylvania	2
Georgia	3	South Carolina	1
Kentucky	1	Tennessee	1
Maryland	3	Texas	10
Massachusetts	1	Virginia	4
Missouri	1	Total	58

Our five locations in the state of New York include a 16,000 square foot clearance center in Middletown, New York. Unlike our other 57 BHF locations, the clearance center offers only clearance merchandise at reduced price points and without design consulting services.

Wholesale Segment Overview

The wholesale furniture industry is very competitive and there are a large number of manufacturers both within and outside the United States who compete in the market on the basis of product quality, price, style, delivery and service. Additionally, many retailers source imported product directly, thus bypassing domestic furniture manufacturers and wholesale importers. We believe that we can be successful in the current competitive environment because our products represent excellent value combining attractive prices, quality and styling, prompt delivery, and superior service.

Wholesale shipments by category for the last three fiscal years, excluding intercompany sales to our retail segment, are summarized below:

	2022								2021								2020
	External		Intercompany		Total				External		Intercompany		Total				External		Intercompany		Total
Bassett Custom Upholstery	$	124,565	$	82,437	$	207,002	63.8	%	$	105,445	$	69,533	$	174,978	59.2	%	$	71,840	$	56,360	$	128,200	58.0	%
Bassett Leather		35,953		76		36,029	11.1	%		36,157		61		36,218	12.3	%		20,487		949		21,436	9.7	%
Bassett Custom Wood		22,534		24,764		47,298	14.6	%		24,079		24,066		48,145	16.3	%		19,682		19,629		39,311	17.8	%
Bassett Casegoods		15,628		18,612		34,240	10.5	%		17,378		18,610		35,988	12.2	%		13,719		18,409		32,128	14.5	%
Total	$	198,680	$	125,889	$	324,569	100.0	%	$	183,059	$	112,270	$	295,329	100.0	%	$	125,728	$	95,347	$	221,075	100.0	%

Approximately 22% of our 2022 wholesale sales were of imported product compared to 24% in both 2021 and 2020. We define imported product as fully finished product that is sourced. Our domestic product includes certain products that contain components which were also sourced. We continue to believe that a blended strategy including domestically produced products primarily of a custom-order nature combined with sourcing of major collections provides the best value and quality of products to our customers.

The dollar value of our wholesale backlog, representing orders received but not yet shipped to the BHF store network or independent dealers, was $35,336 at November 26, 2022 and $90,057 at November 27, 2021. The significant reduction in backlog is due to a 15% decrease in incoming orders for 2022 coupled with the easing of COVID-related labor shortages and supply chain disruptions.

4

We use lumber, fabric, leather, foam and other materials in the production of wood and upholstered furniture. These components are purchased from a variety of domestic and international suppliers and are widely available. The price and availability of foam, which is highly dependent on the cost of oil and available capacity of oil refineries, can be subject to significant volatility from time to time.

Retail Segment Overview – Company-Owned Retail Stores

The retail furniture industry remains very competitive and includes local furniture stores, regional furniture retailers, national department and chain stores, single-vendor branded retailers and on-line retailers. As a whole, our store network with 58 Company-owned stores and 33 licensee-owned stores, ranks in the top 30 in retail furniture sales in the United States. Our Company-owned store network peaked at 70 stores in fiscal 2019. Since that time, we have closed ten underperforming locations along with two others that are in the process of relocation within their markets.

Net sales for our Company-owned retail stores by major product category for the last three fiscal years are summarized below:

	2022 (2)				2021				2020
Bassett Custom Upholstery	$	163,755	57.1	%	$	139,527	56.3	%	$	112,888	53.3	%
Bassett Leather		1,707	0.6	%		226	0.1	%		2,326	1.1	%
Bassett Custom Wood		43,208	15.1	%		30,931	12.5	%		28,942	13.7	%
Bassett Casegoods		40,146	14.0	%		42,658	17.2	%		35,728	16.9	%
Accessories, mattresses & other (1)		38,105	13.3	%		34,485	13.9	%		32,060	15.1	%
Total	$	286,921	100.0	%	$	247,827	100.0	%	$	211,944	100.0	%

(1) Includes sales of goods other than Bassett-branded products, such as accessories and bedding, and also includes the sale of furniture protection plans.

(2) Beginning with the fourth quarter of fiscal 2022, our retail segment includes the sales of Noa Home, which was acquired on September 2, 2022.

The COVID crisis in 2020 gave us the opportunity to look inward and to make structural improvements to our business model. We instituted a “virtual appointment” program for our stores in late March of 2020, whereby consumers digitally engage with our designers and transact without physically visiting a store. Adding this new form of engagement is one of the many lasting changes that have come out of the pandemic.

We consider our website to be the front door to our brand experience where customers can research our furniture and accessory offerings and subsequently buy online or engage with an in-store design consultant. Customer acquisition resulting from our digital outreach strategies has significantly increased our traffic to the website and our online orders. Digital advertising continued to dominate our marketing expenditures in 2022 as compared to traditional television and direct mail advertising. We plan to continue with increased levels of spending on digital advertising and outreach during 2023.

The migration to digital brand research has caused us to comprehensively evaluate all of our American made custom products. While our Bench Made line of custom upholstery and custom bedroom and dining products continue to be our most successful offerings, most of these items must be purchased in a store as they are not conducive to web transactions due to the number of options available. Consequently, we will continue to methodically re-design each one of these important lines. Our intent is to continue to offer the consumer custom options that will help them personalize their home but to do so in an edited fashion that will provide a better web experience in the research phase and will also allow the final purchase to be made either on the web or in the store. While we work to make it easier to purchase either in store or on-line, we will not compromise on our in-store experience or the quality of our in-home makeover capabilities.

We also continue to re-examine the performance of every one of our stores. Store traffic has been declining and the effect on our retail model has become increasingly challenging. We believe that on a market-by-market basis, there will be fewer stores in the future. We will continue to evaluate store-by-store performance as we seek the optimal store count in the markets in which we compete at retail.

We also plan to heavily emphasize our “Made in America” story and utilize locally harvested and organic materials when possible. As part of this, we recently rebranded our premier Custom Upholstery line to be part of the Bench Made program emphasizing that those products are artisan crafted with exceptional domestic materials and are made to order. In addition, we expanded our Bench Made solid wood dining offerings to provide a sleeker more contemporary styled product to complement our initial Bench Made dining offerings. 

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Trademarks

Our trademarks, including “Bassett” and the names of some of our marketing divisions, products and collections, are significant to the conduct of our business. This is important due to consumer recognition of the names and identification with our broad range of products. Certain of our trademarks are licensed to independent retailers for use in full store and store gallery presentations of our products. We also own copyrights that are important in the conduct of our business.

Government Regulations

We believe that we have materially complied with all federal, state and local standards regarding safety, health and pollution and environmental controls.

We may also be affected by laws and regulations of countries from which we source goods. Labor, environmental and other laws and regulations change over time, especially in the developing countries from which we source. Changes in these areas of regulation could negatively impact the cost and availability of sourced goods. The timing and extent to which these regulations could have an adverse effect on our financial position or results of operations is difficult to predict. In addition, the imposition of new or increased duties, tariffs, retaliatory tariffs and trade limitations with respect to foreign-sourced products could negatively impact the cost of such goods. Based on the present facts, we do not believe that they will have a material adverse effect on our financial position or future results of operations.

Human Capital

We employed 1,561 people as of November 26, 2022. Our associate count represents a decrease of 658 from a year ago, 644 due to the sale of Zenith with the remaining 14 primarily attributable to the reduction in the number of Company-owned retail stores. Headcount by segment is as follows:

● 1,037 in the wholesale segment

● 524 in the retail segment

Invested… In Each Other is more than a catchphrase at Bassett – it’s how we approach our relationships with our associates. When we invest in our team members’ personal wellbeing, work environment and professional development, we promote a work culture that fosters mutual respect, increased productivity, and best-in-class customer service.

Personal & Financial Wellbeing

● We offer a free online mental and behavioral health resource to all our associates, their spouses and adolescent children, with unlimited access to board-certified psychiatrists and licensed therapists.

● Our wellness programs, including onsite health clinics, personalized health coaching, mental health counseling, and incentivized healthy lifestyle choices, are designed to improve associate health and reduce healthcare costs for both the associate and the Company.

● We provide opportunities for our associates to meet with a certified financial planner for personalized retirement planning and budget counseling.

● We offer comprehensive benefit plans including Company subsidized health insurance, 401(k) Plan with Company matching contributions, and paid time off. We believe our benefit plans are competitive and meet the needs of most of our associates.

Work Environment

Our investments in our facilities continue, which improve our associates’ safety and comfort, and increase efficiency. These include:

● Updated break area, restrooms, lighting and parking at our Haleyville, Alabama manufacturing facility

● Improved lighting and flooring, and reconfigured layouts to facilitate more efficient and roomier work areas in our Newton, NC upholstery facilities.

● Invested in material handling solutions at our Bassett, VA plant, reducing the need for associates to physically move materials through the production process.

● Continued renovations at our corporate headquarters.

We continued to conduct associate focus groups to solicit input for further improving our associate’s work-life experience. Based on this feedback, we instituted a mentorship program to assist with new associate orientation at our Martinsville facility and started weekly department manager-led meetings with production personnel.

6

Professional Development

We offer opportunities to our associates for educational and skill development, including:

● Leadership, communication and diversity/inclusion training for identified high potential associates.

● Tuition reimbursement for associates who desire to further their education.

● Online training for managers, with classes completed monthly.

● Training for customer-facing associates designed to enhance the in-store and follow up experiences for our customers.

Discrimination and Harassment Policy

We continue to maintain and enforce our policy prohibiting discrimination and harassment in our workplace. Our managers are trained in how to prevent, recognize and respond to possible inappropriate behavior. Associates have several available avenues for reporting concerns, including a confidential hotline. We promptly and carefully investigate each complaint of harassment or discrimination.

Major Customers

Our risk exposure related to our customers, consisting primarily of trade accounts receivable along with certain guarantees, net of recognized reserves, totaled approximately $19,709 and $22,447 at November 26, 2022 and November 27, 2021, respectively. At November 26, 2022 and November 27, 2021, approximately 31% and 24%, respectively, of the aggregate risk exposure, net of reserves, was attributable to five customers. In fiscal 2022, 2021 and 2020, no customer accounted for more than 10% of total consolidated net sales.

Available Information

We file our annual, quarterly and current reports, proxy statements and other information with the SEC. Our SEC filings are available to the public at the SEC’s website at www.sec.gov.

Through our website, www.bassettfurniture.com, we make available free of charge as soon as reasonably practicable after electronically filing or furnishing with the SEC, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments thereto.

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ITEM 1A.         RISK FACTORS

The following risk factors should be read carefully in connection with evaluating our business and the forward-looking information contained in this Annual Report on Form 10-K. The risk factors below represent what we believe are the known material risk factors with respect to us and our business. Any of the following risks could materially adversely affect our business, operations, industry, financial position or future financial results.

Risks Related to the Coronavirus Pandemic

The coronavirus global pandemic which caused a significant disruption in non-essential retail commerce may continue to have a material adverse impact upon our financial condition and results of operations.

On March 11, 2020, the World Health Organization declared the current coronavirus (“COVID-19”) outbreak to be a global pandemic. In response to this declaration and the rapid spread of COVID-19 within the United States, federal, state and local governments throughout the country imposed varying degrees of restriction on social and commercial activity to promote social distancing in an effort to slow the spread of the illness. These measures had a significant adverse impact upon many sectors of the economy, including non-essential retail commerce. As a result of these circumstances, we temporarily closed our dedicated stores, our manufacturing locations and many of our warehouses. In addition, many of our office personnel were working remotely. By the end of June 2020, we had reopened all of our retail stores that had been temporarily closed. However, continuing logistical challenges faced by the entire home furnishings industry resulting from COVID-related labor shortages and supply chain disruptions created significant delays in order fulfillment and increasing backlogs as we were not able to produce and ship at the incoming rate of wholesale and retail orders. Gradual decreases in wholesale and retail backlogs over the course of 2022 were driven by a lower rate of incoming orders coupled with gradual easing of supply chain constraints. By the end of fiscal 2022, these issues have been substantially resolved. However, we cannot anticipate the impact of any future resurgence of COVID-19 upon our business, which could include, among other things, reductions in customer traffic to our retail stores, increased labor shortages and renewed supply chain disruptions. Should these conditions resume, this may have a material adverse impact on our ultimate financial condition and liquidity.

Risks Related to Our Retail Operations

We face a volatile retail environment and changing economic conditions that may further adversely affect consumer demand and spending.

Historically, the home furnishings industry has been subject to cyclical variations in the general economy and to uncertainty regarding future economic prospects. Should current economic conditions weaken, the current rate of housing starts decline, or rising inflation persist, consumer confidence and demand for home furnishings could deteriorate which could adversely affect our business through its impact on the performance of our Company-owned stores, as well as our licensees and the ability of a number of them to meet their obligations to us.

Our retail stores face significant competition from national, regional and local retailers of home furnishings, including increasing on-line competition via the internet.

The retail market for home furnishings is highly fragmented and intensely competitive. We currently compete against a diverse group of retailers, including national department stores, regional or independent specialty stores, and dedicated franchises of furniture manufacturers. National mass merchants such as Costco also have limited product offerings. We also compete with retailers that market products through store catalogs and the internet. In addition, there are few barriers to entry into our current and contemplated markets, and new competitors may enter our current or future markets at any time. We have also seen increasing competition from retailers offering consumers the ability to purchase home furnishings via the internet for home delivery, and this trend is expected to continue. Our existing competitors or new entrants into our industry may use a number of different strategies to compete against us, including aggressive advertising, pricing and marketing, extension of credit to customers on terms more favorable than we offer, and expansion into markets where we currently operate. Competition from any of these sources could cause us to lose market share, revenues and customers, increase expenditures or reduce prices, any of which could have a material adverse effect on our results of operations.

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Our licensee-owned stores may not be able to meet their obligations to us.

We have a significant amount of accounts receivable attributable to our network of licensee-owned stores. We also guarantee a limited number of leases of some of our licensees. If these stores do not generate the necessary level of sales and profits, the licensees may not be able to fulfill their obligations to us resulting in additional bad debt expenses and real estate related losses.

We may incur significant future losses due to our recent acquisition of Noa Home

If expected growth trends in Noa Home’s revenue fail to materialize, we may be unable to recover our investment in Noa Home, including any additional financial support we may find necessary to provide. This may result in significant operating losses from Noa Home which could have an adverse impact on our future cash flows and results of operations, including significant charges for the impairment of certain acquired assets including goodwill.

Risks Related to Our Brand and Product Offerings

Failure to successfully anticipate or respond to changes in consumer tastes and trends in a timely manner could adversely impact our business, operating results and financial condition.

Sales of our furniture are dependent upon consumer acceptance of our designs, styles, quality and price. As with all retailers, our business is susceptible to changes in consumer tastes and trends. We attempt to monitor changes in consumer tastes and home design trends through attendance at international industry events and fashion shows, internal marketing research, and communication with our retailers and design consultants who provide valuable input on consumer tendencies. However, such tastes and trends can change rapidly and any delay or failure to anticipate or respond to changing consumer tastes and trends in a timely manner could adversely impact our business, operating results and financial condition.

In addition, certain suppliers may require extensive advance notice of our requirements in order to produce products in the quantities we desire. This long lead time may require us to place orders far in advance of the time when certain products will be offered for sale, thereby exposing us to risks relating to shifts in consumer demand and trends, and any downturn in the U.S. economy.

Our success depends upon our brand, marketing and advertising efforts and pricing strategies, and if we are not able to maintain and enhance our brand, or if we are not successful in these efforts and strategies, our business and operating results could be adversely affected.

Maintaining and enhancing our brand is critical to our ability to expand our base of customers and drive increased traffic at both Company-owned and licensee-owned stores and to our website. Digital advertising and outreach continue to dominate our marketing expenditures. We are also investing heavily in our website and e-commerce. We plan to debut a new website in the second quarter of 2023 which will include improved navigation and on-line order capabilities designed to drive additional on-line sales. We cannot provide assurance that our marketing, advertising and other efforts to promote and maintain awareness of our brand will not require us to incur substantial costs. If these efforts are unsuccessful or we incur substantial costs in connection with these efforts, our business, operating results and financial condition could be adversely affected.

Risks Related to Material Sourcing and Supply

Our use of foreign sources of production for a portion of our products exposes us to certain additional risks associated with international operations.

Our use of foreign sources for the supply of certain of our products exposes us to risks associated with overseas sourcing.  These risks are related to government regulation, volatile ocean freight costs, delays in shipments, extended lead time in ordering and, more recently, disruptions in supply due to plant shut-downs and shipping delays resulting from surges in COVID infections in other parts of the world. Governments in the foreign countries where we source our products may change their laws, regulations and policies, including those related to tariffs and trade barriers, investments, taxation and exchange controls which could make it more difficult to service our customers resulting in an adverse effect on our earnings.

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Fluctuations in the price, availability and quality of raw materials could result in increased costs or cause production delays which might result in a decline in sales, either of which could adversely impact our earnings.

We use various types of wood, foam, fibers, fabrics, leathers, and other raw materials in manufacturing our furniture. Certain of our raw materials, including fabrics, are purchased both abroad and domestically. Fluctuations in the price, availability and quality of raw materials could result in increased costs or a delay in manufacturing our products, which in turn could result in a delay in delivering products to our customers. For example, lumber prices fluctuate over time based on factors such as weather and demand, which in turn impact availability. More recently, general price inflation brought on by labor and supply shortages have forced us to implement several general price increases in 2022 and 2021. There is no guarantee that we will be able to successfully pass along additional cost increases as they arise and rising inflation could have an adverse impact upon consumer demand for discretionary items such as home furnishings. Production delays or upward trends in raw material prices could result in lower sales or margins, thereby adversely impacting our earnings.

Risks Related to Electronic Data Processing and Digital Information

We rely extensively on computer systems to process transactions, summarize results and manage our business.  Disruptions in both our primary and back-up systems could adversely affect our business and operating results.

Our primary and back-up computer systems are subject to damage or interruption from power outages, computer and telecommunications failures, computer viruses, security breaches, natural disasters and errors by employees.  Though losses arising from some of these issues would be covered by insurance, interruptions of our critical business computer systems or failure of our back-up systems could reduce our sales or result in longer production times.  If our critical business computer systems or back-up systems are damaged or cease to function properly, we may have to make a significant investment to repair or replace them.

We may incur costs and reputational harm resulting from security risks we face in connection with our electronic processing, storage and transmission of confidential information.

We accept electronic payment cards in our stores and also gather certain personal identifiable information in the processing of our retail sales transactions. We also store and process confidential information pertaining to our employees and other third parties on our networks. We may in the future become subject to claims for purportedly fraudulent transactions arising out of the actual or alleged theft of credit or debit card information. In addition, if there were a disclosure of confidential information provided by, or concerning, our employees, customers or other third parties, including through inadvertent disclosure, unapproved dissemination, or unauthorized access, our reputation could be harmed, and we could be subject to civil or criminal liability and regulatory actions. Proceedings related to theft of credit or debit card information may be brought by payment card providers, banks and credit unions that issue cards, cardholders (either individually or as part of a class action lawsuit) and federal and state regulators. Any such proceedings could distract our management from running our business and cause us to incur significant unplanned losses and expenses. Consumer perception of our brand could also be negatively affected by these events, which could further adversely affect our results and prospects.

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ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

General

We own our corporate office building, which includes an annex, located in Bassett, Va.

We own the following facilities, by segment:

Wholesale Segment:

Facility	Location
Bassett Wood Division	Martinsville, Va.
Bassett Wood Division	Bassett, Va.
Bassett Upholstery Division	Newton, N.C.
Bassett Upholstery Division	Haleyville, Alabama
3 Warehouses	Bassett, Va.

In general, these facilities are suitable and are considered to be adequate for the continuing operations involved. All facilities are in regular use and provide adequate capacity for our manufacturing and warehousing needs. In addition to the owned properties shown above, we lease facilities in Newton, North Carolina for the manufacturing of upholstered furniture and the manufacturing and warehousing operations of Lane Venture and Bassett Outdoor.

Retail Segment:

Real estate associated with our retail segment consists of eight owned locations with an aggregate square footage of 203,465 and a net book value of $21,164. These stores are located as follows:

Concord, North Carolina	Greensboro, North Carolina
Greenville, South Carolina	Fredericksburg, Virginia
Houston, Texas	Louisville, Kentucky
Knoxville, Tennessee	Tampa, Florida (to be opened in 2023)

Of these locations, two are subject to land leases. Our remaining 51 store locations are leased from third parties. In addition to retail stores, we also lease thirteen locations for use as regional warehouses and home delivery distribution centers.

See Note 15 to the Consolidated Financial Statements included under Item 8 of this Annual Report for more information with respect to our operating lease obligations.

ITEM 3. LEGAL PROCEEDINGS

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

INFORMATION ABOUT OUR EXECUTIVE OFFICERS

David C. Baker, 62, joined the Company in 2005 as Director, Store Operations. From 2006 to 2015 he served as Vice President – Corporate Retail, and in 2015 was appointed to Senior Vice President, Corporate Retail. In 2019, he was appointed Senior Vice President, Chief Retail Officer. Prior to joining Bassett, Mr. Baker managed Bassett stores for licensees from 1999 to 2005 after having previously managed stores for other furniture retail chains including Haverty’s and Rhodes Furniture.

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John E. Bassett III, 64, has been with the Company since 1981 and served in various wood manufacturing and product sourcing capacities, including Vice President, Wood Manufacturing; Vice-President, Global Sourcing from 2001 to 2007 and Vice President, Wood in 2008. He was appointed Senior Vice President, Wood in 2009. In 2019, he was also promoted to the position of Senior Vice President, Chief Operations Officer.

Bruce R. Cohenour, 64, has been with the Company since 2011, starting as Senior Vice President of Upholstery Merchandising. In 2013, he was promoted to Senior Vice President of Sales and Merchandising. In 2019, he was appointed Senior Vice President, Chief Sales Officer. Prior to joining Bassett, Mr. Cohenour was with Hooker Furniture Corp. from 2007 through 2010, last serving as President of the Case Goods Division.

J. Michael Daniel, 61, joined the Company in 2007 as Corporate Controller. From April 2009 through December 2009, he served as Corporate Controller and Interim Chief Financial Officer. In January 2010, he was appointed Vice President and Chief Accounting Officer. In January 2013, he was promoted to Senior Vice President and Chief Financial Officer. In 2019, he was also promoted to the position of Senior Vice President, Chief Financial and Administrative Officer.

Jay R. Hervey, Esq., 63, has served as the General Counsel, Vice President and Secretary for the Company since 1997.

Kara Kelchner-Strong, 48, joined the Company in 2007 as Director, Retail Communications. In 2015, she was promoted to Vice President, Strategy and Planning. In 2018, she was appointed Vice President, Strategic Transformation Officer and in 2019, she was promoted to Senior Vice President, Customer Experience Officer. Prior to joining Bassett, she held several positions with Restoration Hardware.

Robert H. Spilman, Jr., 66, has been with the Company since 1984. Since 2000, he has served as Chief Executive Officer and President, and in 2016 also became the Chairman of the Board of Directors.

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information:

Bassett’s common stock trades on the NASDAQ global select market system under the symbol “BSET.” We had approximately 6,600 beneficial stockholders at January 13, 2023.

Issuer Purchases of Equity Securities: 

We are authorized to repurchase Company stock under a plan which was originally announced in 1998. On March 9, 2022, the Board of Directors increased the remaining limit of the repurchase plan to $40,000. The repurchase program does not include a specific timetable or price targets and may be suspended or terminated at any time. Shares may be purchased through open market or privately negotiated transactions at the discretion of management based on its evaluation of prevailing market conditions and other factors. The following table summarizes the stock repurchase activity for the three months ended November 26, 2022, and the approximate dollar value of shares that may yet be repurchased pursuant to our stock repurchase program:

Issuer Purchases of Equity Securities

(dollar amounts in thousands, except share and per share data)

	Total Shares Purchased		Average Price Paid		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
August 28 - October 1, 2022		76,000	$	17.82		76,000	$	29,503
October 2 - October 29, 2022		124,678	$	16.99		123,453	$	27,404
October 30 - November 26, 2022		74,703	$	18.80		74,703	$	25,999

ITEM 6.         [RESERVED]

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Amounts in thousands except share and per share data)

Impact of COVID-19

For a discussion of how COVID-19 has impacted and may continue to impact our business and financial condition, please refer to the discussion under the heading "Impact of the COVID-19 Pandemic and Related Supply Chain and Labor Issues Upon Our Business" in Part I, Item 1 of this report.

Overview

Bassett is a leading retailer, manufacturer and marketer of branded home furnishings. Our products are sold primarily through a network of Company-owned and licensee-owned branded stores under the Bassett Home Furnishings (“BHF”) name, with additional distribution through other wholesale channels including multi-line furniture stores, many of which feature Bassett galleries or design centers. We also sell our products through our website at www.bassettfurniture.com. We were founded in 1902 and incorporated under the laws of Virginia in 1930. Our rich 120-year history has instilled the principles of quality, value, and integrity in everything we do, while simultaneously providing us with the expertise to respond to ever-changing consumer tastes and meet the demands of a global economy.

With 91 BHF stores at November 26, 2022, we have leveraged our strong brand name in furniture into a network of Company-owned and licensed stores that focus on providing consumers with a friendly and casual environment for buying furniture and accessories.  Our store program is designed to provide a single source home furnishings retail store that provides a unique combination of stylish, quality furniture and accessories with a high level of customer service.  In order for the Bassett brand to reach markets that cannot be effectively served by our retail store network, we also distribute our products through other wholesale channels including multi-line furniture stores, many of which feature Bassett galleries or design centers. We use a network of over 30 independent sales representatives who have stated geographical territories. These sales representatives are compensated based on a standard commission rate. We believe this blended strategy provides us the greatest ability to effectively distribute our products throughout the United States and ultimately gain market share.  

The BHF stores feature custom order furniture, free in-home or virtual design visits (“home makeovers”) and coordinated decorating accessories.  Our philosophy is based on building strong long-term relationships with each customer.  Sales people are referred to as “Design Consultants” and are trained to evaluate customer needs and provide comprehensive solutions for their home decor.  Until a rigorous training and design certification program is completed, Design Consultants are not authorized to perform in-home or virtual design services for our customers.

During the second quarter of fiscal 2022, we opened our first regional fulfillment center (“RFC”) in Orlando, Florida where we are stocking our best sellers for much quicker delivery. This adds an element of immediacy to our proven platform of made to order custom furniture that has driven our strategy for the past two decades. During the fourth quarter of 2022, we opened our second RFC near Baltimore, Maryland. In December of 2022, we opened three more RFCs in Conover, North Carolina, Grand Prairie, Texas and Riverside, California. We plan to evaluate the performance of these five RFCs before considering any additional locations.

In 2018, we added outdoor furniture to our offerings with the acquisition of the Lane Venture brand. Our strategy is to distribute these products outside of our BHF store network through a network of over 10 independent sales representatives. Using Lane Venture as a platform, we developed the Bassett Outdoor brand that is only marketed through the BHF store network. This allows Bassett branded product to move from inside the home to outside the home to capitalize on the growing trend of outdoor living.

We have factories in Newton, North Carolina that manufacture both stationary and motion upholstered furniture for inside the home along with our outdoor furniture offerings. We also have factories in Martinsville and Bassett, Virginia that assemble and finish our custom bedroom and dining offerings. Late in the third quarter of fiscal 2022, we purchased a facility which we had formerly leased in Haleyville, Alabama where we manufacture aluminum frames for our outdoor furniture. With the purchase, we also obtained two additional buildings which will allow us to expand our footprint at that facility. Our manufacturing team takes great pride in the breadth of its options, the precision of its craftsmanship, and the speed of its manufacturing process.

In addition to the furniture that we manufacture domestically, we source most of our formal bedroom and dining room furniture (casegoods) and certain leather upholstery offerings from several foreign plants, primarily in Vietnam, Thailand and China. Over 75% of the products we currently sell are manufactured in the United States.

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We consider our website to be the front door to our brand experience where customers can research our furniture and accessory offerings and subsequently buy online or engage with an in-store design consultant. Customer acquisition resulting from our digital outreach strategies has significantly increased our traffic to the website since 2019. The migration to digital brand research has caused us to comprehensively evaluate all of our American made custom products. While our Bench Made line of custom upholstery and custom bedroom and dining products continue to be our most successful offerings, most of these items must be purchased in a store as they are not conducive to web transactions due to the number of options available. Consequently, we will continue to methodically re-design each one of these important lines to best serve our customers online, in the store or wherever our customer might be. Our intent is to continue to offer the consumer custom options that will help them personalize their home but to do so in an edited fashion that will provide a better web experience in the research phase and will also allow the final purchase to be made either on the web or in the store. While we work to make it easier to purchase either in store or on-line, we will not compromise our in-store experience or the quality of our in-home makeover capabilities.

We are engaged in a multi-year cross-functional digital transformation initiative with the first phase consisting of the examination and improvement of our underlying data management processes. During the second quarter of 2022, we implemented a comprehensive Product Information Management system which will allow us to enhance and standardize our product development and data management and governance processes. This will result in more consistent data that our merchandizing and sales teams can use in analyzing various product and sales trends in order to make better informed decisions. We are also in the process of implementing a new eCommerce platform that we plan to introduce in the second quarter of 2023.  The new web platform will leverage world class features including enhanced customer research capabilities and streamlined navigation that we believe will result in increased web traffic and sales. We expect to spend approximately $2,000 on these efforts in 2023.

During the fourth quarter of fiscal 2022 we acquired Noa Home for $5,878 cash plus contingent consideration of $1,375 (see Note 3 to the Consolidated Financial Statements for additional information regarding the acquisition). A mid-priced e-commerce furniture retailer headquartered in Montreal, Canada, Noa Home has operations in Canada, Australia, Singapore and the United Kingdom. With a lean staffing model, the Noa Home team has built an operational blueprint that has the potential for significant growth. We believe the acquisition will provide Bassett with a greater online presence and will allow us to attract more digitally native consumers. While still in the planning phase, we expect to introduce the Noa Home brand in the United States during 2023.

Company-owned Retail Stores

As we continually monitor the performance of our Company-owned retail store locations, we may occasionally determine that it is necessary to close underperforming stores in certain markets. During the first quarter of fiscal 2022 we closed one retail store in Ontario, California, and we closed our store in Wichita, Kansas, during the third quarter of fiscal 2022. During the fourth quarter of fiscal 2022 we closed our store in Farmingdale, New York and consolidated its operations with our existing store in nearby Westbury, New York. All of the above-mentioned closures occurred at or near the lease expirations.

During the second quarter of 2022, we acquired a 25,000 square foot store property in Tampa, Florida for $7,668. We are currently in the process of developing plans for store buildout and upfit with a planned opening date in the third quarter of 2023.

We also may occasionally identify opportunities to enhance our presence in existing markets by relocating existing stores to better locations within the same market. During the third quarter of fiscal 2022 we sold the store property of one of our Houston, Texas locations for $8,217, net of closing costs, which resulted in a gain of $4,595. For tax purposes, the sale of the Houston store and the purchase of the Tampa store will be treated as a 1031 exchange where the majority of the tax on the gain will be deferred. The store closure sale was completed early in the fourth quarter of fiscal 2022. We expect to open a new leased store in a more upscale shopping area in the vicinity of the closed store in the third quarter of 2023. During the fourth quarter of fiscal 2022 at the end of the lease term, we closed our Dallas, Texas store located at the intersection of McKinney and Knox streets. We plan to open a replacement store in the nearby iconic Inwood Village shopping center during the first quarter of 2023.

As of November 26, 2022, we had 58 Corporate-owned stores operating.

Sale of the Assets of Zenith Freight Lines, LLC

During the first quarter of 2022, we entered into a definitive agreement to sell substantially all of the assets of our wholly-owned subsidiary, Zenith, to J,J.B. Hunt for $86,939 in cash. On February 28, 2022 the transaction was completed with us receiving $85,521 after the payment of $418 in certain transaction costs and the funding of $1,000 held in escrow. The final purchase price was subject to a customary post-closing working capital adjustment, which was settled in the amount of $987 resulting in a pre-tax gain of $52,534 on this transaction. As a result of the sale, the operations of our former logistical services segment, which consisted entirely of the operations of Zenith, are presented in the accompanying condensed consolidated statements of income and in the following discussion as discontinued operations.

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Analysis of Continuing Operations

The following discussion provides an analysis of our results of operations and reasons for material changes therein for fiscal year 2022 as compared to fiscal year 2021. For an analysis of the fiscal year 2021 results as compared to fiscal year 2020, see “Analysis of Operations” in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s 2021 Annual Report on Form 10-K, filed with the SEC on January 31, 2022.

Net sales revenue, cost of furniture and accessories sold, selling, general and administrative (“SG&A”) expense, gain on sale of real estate, other charges, and income from operations were as follows for the years ended November 26, 2022, November 27, 2021 and November 28, 2020:

														Comparative Change
														2022 vs 2022					2021 vs 2020
	2022				2021				2020					Dollars		Percent			Dollars			Percent
Net sales of furniture and accessories	$	485,601	100.0	%	$	430,886	100.0	%	$	337,672		100.0	%	$	54,715		12.7	%	$	93,214			27.6	%
Cost of furniture and accessories sold		237,262	48.9	%		209,799	48.7	%		163,567		48.4	%		27,463		13.1	%		46,232			28.3	%
Gross profit		248,339	51.1	%		221,087	51.3	%		174,105		51.6	%		27,252		12.3	%		46,982			27.0	%
SG&A		218,069	44.9	%		196,830	45.7	%		176,405		52.2	%		21,239		10.8	%		20,425			11.6	%
Gain on sale of real estate		4,595	0.9	%		-	0.0	%		-		0.0	%		4,595		NM			-			NM
Asset impairments & other charges		-	0.0	%		-	0.0	%		15,205		4.5	%		-		NM			(15,205	)		-100.0	%
Income (loss) from continuing operations	$	34,865	7.2	%	$	24,257	5.6	%	$	(17,505	)	-5.2	%	$	10,608	N/M			$	41,762		N/M

Our consolidated net sales by segment were as follows:

										Comparative Change
										2022 vs 2021						2021 vs 2020
	2022			2021			2020			Dollars			Percent			Dollars			Percent
Sales Revenue
Wholesale sales of furniture and accessories	$	324,569		$	295,329		$	221,075		$	29,240			9.9	%	$	74,254			33.6	%
Less: Sales to retail segment		(125,889	)		(112,270	)		(95,347	)		(13,619	)		12.1	%		(16,923	)		17.7	%
Wholesale sales to external customers		198,680			183,059			125,728			15,621			8.5	%		57,331			45.6	%
Retail sales of furniture and accessories		286,921			247,827			211,944			39,094			15.8	%		35,883			16.9	%
Consolidated net sales of furniture and accessories	$	485,601		$	430,886		$	337,672		$	54,715			12.7	%	$	93,214			27.6	%

Total sales revenue for the year ended November 26, 2022, increased $54,715 or approximately 13% from the prior year period primarily due to increases in wholesale shipments to both the open market and the BHF store network, along with an approximately 16% increase in retail sales.

Gross margins for the year ended November 26, 2022, decreased 20 basis points from 2021 primarily due to rising raw material and inbound freight costs, including the impact of rising fuel prices, partially offset by greater fixed cost leverage from increased sales. While these rising costs have been somewhat mitigated by price increases implemented since the first quarter of 2021, the increase in order backlogs and order fulfillment times limited our ability to match revised pricing to manufacturing costs. Although no increases are currently being contemplated, we will continue to monitor our costs to determine if additional increases are warranted. SG&A expenses as a percentage of sales for year ended November 26, 2022, decreased 80 basis points from 2021 primarily due to improved leverage of fixed costs through higher sales levels.

During fiscal 2022, we also recognized a gain of $4,595 from the sale of the real estate at a former retail location in Houston, Texas.

Certain other items affecting comparability between fiscal 2022 and 2021 are discussed below in “Other Items Affecting Net Income”.

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Segment Information

We have strategically aligned our business into two reportable segments as defined in ASC 280, Segment Reporting, and as described below:

● Wholesale. The wholesale home furnishings segment is involved principally in the design, manufacture, sourcing, sale and distribution of furniture products to a network of Bassett stores (Company-owned and licensee-owned stores retail stores) and independent furniture retailers. Our wholesale segment includes our wood and upholstery operations as well as all corporate selling, general and administrative expenses, including those corporate expenses related to both Company- and licensee-owned stores. Our wholesale segment also includes our holdings of short-term investments and retail real estate previously leased as licensee stores. The earnings and costs associated with these assets are included in other loss, net, in our consolidated statements of operations.

● Retail – Company-owned stores. Our retail segment consists of Company-owned stores and includes the revenues, expenses, assets and liabilities and capital expenditures directly related to these stores and the Company-owned distribution network utilized to deliver products to our retail customers. The retail segment also includes the operations and net assets of Noa Home since the acquisition on September 2, 2022.

Our former logistical services segment which represented the operations of Zenith is now presented as a discontinued operation.

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Reconciliation of Segment Results to Consolidated Results of Operations

To supplement the financial measures prepared in accordance with GAAP, we present gross profit by segment inclusive of the effects of intercompany sales by our wholesale segment to our retail segment. Because these intercompany transactions are not eliminated from our segment presentations and because we do not present gross profit as a measure of segment profitability in the accompanying condensed consolidated financial statements, the presentation of gross profit by segment is considered to be a non-GAAP financial measure. In addition, certain special gains or charges that are included in consolidated income from operations are not included in the measures of segment profitability. The reconciliation of this non-GAAP financial measure to the most directly comparable financial measure calculated and presented in accordance with GAAP is presented below along with the effects of various other intercompany eliminations on our consolidated results of operations.

	Year Ended November 26, 2022
												GAAP
	Non-GAAP Presentation								Special			Presentation
	Wholesale		Retail		Eliminations				Items			Consolidated
Net sales of furniture and accessories	$	324,569	$	286,921	$	(125,889	)	(1)	$	-		$	485,601
Cost of furniture and accessories sold		225,455		135,930		(124,123	)	(2)		-			237,262
Gross profit		99,114		150,991		(1,766	)	(3)		-			248,339
SG&A expense		89,828		129,483		(1,242	)	(4)		-			218,069
Gain on sale of real estate		-		-		-				4,595	(5)		4,595
Income from continuing operations	$	9,286	$	21,508	$	(524	)		$	4,595		$	34,865

	Year Ended November 27, 2021
											GAAP
	Non-GAAP Presentation								Special		Presentation
	Wholesale		Retail		Eliminations				Items		Consolidated
Net sales of furniture and accessories	$	295,329	$	247,827	$	(112,270	)	(1)	$	-	$	430,886
Cost of furniture and accessories sold		202,026		118,455		(110,682	)	(2)		-		209,799
Gross profit		93,303		129,372		(1,588	)	(3)		-		221,087
SG&A expense		75,813		122,328		(1,311	)	(4)		-		196,830
Income from continuing operations	$	17,490	$	7,044	$	(277	)		$	-	$	24,257

	Year Ended November 28, 2020
													GAAP
	Non-GAAP Presentation									Special			Presentation
	Wholesale		Retail			Eliminations				Items			Consolidated
Net sales of furniture and accessories	$	221,075	$	211,944		$	(95,347	)	(1)	$	-		$	337,672
Cost of furniture and accessories sold		152,982		107,233			(96,648	)	(2)		-			163,567
Gross profit		68,093		104,711			1,301		(3)		-			174,105
SG&A expense		63,506		114,208			(1,309	)	(4)		-			176,405
Asset impairment charges		-		-			-				12,184	(6)		12,184
Goodwill impairment charge		-		-			-				1,971	(7)		1,971
Litigation expense		-		-			-				1,050	(8)		1,050
Income (loss) from continuing operations	$	4,587	$	(9,497	)	$	2,610			$	15,205		$	(17,505	)

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Notes to Segment Consolidation Table:

(1) Represents the elimination of sales from our wholesale segment to our Company-owned BHF stores.

(2) Represents the elimination of purchases by our Company-owned BHF stores from our wholesale segment. 

(3) Represents the change in the elimination of intercompany profit in inventory.

(4) Represents the elimination of rent paid by our retail stores occupying Company-owned real estate.

(5) Represents the gain  on the sale of the real estate at a former retail location.

(6) Represents $11,114 of non-cash asset impairment charges on underperforming stores, including $6,239 for the impairment of operating lease right-of-use assets, and $1,070 of non-cash impairment charges in our wholesale segment, primarily due to the closure of our custom upholstery manufacturing facility in Grand Prairie, Texas.

(7) Represents a non-cash charge for the impairment of goodwill associated with our retail reporting unit.

(8) Represents an accrual of $1,050 for estimated costs to resolve certain wage and hour violation claims that had been asserted against the Company

Wholesale Segment

Net sales, gross profit, SG&A expense and operating income for our Wholesale Segment were as follows for the fiscal years ended November 26, 2022, November 27, 2021 and November 28, 2020:

													Comparative Change
													2022 vs 2021					2021 vs 2020
	2022				2021				2020				Dollars			Percent		Dollars		Percent
Net sales	$	324,569	100.0	%	$	295,329	100.0	%	$	221,075	100.0	%	$	29,240		9.9	%	$	74,254	33.6	%
Gross profit (1)		99,114	30.5	%		93,303	31.6	%		68,093	30.8	%		5,811		6.2	%		25,210	37.0	%
SG&A		89,828	27.7	%		75,813	25.7	%		63,506	28.7	%		14,015		18.5	%		12,307	19.4	%
Income from operations	$	9,286	2.9	%	$	17,490	5.9	%	$	4,587	2.1	%	$	(8,204	)	-46.9	%	$	12,903	281.3	%

(1) Gross profit at the segment level is considered a Non-GAAP financial measure due to the included effects of intercompany transactions. Refer to the reconciliation of segment results to consolidated results of operations presented above.

Wholesale shipments by category for the fiscal years ended November 26, 2022, November 27, 2021 and November 28, 2020 are summarized below:

	2022								2021								2020
	External		Intercompany		Total				External		Intercompany		Total				External		Intercompany		Total
Bassett Custom Upholstery	$	124,565	$	82,437	$	207,002	63.8	%	$	105,445	$	69,533	$	174,978	59.2	%	$	71,840	$	56,360	$	128,200	58.0	%
Bassett Leather		35,953		76		36,029	11.1	%		36,157		61		36,218	12.3	%		20,487		949		21,436	9.7	%
Bassett Custom Wood		22,534		24,764		47,298	14.6	%		24,079		24,066		48,145	16.3	%		19,682		19,629		39,311	17.8	%
Bassett Casegoods		15,628		18,612		34,240	10.5	%		17,378		18,610		35,988	12.2	%		13,719		18,409		32,128	14.5	%
Total	$	198,680	$	125,889	$	324,569	100.0	%	$	183,059	$	112,270	$	295,329	100.0	%	$	125,728	$	95,347	$	221,075	100.0	%

Fiscal 2022 as Compared to Fiscal 2021

Net sales for the year ended November 26, 2022 increased $29,240 or 9.9% from the prior year period due to a 13% increase in shipments to both the BHF store network, a 32% increase in shipments of Lane Venture product and a 3.8% increase in shipments to the open market. Gross margins for the year ended November 26, 2022 declined 110 basis points compared to the prior year period as we experienced significant increases in material and other production costs. In addition, we experienced reduced margins in our Bassett Leather product line due to price discounting during the last half of the year. As this product line is internationally sourced with extended lead times, we received significant amounts of inventory during the second and third quarters of 2022 just as product demand was weakening due to the market downturn in home furnishings. Also, the ocean freight costs associated with the majority of the product received was at significantly higher costs than are currently being realized on current product receipts. Although we have reduced the inventory level by $5,320 since the peak, we still have $16,773 in inventory at November 26, 2022. We expect reduced margins on this product line to continue over the next two quarters as we reduce the inventory to a more normal level. All of these cost increases were partially offset by greater leverage of fixed costs due to higher sales volumes. SG&A expenses as a percentage of sales increased 200 basis points primarily due to increased sales and marketing expenses, employee compensation costs and logistics and warehouse costs partially offset by greater leverage of fixed costs from increased sales volumes.

19

Wholesale backlog decreased to $35,336 at November 26, 2022 from $90,057 at November 27, 2021 as a 15% decrease in incoming orders combined with the easing of COVID-related labor shortages and supply chain disruptions has enabled us to work down our Company record level backlog from 2021.

Retail Segment – Company Owned Stores

Net sales, gross profit, SG&A expense, and operating income (loss) for our retail segment were as follows for the fiscal years ended November 26, 2022, November 27, 2021 and November 28, 2020:

														Comparative Change
														2022 vs 2021				2021 vs 2020
	2022				2021				2020					Dollars		Percent		Dollars		Percent
Net sales	$	286,921	100.0	%	$	247,827	100.0	%	$	211,944		100.0	%	$	39,094	15.8	%	$	35,883	16.9	%
Gross profit (1)		150,991	52.6	%		129,372	52.2	%		104,711		49.4	%		21,619	16.7	%		24,661	23.6	%
SG&A		129,483	45.1	%		122,328	49.4	%		114,208		53.9	%		7,155	5.8	%		8,120	7.1	%
Income (loss) from operations	$	21,508	7.5	%	$	7,044	2.8	%	$	(9,497	)	-4.5	%	$	14,464	205.3	%	$	16,541	NM

(1) Gross profit at the segment level is considered a Non-GAAP financial measure due to the included effects of intercompany transactions. Refer to the reconciliation of segment results to consolidated results of operations presented above.

Retail sales by major product category for the fiscal years ended November 26, 2022, November 27, 2021 and November 28, 2020 were as follows:

	2022 (2)				2021				2020
Bassett Custom Upholstery	$	163,755	57.1	%	$	139,527	56.3	%	$	112,888	53.3	%
Bassett Leather		1,707	0.6	%		226	0.1	%		2,326	1.1	%
Bassett Custom Wood		43,208	15.1	%		30,931	12.5	%		28,942	13.7	%
Bassett Casegoods		40,146	14.0	%		42,658	17.2	%		35,728	16.9	%
Accessories, mattresses & other (1)		38,105	13.3	%		34,485	13.9	%		32,060	15.1	%
Total	$	286,921	100.0	%	$	247,827	100.0	%	$	211,944	100.0	%

(1) Includes the sale of goods other than Bassett-branded products, such as accessories and bedding, and also includes the sale of furniture protection plans.

(2) Beginning with the fourth quarter of fiscal 2022, our retail segment includes the sales of Noa Home, which was acquired on September 2, 2022.

Fiscal 2022 as Compared to Fiscal 2021

Net sales for the year ended November 26, 2022 increased $39,094 or approximately 16% from the prior year. Written sales (the value of sales orders taken but not delivered) declined 7.4% from fiscal 2021. Gross margins for the year ended November 26, 2022 increased by 40 basis points as compared to the prior year period, primarily driven by improved pricing strategies and lower levels of promotional activity, partially offset by increased clearance activity from five store closing events during the year. Selling, general and administrative expenses for the year ended November 26, 2022 as a percentage of sales decreased by 430 basis points as compared to fiscal 2021 primarily due to greater leverage of fixed costs from higher sales volumes. Sales and results of operations of Noa Home, which has been included in our retail segment since its acquisition on September 2, 2022, were not material.

Retail backlog decreased to $51,041 at November 26, 2022 from $82,894 at November 27, 2021 as the slower pace of written sales in the current year combined with the easing of COVID-related labor shortages and supply chain disruptions has enabled us to work down our Company record level backlog from 2021.

20

Discontinued Operations - Logistical Services

Revenues, operating expenses and income from operations for our logistical services segment were as follows for the fiscal years ended November 26, 2022, November 27, 2021 and November 28, 2020:

																Comparative Change
																2022 vs 2021					2021 vs 2020
	2022					2021					2020					Dollars			Percent		Dollars			Percent
Logistical services revenue	$	16,776		100.0	%	$	55,648		100.0	%	$	48,191		100.0	%	$	(38,872	)	-69.9	%	$	7,457		15.5	%
Cost of logistical services		15,001		89.4	%		53,905		96.9	%		46,910		97.3	%		(38,904	)	-72.2	%		6,995		14.9	%
Other loss, net		(63	)	-0.4	%		(260	)	-0.5	%		(54	)	-0.1	%		197		-75.8	%		(206	)	381.5	%
Income from discontinued operations	$	1,712		10.2	%	$	1,483		2.7	%	$	1,227		2.5	%	$	229		15.4	%	$	256		20.9	%

*53 weeks for fiscal 2019 as compared with 52 weeks for fiscal 2020.

Analysis of Discontinued Operations – Logistical Services

The amounts shown above represent the results of Zenith’s business transactions with third parties. Because the sale of Zenith was closed on the first business day of the second fiscal quarter of 2022, operating results for that period are insignificant.

Zenith also charged Bassett $9,121 for logistical services provided to our wholesale segment during the year ended November 26, 2022, and $31,329 and $26,967 for fiscal 2021 and 2020, respectively. These shipping and handling costs are included in selling, general and administrative expenses in the accompanying condensed consolidated statements of income. We have entered into a service agreement with J.B. Hunt for the continuation of these services for a period of seven years following the sale of Zenith. Subsequent to the sale, we have incurred $27,604 of expense during the year ended November 26, 2022, for the performance of logistical services by J.B. Hunt.

Other Items Affecting Net Income (Loss)

Other items affecting net income (loss) for fiscal 2022 and 2021 are as follows:

	2022			2021
Interest income (1)	$	302		$	48
Interest expense (2)		(38	)		(33	)
Net periodic pension costs (3)		(489	)		(422	)
Net gains (cost) of company-owned life insurance (4)		161			(364	)
Other		(739	)		(729	)
Total other loss, net	$	(803	)	$	(1,500	)

(1) Consists of interest income arising from our short-term investments and interest-bearing cash equivalents. The increase in interest income for fiscal 2022 as compared with fiscal 2021 was due primarily to higher interest rates paid on certificates of deposit. See Note 4 to the Consolidated Financial Statements for additional information regarding our investments in certificates of deposit.

(2) The interest expense in fiscal 2022 and 2021 is attributable to finance leases for computer and office equipment. See Note 15 to the Consolidated Financial Statements for additional information regarding our leases.

(3) Represents the portion of net periodic pension costs not included in income from operations. See Note 10 to the Consolidated Financial Statements for additional information related to our defined benefit pension plans.

(4) Includes a gain arising from death benefits from Company-owned life insurance of $1,441 in fiscal 2022.

21

Provision for Income taxes

On March 27, 2020 the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was signed into law. A major provision of the CARES Act allows net operating losses from the 2018, 2019 and 2020 tax years to be carried back up to five years. As a result, for the year ended November 28, 2020, we were able to recognize tax benefits substantially in excess of the current federal statutory rate of 21% due to the effects of carrying back our current net operating loss to tax years in which the federal statutory rate was 35%.

We recorded an income tax provision (benefit) on pre-tax income from continuing operations of $8,702, $5,836 and ($6,536) in fiscal 2022, 2021 and 2020, respectively. Our effective tax rates for both 2022 and 2021 of 25.5% differ from the federal statutory rate of 21.0% due to the effects of state income taxes and various permanent differences. Our effective tax rate of 36.3% for 2020 differs from the federal statutory rate of 21.0% primarily due to the benefit of the CARES Act and to the effects of state income taxes and various permanent differences, including those related to the non-deductible goodwill impairment charge. See Note 13 to the Consolidated Financial Statements for additional information regarding our income tax provision (benefit), as well as our net deferred tax assets and other matters.

We have net deferred tax assets of $5,528 as of November 26, 2022, which, upon utilization, are expected to reduce our cash outlays for income taxes in future years. It will require approximately $22,000 of future taxable income to utilize our net deferred tax assets.

Liquidity and Capital Resources

We are committed to maintaining a strong balance sheet in order to weather difficult industry conditions, to allow us to take advantage of opportunities as market conditions improve, and to execute our long-term retail strategies.

Cash Flows

Cash provided by operations for fiscal 2022 was a net use of $2,970 compared to cash provided by operations of $14,563 for fiscal 2021, representing a decrease of $17,533. Cash provided by the operating activities of our discontinued operations was $1,681 for fiscal 2022 compared to $4,082 for the prior year period, a decline of $2,401 as Zenith only operated during the first quarter of fiscal 2022. Excluding the decline in operating cash flow from discontinued operations, cash flows from continuing operations declined $14,132 from the prior year. Cash flows from operating activities included the payment of $20,176 in estimated income taxes net of refunds in 2022 as compared to $3,092 in 2021, the increase primarily related to the taxable gain on the sale of Zenith. In addition, cash flows from the collection of retail customer deposits declined by $28,318 due to the slowing pace of retail written sales.

Our overall cash position increased by $27,251 during fiscal 2022, compared to a decline of $11,425 during fiscal 2021, an increase of $38,676 from the prior year. Excluding the overall cash flow from discontinued operations, overall cash flow from continuing operations increased $35,762 over the prior year. Offsetting the decline in cash flows from operations, net cash flows from investing activities during the fiscal 2022 increased $77,413 to $65,534 of cash provided by investing activities compared to net cash used in investing activities of $11,571 for the prior year. This increase was primarily due to net proceeds of $84,534 received from the sale of Zenith and net proceeds of $8,217 received from the sale of retail real estate in Houston, Texas, partially offset by a $10,543 increase in capital expenditures over the prior year, including our purchase of our new retail store site in Tampa, Florida, and our net cash investment in Noa Home of $5,582. Net cash used in financing activities during the fiscal 2022 increased $21,146 to a net use of $35,563 as compared to a net use of $14,417 for the prior year, primarily due to a special dividend of $14,494 declared and paid during the second quarter of 2022 and a $9,556 increase in share repurchases to $15,122 during fiscal 2022 as compared to $5,566 repurchased during fiscal 2021. On March 9, 2022, our Board of Directors increased the amount authorized under our existing share repurchase plan to $40,000, of which $25,999 remains available for future purchases as of November 26, 2022. With cash and cash equivalents and short-term investments totaling $79,340 on hand at November 26, 2022, expected future operating cash flows and the availability under our credit line noted below, we believe we have sufficient liquidity to fund operations for the foreseeable future.

22

Debt and Other Obligations

Bank Credit Facility

Our bank credit facility provides for a line of credit of up to $25,000. At November 26, 2022, we had $3,931 outstanding under standby letters of credit against our line, leaving availability under our credit line of $21,069. In addition, we had outstanding standby letters of credit with another bank totaling $250 at November 26, 2022. The line bears interest at the One-Month Term Secured Overnight Financing Rate (“One-Month Term SOFR”) plus 1.5% and is unsecured. Our bank charges a fee of 0.25% on the daily unused balance of the line, payable quarterly. Under the terms of the facility, we must maintain the following financial covenants, measured quarterly on a rolling twelve-month basis:

● Consolidated fixed charge coverage ratio of not less than 1.4 times,

● Consolidated lease-adjusted leverage ratio not to exceed 3.0 times, and

● Minimum tangible net worth of $140,000.

We were in compliance with these covenants at November 26, 2022 and expect to remain in compliance for the foreseeable future. The credit facility will mature on January 27, 2025, at which time any amounts outstanding under the facility will be due.

We lease land and buildings that are used in the operation of our Company-owned retail stores as well as in the operation of certain of our licensee-owned stores, and we lease land and buildings at various locations throughout the continental United States for warehouse space used in our retail segment. We also lease local delivery trucks used in our retail segment. The total future minimum lease payments for leases with terms in excess of one year at November 26, 2022 is $138,543, the present value of which is $116,938 and is included in our accompanying consolidated balance sheet at November 26, 2022. We were contingently liable under licensee lease obligation guarantees in the amount of $1,880 at November 26, 2022. The remaining terms under these lease guarantees range from approximately one to five years. See Note 15 to our consolidated financial statements for a schedule of future cash payments on our lease obligations and additional details regarding our leases and lease guarantees.

We provide post-employment benefits to certain current and former executives and management level employees of the Company. Included among these benefits are two defined-benefit plans with a combined projected benefit obligation of $7,262 at November 26, 2022. See Note 10 to our consolidated financial statements for a projection of future benefit payments under these plans from 2023 through 2032. We also have deferred compensation plans with a total liability of $3,686 at November 26, 2022, the current portion of which is $296. See Note 10 to our consolidated financial statements for additional information regarding these plans.

Dividends and Share Repurchases

During fiscal 2022, we declared and paid four quarterly dividends totaling $5,668, or $0.60 per share, as well as one special dividend totaling $14,494, or $1.50 per share. During fiscal 2022, we repurchased 868,085 shares of our stock for $15,122 under our share repurchase program. The weighted-average effect of these share repurchases on earnings per share from continuing operations was approximately $0.10 per share basic and $0.11 per share diluted. On March 9, 2022, our Board of Directors increased the remaining limit of the repurchase plan to $40,000. The approximate dollar value that may yet be purchased pursuant to our stock repurchase program as of November 28, 2022 was $25,999.

Capital Expenditures

We currently anticipate that total capital expenditures for fiscal 2023 will be approximately $25 million, which will be used for the upfit of new and remodeled retail stores, the expansion and upgrade of our outdoor furniture manufacturing facilities in Haleyville, Alabama and additional investments in information technology, including a new website. Our capital expenditure and working capital requirements in the foreseeable future may change depending on many factors, including but not limited to the overall performance of the store program, our rate of growth, our operating results and any adjustments in our operating plan needed in response to industry conditions, competition or unexpected events. We believe that our existing cash, together with cash from operations, will be sufficient to meet our capital expenditure and working capital requirements for the foreseeable future.

Fair Value Measurements

We account for items measured at fair value in accordance with ASC Topic 820, Fair Value Measurements and Disclosures. ASC 820’s valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect our market assumptions. ASC 820 classifies these inputs into the following hierarchy:

Level 1 Inputs– Quoted prices for identical instruments in active markets.

Level 2 Inputs– Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.

Level 3 Inputs– Instruments with primarily unobservable value drivers.

We believe that the carrying amounts of our current assets and current liabilities approximate fair value due to the short-term nature of these items. Our primary non-recurring fair value estimates, typically involving the valuation of business acquisitions (see Note 3 to the Consolidated Financial Statements), goodwill impairments (see Note 8 to the Consolidated Financial Statements) and asset impairments (see Note 14 to the Consolidated Financial Statements) have utilized Level 3 inputs.

23

Off-Balance Sheet Arrangements

We utilize stand-by letters of credit in the procurement of certain goods in the normal course of business. We lease land and buildings that are primarily used in the operation of BHF stores and Zenith distribution facilities. We have guaranteed certain lease obligations of licensee operators as part of our retail strategy. See Note 15 to the Consolidated Financial Statements, included in Item 8 of this Annual Report on Form 10-K, for further discussion of lease guarantees, including descriptions of the terms of such commitments and methods used to mitigate risks associated with these arrangements.

Contingencies

We are involved in various claims and litigation as well as environmental matters, which arise in the normal course of business. Although the final outcome of these legal and environmental matters cannot be determined, based on the facts presently known, it is our opinion that the final resolution of these matters will not have a material adverse effect on our financial position or future results of operations.

Critical Accounting Policies and Estimates

Our consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) which requires that certain estimates and assumptions be made that affect the amounts and disclosures reported in those financial statements and the related accompanying notes. Actual results could differ from these estimates and assumptions. We use our best judgment in valuing these estimates and may, as warranted, solicit external advice. Estimates are based on current facts and circumstances, prior experience and other assumptions believed to be reasonable. The following critical accounting policies, some of which are impacted significantly by judgments, assumptions and estimates, affect our consolidated financial statements.

Revenue Recognition - We recognize revenue when we transfer promised goods to our customers in an amount that reflects the consideration that we expect to receive in exchange for those goods. For our wholesale and retail segments, revenue is recognized when the risks and rewards of ownership and title to the product have transferred to the buyer.

At wholesale, transfer occurs and revenue is recognized upon the shipment of goods to independent dealers and licensee-owned BHF stores. We offer payment terms varying from 30 to 60 days for wholesale customers. Estimates for returns and allowances have been recorded as a reduction of revenue based on our historical return patterns. The contracts with our licensee store owners do not provide for any royalty or license fee to be paid to us.

At retail, transfer occurs and revenue is recognized upon delivery of goods to the customer. We typically collect a significant portion of the purchase price as a customer deposit upon order, with the balance typically collected upon delivery. These deposits are carried on our balance sheet as a current liability until delivery is fulfilled and amounted to $35,963 and $51,492 as of November 26, 2022 and November 27, 2021, respectively. Substantially all of the customer deposits held at November 27, 2021 related to performance obligations satisfied during fiscal 2022 and have therefore been recognized in revenue for the year ended November 26, 2022. Estimates for returns and allowances have been recorded as a reduction of revenue based on our historical return patterns. We also sell furniture protection plans to our retail customers on behalf of a third party which is responsible for the performance obligations under the plans. Revenue from the sale of these plans is recognized upon delivery of the goods net of amounts payable to the third-party service provider.

Allowance for credit losses - We maintain an allowance for credit losses for estimated losses resulting from the inability of our customers to make required payments. Our accounts receivable reserves were $1,261 and $567 at November 26, 2022 and November 27, 2021, respectively, representing 6.6% and 2.7% of our gross accounts receivable balances at those dates, respectively. The allowance for credit losses is based on a review of specifically identified customer accounts in addition to an overall aging analysis which is applied to accounts pooled on the basis of similar risk characteristics. Judgments are made with respect to the collectibility of accounts receivable within each pool based on historical experience, current payment practices and current economic trends based on our expectations over the expected life of the receivables, which is generally ninety days or less. Although actual losses have not differed materially from our previous estimates, future losses could differ from our current estimates. Unforeseen events such as a licensee or customer bankruptcy filing could have a material impact on our results of operations.

Inventories - Inventories accounted for under the first-in, first out (“FIFO”) method are stated at the lower of cost or net realizable value, and inventory accounted for under the last-in, first out method (“LIFO”) is stated at the lower of cost or market. Cost is determined for domestic furniture inventories, excluding outdoor furniture products, using the LIFO method. The cost of imported inventories, domestic outdoor furniture products and Noa Home product inventories is determined on a FIFO basis. We estimate an inventory reserve for excess quantities and obsolete items based on specific identification and historical write-offs, taking into account future demand and market conditions. Our reserves for excess and obsolete inventory were $5,167 and $4,816 at November 26, 2022 and November 27, 2021, respectively, representing 5.7% and 5.8%, respectively, of our inventories on a LIFO basis. If actual demand or market conditions in the future are less favorable than those estimated, additional inventory write-downs may be required.

24

Goodwill – Goodwill represents the excess of the fair value of consideration given over the fair value of the tangible assets and liabilities and identifiable intangible assets of businesses acquired. The acquisition of assets and liabilities and the resulting goodwill is allocated to the respective reporting unit: Wood, Upholstery, Retail – Company-Owned Stores, and Noa Home. We review goodwill at the reporting unit level annually for impairment or more frequently if events or circumstances indicate that assets might be impaired.

In accordance with ASC Topic 350, Intangibles – Goodwill & Other, we first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative goodwill impairment test described in ASC Topic 350 (as amended by Accounting Standards Update No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment). The more likely than not threshold is defined as having a likelihood of more than 50 percent. If, after assessing the totality of events or circumstances, we determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the quantitative impairment test is unnecessary and our goodwill is considered to be unimpaired. However, if based on our qualitative assessment we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, we will proceed with performing the quantitative evaluation process. We performed an interim test of goodwill as of May 30, 2020 due to the severe impact of the COVID-19 pandemic and resulting business interruption during the second fiscal quarter of 2020. This interim test resulted in an impairment charge of $1,971 for the year ended November 28, 2020. For the annual tests of goodwill performed as of the beginning of the fourth fiscal quarters of 2021 and 2022, we performed the qualitative assessment as described above and concluded that there has been no additional impairment of our goodwill as of November 26, 2022.

The quantitative evaluation compares the carrying value of each reporting unit that has goodwill with the estimated fair value of the respective reporting unit. Should the carrying value of a reporting unit be in excess of the estimated fair value of that reporting unit, a goodwill impairment charge will be recognized in the amount by which the reporting unit’s carrying amount exceeds its fair value, but not to exceed the total goodwill assigned to the reporting unit. The determination of the fair value of our reporting units is based on a combination of a market approach, that considers benchmark company market multiples, an income approach, that utilizes discounted cash flows for each reporting unit and other Level 3 inputs as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurements and Disclosure, and, in the case of our retail reporting unit, a cost approach that utilizes estimates of net asset value. The cash flows used to determine fair value are dependent on a number of significant management assumptions such as our expectations of future performance and the expected future economic environment, which are partly based upon our historical experience. Our estimates are subject to change given the inherent uncertainty in predicting future results. Additionally, the discount rate and the terminal growth rate are based on our judgment of the rates that would be utilized by a hypothetical market participant. As part of the goodwill impairment testing, we also consider our market capitalization in assessing the reasonableness of the combined fair values estimated for our reporting units. While we believe such assumptions and estimates are reasonable, the actual results may differ materially from the projected amounts.

Other Intangible Assets – Intangible assets acquired in a business combination and determined to have an indefinite useful life are not amortized but are tested for impairment annually or between annual tests when an impairment indicator exists. The recoverability of indefinite-lived intangible assets is assessed by comparison of the carrying value of the asset to its estimated fair value. If we determine that the carrying value of the asset exceeds its estimated fair value, an impairment loss equal to the excess would be recorded. At November 26, 2022, our indefinite-lived intangible assets other than goodwill consist of trade names acquired in the acquisitions of Lane Venture and Noa Home and have a carrying value of $8,723.

Definite-lived intangible assets are amortized over their respective estimated useful lives and reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. We estimate the useful lives of our intangible assets and ratably amortize the value over the estimated useful lives of those assets. If the estimates of the useful lives should change, we will amortize the remaining book value over the remaining useful lives or, if an asset is deemed to be impaired, a write-down of the value of the asset may be required at such time. At November 26, 2022 our definite-lived intangible assets consist of customer relationships acquired in the acquisition of Lane Venture with a carrying value of $232.

Impairment of Long-Lived Assets - We periodically evaluate whether events or circumstances have occurred that indicate long-lived assets may not be recoverable or that the remaining useful life may warrant revision. When such events or circumstances are present, we assess the recoverability of long-lived assets by determining whether the carrying value will be recovered through the expected undiscounted future cash flows resulting from the use of the asset. In the event the sum of the expected undiscounted future cash flows is less than the carrying value of the asset, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. When analyzing our real estate properties for potential impairment, we consider such qualitative factors as our experience in leasing and selling real estate properties as well as specific site and local market characteristics. Upon the closure of a Bassett Home Furnishings store, we generally write off all tenant improvements which are only suitable for use in such a store. Right of use assets under operating leases are written down to their estimated fair value. Our estimates of the fair value of the impaired right of use assets include estimates of discounted cash flows based upon current market rents and other inputs which we consider to be Level 3 inputs as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurement and Disclosure.

Recent Accounting Pronouncements

See Note 2 to our Consolidated Financial Statements regarding the impact or potential impact of recent accounting pronouncements upon our financial position and results of operations.

25

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risk from changes in the value of foreign currencies. Substantially all of our purchases outside of North America are denominated in U.S. dollars. Therefore, we believe that gains or losses resulting from changes in the value of foreign currencies relating to foreign purchases not denominated in U.S. dollars would not be material to our results from operations in fiscal 2022. We are also exposed to foreign currency market risk through our investment in Noa Home. Our investment in Noa Home is subject to changes in the value of the Canadian dollar versus the U.S. dollar. Additionally, Noa Home is exposed to other local currency fluctuation risk through its operations in Australia, Singapore and the United Kingdom. The impact of currency fluctuations on our financial position and results of operations since the acquisition of Noa Home on September 2, 2022 has not been significant.

We are exposed to market risk from changes in the cost of raw materials used in our manufacturing processes, principally wood, woven fabric, and foam products. The cost of foam products, which are petroleum-based, is sensitive to changes in the price of oil.

We are also exposed to commodity price risk related to diesel fuel prices for fuel used in our retail segment for home delivery as well as through amounts we are charged for logistical services by our service providers. We manage our exposure to that risk primarily through the application of fuel surcharges to our customers.

We have potential exposure to market risk related to conditions in the commercial real estate market. Our retail real estate holdings of $21,164 and $16,971 at November 26, 2022 and November 27, 2021, respectively, for Company-owned stores, consisting of eight locations with a total of 203,465 square feet of space, could suffer significant impairment in value if we are forced to close additional stores and sell or lease the related properties during periods of weakness in certain markets. Additionally, if we are required to assume responsibility for payment under the lease obligations of $1,880 and $1,845 which we have guaranteed on behalf of licensees as of November 26, 2022 and November 27, 2021, respectively, we may not be able to secure sufficient sub-lease income in the current market to offset the payments required under the guarantees. We are also exposed to risk related to conditions in the commercial real estate rental market with respect to the right-of-use assets we carry on our balance sheet for leased retail store locations and warehouse facilities. At November 26, 2022, the unamortized balance of such right-of-use assets totaled $98,788. Should we have to close or otherwise abandon one of these leased locations, we could incur additional impairment charges if rental market conditions do not support a fair value for the right of use asset in excess of its carrying value.

26

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of Bassett Furniture Industries, Incorporated and Subsidiaries

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Bassett Furniture Industries, Incorporated and Subsidiaries (the Company) as of November 26, 2022 and November 27, 2021, and the related consolidated statements of operations, comprehensive income (loss), stockholders' equity and cash flows for each of the three years in the period ended November 26, 2022, and the related notes and financial statement schedule listed in the Index at Item 15(a)(2) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at November 26, 2022 and November 27, 2021, and the results of its operations and its cash flows for each of the three years in the period ended November 26, 2022, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of November 26, 2022, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated January 24, 2023 expressed an unqualified opinion thereon.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

27

Measurement of Reserves for Excess and Obsolete Inventories

	Measurement of Reserves for Excess and Obsolete Inventories
Description of the Matter	At November 26, 2022, the Company’s inventories were $85.5 million. As discussed in Note 2 and Note 6 to the consolidated financial statements, cost for domestic manufactured furniture inventories is determined using the last-in, first-out (“LIFO”) method and are stated at the lower of cost or market. The cost of imported inventories and domestic outdoor furniture products is determined using the first-in, first-out (“FIFO”) method and stated at the lower of cost or net realizable value. Reserves for excess and obsolete inventories are determined based upon historical write-offs, forecasted future demand, market conditions and, for domestic manufactured furniture, the respective valuations at LIFO. Auditing management’s lower of cost or net realizable value or market determination for excess or obsolete inventories was complex due to the highly judgmental nature and estimation uncertainty in determining future demand and market conditions.
How We Addressed the Matter in Our Audit	We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s determination of the reserves for excess and obsolete inventories. For example, we tested controls over management’s review of the calculation of reserves for excess and obsolete inventories which included their review of the significant assumptions described above. Our audit procedures to test the reserves for excess and obsolete inventories included, among others, testing the completeness and accuracy of the underlying data used in management’s analyses. We evaluated the reasonableness of management’s assumptions by performing a retrospective review of the prior year assumptions to actual activity, including write-off history. We held discussions with senior financial and operational management to determine whether any strategic or operational changes in the business would impact expected demand for or related carrying value of inventory. We also performed sensitivity analyses of significant assumptions to evaluate the impact that changes would have on the inventory reserves. We searched for and evaluated information that corroborated or contradicted the Company’s assumptions.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2002.

Richmond, Virginia

January 24, 2023

28

Consolidated Balance Sheets

Bassett Furniture Industries, Incorporated and Subsidiaries

November 26, 2022 and November 27, 2021

(In thousands, except share and per share data)

	2022		2021
Assets
Current assets
Cash and cash equivalents	$	61,625	$	34,374
Short-term investments		17,715		17,715
Accounts receivable, net of allowance for credit losses of $1,261 and $567 as of November 26, 2022 and November 27, 2021, respectively		17,838		20,567
Inventories		85,477		78,004
Recoverable income taxes		2,353		8,379
Current assets of discontinued operations held for sale		-		11,064
Other current assets		11,487		10,181
Total current assets		196,495		180,284
Property and equipment, net		77,001		69,168
Other long-term assets
Deferred income taxes, net		5,528		3,189
Goodwill and other intangible assets		21,727		14,354
Right of use assets under operating leases		99,472		95,955
Long-term assets of discontinued operations held for sale		-		52,757
Other		6,050		5,953
Total other long-term assets		132,777		172,208
Total assets	$	406,273	$	421,660
Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	20,359	$	23,988
Accrued compensation and benefits		12,921		12,639
Customer deposits		35,963		51,492
Current portion of operating lease obligations		18,819		20,235
Current liabilites of discontinued operations held for sale		-		16,095
Other accrued liabilities		12,765		9,770
Total current liabilities		100,827		134,219
Long-term liabilities
Post employment benefit obligations		9,954		12,968
Long-term portion of operating lease obligations		97,477		94,845
Long-term liabilities of discontinued operations held for sale		-		16,210
Other long-term liabilities		2,406		686
Total long-term liabilities		109,837		124,709
Commitments and Contingencies
Stockholders equity
Common stock, $5 par value; 50,000,000 shares authorized; issued and outstanding 8,951,839 at November 26, 2022 and 9,762,125 at November 27, 2021		44,759		48,811
Retained earnings		150,800		115,631
Additional paid-in-capital		-		113
Accumulated other comprehensive income (loss)		50		(1,823	)
Total stockholders' equity		195,609		162,732
Total liabilities and stockholders’ equity	$	406,273	$	421,660

The accompanying notes to consolidated financial statements are an integral part of these statements.

29

Consolidated Statements of Operations

Bassett Furniture Industries, Incorporated and Subsidiaries

For the years ended November 26, 2022, November 27, 2021, and November 28, 2020

(In thousands, except per share data)

	2022			2021			2020
Net sales of furniture and accessories	$	485,601		$	430,886		$	337,672
Cost of furniture and accessories sold		237,262			209,799			163,567
Gross profit		248,339			221,087			174,105
Selling, general and administrative expenses		218,069			196,830			176,405
Gain on sale of real estate		4,595			-			-
Asset impairment charges		-			-			12,184
Goodwill impairment charge		-			-			1,971
Litigation expense		-			-			1,050
\\
Income (loss) from continuing operations		34,865			24,257			(17,505	)
Interest income		302			48			232
Interest expense		(38	)		(33	)		-
Other loss, net		(1,067	)		(1,515	)		(740	)
Income (loss) from continuing operations before income taxes		34,062			22,757			(18,013	)
Income tax expense (benefit)		8,702			5,836			(6,536	)
Income (loss) from continuing operations		25,360			16,921			(11,477	)
Discontinued operations:
Income from operations of logistical services		1,712			1,483			1,227
Gain on disposal		52,534			-			-
Income tax expense		14,261			362			171
Income from discontinued operations		39,985			1,121			1,056
Net income	$	65,345		$	18,042		$	(10,421	)
Basic earnings (loss) per share:
Income (loss) from continuing operations	$	2.70		$	1.72		$	(1.15	)
Income from discontinued operations		4.26			0.11			0.11
Basic earnings (loss) per share	$	6.96		$	1.83		$	(1.04	)
Diluted earnings (loss) per share:
Income (loss) from continuing operations	$	2.70		$	1.72		$	(1.15	)
Income from discontinued operations		4.26			0.11			0.11
Diluted earnings (loss) per share	$	6.96		$	1.83		$	(1.04	)
Dividends per share
Regular dividends	$	0.60		$	0.53		$	0.46
Special dividend	$	1.50		$	0.25		$	-

The accompanying notes to consolidated financial statements are an integral part of these statements.

30

Consolidated Statements of Comprehensive Income (Loss)

Bassett Furniture Industries, Incorporated and Subsidiaries

For the years ended November 26, 2022, November 27, 2021, and November 28, 2020

(In thousands)

	2022			2021			2020
Net income (loss)	$	65,345		$	18,042		$	(10,421	)
Other comprehensive income (loss):
Foreign currency translation adjustments		(274	)		-			-
Income taxes related to foreign currency translation adjustments		70			-			-
Actuarial adjustment to Long Term Cash Awards (LTCA)		303			26			(86	)
Amortization associated with LTCA		132			144			125
Income taxes related to LTCA		(107	)		(44	)		(10	)
Actuarial adjustment to supplemental executive retirement defined benefit plan (SERP)		2,200			(788	)		(259	)
Amortization associated with SERP		124			44			8
Income taxes related to SERP		(575	)		190			64
Other comprehensive income (loss), net of tax		1,873			(428	)		(158	)
Total comprehensive income (loss)	$	67,218		$	17,614		$	(10,579	)

The accompanying notes to consolidated financial statements are an integral part of these statements.

31

Consolidated Statements of Cash Flows

Bassett Furniture Industries, Incorporated and Subsidiaries

For the years ended November 26, 2022, November 27, 2021, and November 28, 2020

(In thousands)

	2022			2021			2020
Operating activities:
Net income (loss)	$	65,345		$	18,042		$	(10,421	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization		11,309			14,597			13,480
Gain on disposal of discontinued operations		(52,534	)		-			-
Non-cash goodwill impairment charge		-			-			1,971
Non-cash asset impairment charges		-			-			12,184
Net gain on disposals of property and equipment		(4,595	)		(367	)		(81	)
Gains on lease modifications		-			(37	)		(1,313	)
Inventory valuation charges		3,648			2,969			4,922
Deferred income taxes		(2,339	)		1,545			2,513
Other, net		(302	)		765			(51	)
Changes in operating assets and liabilities
Accounts receivable		3,169			(5,828	)		(962	)
Inventories		(9,536	)		(26,087	)		6,494
Other current and long-term assets		5,944			(2,241	)		(9,325	)
Right of use assets under operating leases		20,531			26,243			32,107
Customer deposits		(16,588	)		11,730			14,421
Accounts payable and accrued liabilities		(4,073	)		2,153			5,965
Obligations under operating leases		(22,949	)		(28,921	)		(35,229	)
Net cash provided by (used in) operating activities		(2,970	)		14,563			36,675
Investing activities:
Purchases of property and equipment		(21,296	)		(10,750	)		(6,029	)
Proceeds from sales of property and equipment		8,226			382			2,345
Cash paid for business acquisitions, net of cash acquired		(5,582	)		-			-
Proceeds from the disposition of discontinued operations		84,534			-			-
Purchases of investments		-			-			(295	)
Proceeds from maturities of investments		-			-			16
Other		(40	)		(1,203	)		216
Net cash provided by (used in) investing activities		65,842			(11,571	)		(3,747	)
Financing activities:
Cash dividends		(20,162	)		(7,689	)		(4,544	)
Proceeds from exercise of stock options		-			42			-
Issuance of common stock		424			363			285
Repurchases of common stock		(15,122	)		(5,566	)		(2,208	)
Taxes paid related to net share settlement of equity awards		(19	)		(219	)		(228	)
Repayment of finance lease obligations		(684	)		(1,348	)		(121	)
Net cash used in financing activities		(35,563	)		(14,417	)		(6,816	)
Effect of exchenge rate changes on cash and cash equivalents		(58	)		-			-
Change in cash and cash equivalents		27,251			(11,425	)		26,112
Cash and cash equivalents - beginning of year		34,374			45,799			19,687
Cash and cash equivalents - end of year	$	61,625		$	34,374		$	45,799

The accompanying notes to consolidated financial statements are an integral part of these statements.

32

Consolidated Statements of Stockholders’ Equity

Bassett Furniture Industries, Incorporated and Subsidiaries

For the years ended November 26, 2022, November 27, 2021, and November 28, 2020

(In thousands, except share and per share data)

													Accumulated
							Additional						other
	Common Stock						paid-in			Retained			comprehensive
	Shares			Amount			capital			earnings			income (loss)			Total
Balance, November 30, 2019		10,116,290		$	50,581		$	195		$	129,130		$	(1,236	)	$	178,670
Comprehensive income (loss)
Net loss		-			-			-			(10,421	)		-			(10,421	)
Amortization of defined benefit plan costs, net of tax		-			-			-			-			98			98
Actuarial adjustments to defined benefit plans, net of tax		-			-			-			-			(256	)		(256	)
Cumulative effect of a change in accounting principle		-			-			-			(3,785	)		-			(3,785	)
Regular dividends ($0.455 per share)		-			-			-			(4,545	)		-			(4,545	)
Issuance of common stock		43,218			216			69			-			-			285
Purchase and retirement of common stock		(216,721	)		(1,083	)		(684	)		(669	)		-			(2,436	)
Stock-based compensation		-			-			420			-			-			420
Balance, November 28, 2020		9,942,787			49,714			-			109,710			(1,394	)		158,030
Comprehensive income (loss)
Net income		-			-			-			18,042			-			18,042
Amortization of defined benefit plan costs, net of tax		-			-			-			-			138			138
Actuarial adjustments to defined benefit plans, net of tax		-			-			-			-			(567	)		(567	)
Regular dividends ($0.53 per share)		-			-			-			(5,210	)		-			(5,210	)
Special dividend ($0.25 per share)		-			-			-			(2,479	)		-			(2,479	)
Issuance of common stock		34,902			175			230			-			-			405
Purchase and retirement of common stock		(215,564	)		(1,078	)		(275	)		(4,432	)		-			(5,785	)
Stock-based compensation		-			-			158			-			-			158
Balance, November 27, 2021		9,762,125			48,811			113			115,631			(1,823	)		162,732
Comprehensive income (loss)
Net income		-			-			-			65,345			-			65,345
Foreign currency translation adjustments, net of tax		-			-			-			-			(204	)		(204	)
Amortization of defined benefit plan costs, net of tax		-			-			-			-			192			192
Actuarial adjustments to defined benefit plans, net of tax		-			-			-			-			1,885			1,885
Regular dividends ($0.60 per share)		-			-			-			(5,668	)		-			(5,668	)
Special dividend ($1.50 per share)		-			-			-			(14,494	)		-			(14,494	)
Issuance of common stock		59,024			295			129			-			-			424
Purchase and retirement of common stock		(869,310	)		(4,347	)		(780	)		(10,014	)		-			(15,141	)
Stock-based compensation		-			-			538			-			-			538
Balance, November 26, 2022		8,951,839		$	44,759		$	-		$	150,800		$	50		$	195,609

The accompanying notes to consolidated financial statements are an integral part of these statements.

33

1. Description of Business

Bassett Furniture Industries, Incorporated (together with its consolidated subsidiaries, “Bassett”, “we”, “our”, the “Company”) based in Bassett, Virginia, is a leading manufacturer, marketer and retailer of branded home furnishings. Bassett’s full range of furniture products and accessories, designed to provide quality, style and value, are sold through an exclusive nation-wide network of 91 retail stores known as Bassett Home Furnishings (referred to as “BHF”). Of the 91 stores, the Company owns and operates 58 stores (“Company-owned retail stores”) with the other 33 being independently owned (“licensee operated”). We also distribute our products through other multi-line furniture stores, many of which feature Bassett galleries or design centers. Products can also be purchased by the end consumer directly from our website.

We sourced approximately 22% of our wholesale products from various foreign countries, with the remaining volume produced at our five domestic manufacturing facilities.

Impact of the COVID-19 Pandemic Upon our Financial Condition and Results of Operations

On March 11, 2020, the World Health Organization declared the coronavirus (“COVID-19”) outbreak to be a global pandemic. In response to this declaration and the rapid spread of COVID-19 within the United States, federal, state and local governments throughout the country imposed varying degrees of restrictions on social and commercial activity to promote social distancing in an effort to slow the spread of the illness. These measures had a significant adverse impact upon many sectors of the economy, including non-essential retail commerce, beginning in our second fiscal quarter of 2020.

In response to the restrictive measures imposed by governmental authorities and for the protection of our employees and customers, we temporarily closed our dedicated stores, our manufacturing locations and many of our warehouses for much of the second fiscal quarter of 2020. This extended period of suspended operations had a material adverse impact upon our results of operations during the second fiscal quarter of 2020 and resulted in a significant net loss for 2020. In addition to operating losses resulting from severely reduced sales volumes, we also recorded charges for goodwill impairment (Note 8) as well as for the impairment of certain other long-lived assets (Note 14). However, since restarting our manufacturing operations and reopening stores, we have seen a significant improvement in business conditions which allowed us to return to overall profitability for the third and fourth fiscal quarters of 2020 continuing through fiscal 2021. Tempering these improvements were the continuing logistical challenges faced by the entire home furnishings industry that resulted from COVID-related labor shortages and supply chain disruptions which created significant delays in order fulfillment and increased backlogs. By the end of fiscal 2022, these issues have been substantially resolved.

2. Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The Consolidated Financial Statements include the accounts of Bassett Furniture Industries, Incorporated and our majority-owned subsidiaries in which we have a controlling interest. All significant intercompany balances and transactions are eliminated in consolidation. The financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). Unless otherwise indicated, references in the Consolidated Financial Statements to fiscal 2022, 2021 and 2020 are to Bassett's fiscal year ended November 26, 2022, November 27, 2021 and November 28, 2020, respectively. References to the “ASC” included hereinafter refer to the Accounting Standards Codification established by the Financial Accounting Standards Board as the source of authoritative GAAP.

We analyzed our licensees under the requirements for variable interest entities (“VIEs”). All of these licensees operate as BHF stores and are furniture retailers. We sell furniture to these licensees, and in some cases have extended credit beyond normal terms, made lease guarantees, guaranteed loans, or loaned directly to the licensees. We have recorded reserves for potential exposures related to these licensees. See Note 15 for disclosure of leases and lease guarantees. Based on financial projections and best available information, all licensees have sufficient equity to carry out their principal operating activities without subordinated financial support. Furthermore, we believe that the power to direct the activities that most significantly impact the licensees’ operating performance continues to lie with the ownership of the licensee dealers. Our rights to assume control over or otherwise influence the licensees’ significant activities only exist pursuant to our license and security agreements and are in the nature of protective rights as contemplated under ASC Topic 810. We completed our assessment for other potential VIEs and concluded that there were none. We will continue to reassess the status of potential VIEs including when facts and circumstances surrounding each potential VIE change.

We were the primary beneficiary of one VIE by virtue of our control over the activities that most significantly impact the entity’s economic performance. This VIE was created to affect a Section 1031 like-kind exchange involving the purchase of real property in the state of Florida and the sale of real property in the state of Texas (see Note 14). Subsequent to the completion of the exchange transactions during the third quarter of fiscal 2022, the sole equity interest in the VIE was transferred to Bassett and the entity is now consolidated as a wholly owned subsidiary.

34

On January 31, 2022, we entered into a definitive agreement to sell substantially all of the assets of our wholly-owned subsidiary, Zenith Freight Lines, LLC (“Zenith”) to J.B. Hunt Transport Services, Inc. (“J.B. Hunt”). The sale was completed on February 28, 2022. Accordingly, the operations of our logistical services segment as well as the gain realized upon disposal are presented in the accompanying condensed consolidated statements of income as discontinued operations, and the assets sold to and liabilities assumed by J.B. Hunt are presented in the accompanying condensed consolidated balance sheet as of November 27, 2021 as assets and liabilities of discontinued operations held for sale. See Note 18 for additional information. Costs incurred by Bassett for logistical services performed for Bassett by Zenith are included in selling, general and administrative expenses.

On September 2, 2022, we acquired 100% of the capital stock of Noa Home Inc. (“Noa Home”), a mid-priced e-commerce furniture retailer headquartered in Montreal, Canada. Noa Home has operations in Canada, Australia, Singapore and the United Kingdom. Since acquisition, Noa Home has been consolidated as a wholly-owned subsidiary. See Note 3 for additional information.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Some of the more significant estimates include allowances for doubtful accounts, calculation of inventory reserves, the valuation of our reporting units for the purpose of testing the carrying value of goodwill, and the valuation of our right of use assets. We also utilize estimates in determining the valuation of income tax reserves, lease guarantees, insurance reserves, and assumptions related to our post-employment benefit obligations. Actual results could differ from those estimates.

Revenue Recognition

ASC Topic 606, Revenue from Contracts with Customers, requires a company to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration the company expects to receive in exchange for those goods or services. For our wholesale and retail segments, revenue is recognized when the risks and rewards of ownership and title to the product have transferred to the buyer.

At wholesale, transfer occurs and revenue is recognized upon the shipment of goods to independent dealers and licensee-owned BHF stores. We offer payment terms varying from 30 to 60 days for wholesale customers. Estimates for returns and allowances have been recorded as a reduction of revenue based on our historical return patterns. The contracts with our licensee store owners do not provide for any royalty or license fee to be paid to us.

At retail, transfer occurs and revenue is recognized upon delivery of goods to the customer. We typically collect a significant portion of the purchase price as a customer deposit upon order, with the balance typically collected upon delivery. These deposits are carried on our balance sheet as a current liability until delivery is fulfilled and amounted to $35,963 and $51,492 as of November 26, 2022 and November 27, 2021, respectively. Substantially all of the customer deposits held at November 27, 2021 related to performance obligations were satisfied during fiscal 2022 and have therefore been recognized in revenue for the year ended November 26, 2022. Estimates for returns and allowances have been recorded as a reduction of revenue based on our historical return patterns. We also sell furniture protection plans to our retail customers on behalf of a third party which is responsible for the performance obligations under the plans. Revenue from the sale of these plans is recognized upon delivery of the goods net of amounts payable to the third-party service provider.

Sales commissions are expensed as part of selling, general and administrative expenses at the time revenue is recognized because the amortization period would have been one year or less. Sales commissions at wholesale are accrued upon the shipment of goods. Sales commissions at retail are accrued at the time a sale is written (i.e. – when the customer’s order is placed) and are carried as prepaid commissions in other current assets until the goods are delivered and revenue is recognized. At November 26, 2022 and November 27, 2021, our balance of prepaid commissions included in other current assets was $3,768 and $6,221, respectively.

For our accounting and reporting under ASC 606, we apply the following policy elections and practical expedients:

• We exclude from revenue amounts collected from customers for sales tax, which is consistent with our policy prior to the adoption of ASC 606.

• We do not adjust the promised amount of consideration for the effects of a significant financing component since the period of time between transfer of our goods or services and the collection of consideration from the customer is less than one year.

• We do not disclose the value of unsatisfied performance obligations because the transfer of goods or services is made within one year of the placement of customer orders.

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See Note 20 for disaggregated revenue information.

Cash Equivalents and Short-Term Investments

The Company considers cash on hand, demand deposits in banks and all highly liquid investments with an original maturity of three months or less to be cash and cash equivalents. Our short-term investments consist of certificates of deposit that have original maturities of twelve months or less but greater than three months.

Accounts Receivable

Substantially all of our trade accounts receivable is due from customers located within the United States. We maintain an allowance for credit losses for estimated losses resulting from the inability of our customers to make required payments. The allowance for credit losses is based on a review of specifically identified accounts in addition to an overall aging analysis which is applied to accounts pooled on the basis of similar risk characteristics. Judgments are made with respect to the collectibility of accounts receivable within each pool based on historical experience, current payment practices and current economic trends based on our expectations over the expected life of the receivables, which is generally ninety days or less. Actual credit losses could differ from those estimates.

Concentrations of Credit Risk and Major Customers

Financial instruments that subject us to credit risk consist primarily of investments, accounts and notes receivable and financial guarantees. Investments are managed within established guidelines to mitigate risks. Accounts and notes receivable and financial guarantees subject us to credit risk partially due to the concentration of amounts due from and guaranteed on behalf of independent licensee customers. At November 26, 2022 and November 27, 2021, our aggregate exposure from receivables and guarantees related to customers consisted of the following:

	2022		2021
Accounts receivable, net of allowances (Note 5)	$	17,838	$	20,567
Contingent obligations under lease and loan guarantees, less amounts recognized (Note 15)		1,828		1,794
Other		43		86
Total credit risk exposure related to customers	$	19,709	$	22,447

At November 26, 2022 and November 27, 2021, approximately 31% and 24%, respectively, of the aggregate risk exposure, net of reserves, shown above was attributable to five customers. In fiscal 2022, 2021 and 2020, no customer accounted for more than 10% of total consolidated net sales.

We have no foreign manufacturing operations. We define export sales from our wholesale segment as sales to any country or territory other than the United States or its territories or possessions. Our wholesale export sales were approximately $731, $488, and $789 in fiscal 2022, 2021, and 2020, respectively. All of our export sales are invoiced and settled in U.S. dollars.

Inventories

Inventories (retail merchandise, finished goods, work in process and raw materials) accounted for under the first-in, first out (“FIFO”) method are stated at the lower of cost or net realizable value or, in the case of inventory accounted for under the last-in, first out (“LIFO”) method, at the lower of cost or market. Cost is determined for domestic manufactured furniture inventories using the LIFO method because we believe this methodology provides better matching of revenue and expenses. The cost of imported inventories as well as Lane Venture, Bassett Outdoor and Noa Home product inventories are determined on a first-in, first-out (“FIFO”) basis. Inventories accounted for under the LIFO method represented 46% and 53% of total inventory before reserves at November 26, 2022 and November 27, 2021, respectively. We estimate inventory reserves for excess quantities and obsolete items based on specific identification and historical write-offs, taking into account future demand and market conditions. If actual demand or market conditions in the future are less favorable than those estimated, additional inventory write-downs may be required.

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Property and Equipment

Property and equipment is comprised of all land, buildings and leasehold improvements and machinery and equipment used in the manufacturing and warehousing of furniture, our Company-owned retail operations, our logistical services operations, and corporate administration. This property and equipment is stated at cost less accumulated depreciation. Depreciation is computed over the estimated useful lives of the respective assets utilizing the straight-line method. Buildings and improvements are generally depreciated over a period of 10 to 39 years. Machinery and equipment are generally depreciated over a period of 5 to 10 years. Leasehold improvements are amortized based on the underlying lease term, or the asset’s estimated useful life, whichever is shorter.

Goodwill

Goodwill represents the excess of the fair value of consideration given over the fair value of the tangible assets and liabilities and identifiable intangible assets of businesses acquired. The acquisition of assets and liabilities and the resulting goodwill is allocated to the respective reporting unit: Wood, Upholstery, Retail or Logistical Services. We review goodwill at the reporting unit level annually for impairment or more frequently if events or circumstances indicate that assets might be impaired.

In accordance with ASC Topic 350, Intangibles – Goodwill & Other, we first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative goodwill impairment test described in ASC Topic 350. The more likely than not threshold is defined as having a likelihood of more than 50 percent. If, after assessing the totality of events or circumstances, we determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the quantitative impairment test is unnecessary and our goodwill is considered to be unimpaired. However, if based on our qualitative assessment we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, we will proceed with performing the quantitative evaluation process. We performed an interim test of goodwill as of May 30, 2020 due to the severe impact of the COVID-19 pandemic and resulting business interruption during the second fiscal quarter of 2020. This interim test resulted in an impairment charge of $1,971 for the year ended November 28, 2020. For the annual tests of goodwill performed as of the beginning of the fourth fiscal quarters of 2022 and 2021, we performed the qualitative assessment as described above and concluded that there was no additional impairment of our goodwill as of November 26, 2022 or November 27, 2021.

The quantitative evaluation compares the carrying value of each reporting unit that has goodwill with the estimated fair value of the respective reporting unit. Should the carrying value of a reporting unit be in excess of the estimated fair value of that reporting unit, a goodwill impairment charge will be recognized in the amount by which the reporting unit’s carrying amount exceeds its fair value, but not to exceed the total goodwill assigned to the reporting unit. The determination of the fair value of our reporting units is based on a combination of a market approach, that considers benchmark company market multiples, an income approach, that utilizes discounted cash flows for each reporting unit and other Level 3 inputs as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurements and Disclosure (see Note 4), and, in the case of our retail reporting unit, a cost approach that utilizes estimates of net asset value. The cash flows used to determine fair value are dependent on a number of significant management assumptions such as our expectations of future performance and the expected future economic environment, which are partly based upon our historical experience. Our estimates are subject to change given the inherent uncertainty in predicting future results. Additionally, the discount rate and the terminal growth rate are based on our judgment of the rates that would be utilized by a hypothetical market participant. As part of the goodwill impairment testing, we also consider our market capitalization in assessing the reasonableness of the combined fair values estimated for our reporting units. While we believe such assumptions and estimates are reasonable, the actual results may differ materially from the projected amounts. See Note 8 for additional information regarding the results of our interim goodwill impairment test performed as of May 30, 2020.

Leases

Effective as of the beginning of fiscal 2020, we adopted ASU 2016-02, Leases (Topic 842) and all related amendments. The guidance requires lessees to recognize substantially all leases on their balance sheet as a right-of-use (“ROU”) asset and a lease liability.

We lease land and buildings that are used in the operation of our Company-owned retail stores as well as in the operation of certain of our licensee-owned stores, and we lease land and buildings at various locations throughout the continental United States for warehouse space used in our retail segment. We also lease local delivery trucks used in our retail segment. We determine if a contract contains a lease at inception based on our right to control the use of an identified asset and our right to obtain substantially all of the economic benefits from the use of that identified asset. Our real estate lease terms range from one to 15 years and generally have renewal options of between five and 15years. We assess these options to determine if we are reasonably certain of exercising these options based on all relevant economic and financial factors. Any options that meet this criteria are included in the lease term at lease commencement.

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Most of our leases do not have an interest rate implicit in the lease. As a result, for purposes of measuring our ROU asset and lease liability, we determine our incremental borrowing rate by applying a spread above the U.S. Treasury borrowing rates. In the case an interest rate is implicit in a lease we will use that rate as the discount rate for that lease. Some of our leases contain variable rent payments based on a Consumer Price Index or percentage of sales. Due to the variable nature of these costs, they are not included in the measurement of the ROU asset and lease liability.

We adopted the standard utilizing the transition election to not restate comparative periods for the impact of adopting the standard and recognizing the cumulative impact of adoption in the opening balance of retained earnings. We elected the package of transition expedients available for expired or existing contracts, which allowed the carry-forward of historical assessments of (1) whether contracts are or contain leases, (2) lease classification and (3) initial direct costs. In addition, we have elected the practical expedient to not separate lease and non-lease components when determining the ROU asset and lease liability and have elected the practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements. We have also elected the hindsight practical expedient to determine the lease term for existing leases. In our application of hindsight, we evaluated the performance of the leased stores and the associated markets in relation to our overall real estate strategies, which resulted in the determination that most renewal options would not be reasonably certain in determining the expected lease term. We have made an accounting policy election to not recognize ROU assets and lease liabilities on the balance sheet for those leases with initial terms of one year or less and instead such lease obligations will be expensed on a straight-line basis over the lease term.

Adoption of the standard resulted in the recording of additional net lease-related assets and lease-related liabilities of $146,585 and $151,672, respectively, as of December 1, 2019. The difference between the additional lease assets and lease liabilities, net of the $1,302 deferred tax impact, was $3,785 and was recorded as an adjustment to retained earnings. This adjustment to retained earnings primarily represents the impairment of right-of-use assets associated with certain underperforming retail locations. Our estimates of the fair value of the impaired ROU assets included estimates of discounted cash flows based upon current market rents and other inputs which we consider to be Level 3 inputs as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurement and Disclosure (see Note 4). Our adoption of this standard did not have a material impact on our consolidated statements of operations, comprehensive income or cash flows.

See Note 15 for additional information regarding our leases.

Other Intangible Assets

Intangible assets acquired in a business combination and determined to have an indefinite useful life are not amortized but are tested for impairment annually or between annual tests when an impairment indicator exists. The recoverability of indefinite-lived intangible assets is assessed by comparison of the carrying value of the asset to its estimated fair value. If we determine that the carrying value of the asset exceeds its estimated fair value, an impairment loss equal to the excess would be recorded.

Definite-lived intangible assets are amortized over their respective estimated useful lives and reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. We estimate the useful lives of our intangible assets and ratably amortize the value over the estimated useful lives of those assets. If the estimates of the useful lives should change, we will amortize the remaining book value over the remaining useful lives or, if an asset is deemed to be impaired, a write-down of the value of the asset may be required at such time.

Impairment of Long Lived Assets

We periodically evaluate whether events or circumstances have occurred that indicate long-lived assets may not be recoverable or that the remaining useful life may warrant revision. When such events or circumstances are present, we assess the recoverability of long-lived assets by determining whether the carrying value will be recovered through the expected undiscounted future cash flows resulting from the use and eventual disposition of the asset. In the event the sum of the expected undiscounted future cash flows is less than the carrying value of the asset, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. Fair value is determined based on discounted cash flows or appraised values depending on the nature of the assets. The long-term nature of these assets requires the estimation of cash inflows and outflows several years into the future.

When analyzing our real estate properties for potential impairment, we consider such qualitative factors as our experience in leasing and selling real estate properties as well as specific site and local market characteristics. Upon the closure of a Bassett Home Furnishings store, we generally write off all tenant improvements which are only suitable for use in such a store. ROU assets under operating leases are written down to their estimated fair value. Our estimates of the fair value of the impaired ROU assets included estimates of discounted cash flows based upon current market rents and other inputs which we consider to be Level 3 inputs as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurement and Disclosure (see Note 4).

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Income Taxes

We account for income taxes under the liability method which requires that we recognize deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amount of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. See Note 13.

We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. Despite our belief that our liability for unrecognized tax benefits is adequate, it is often difficult to predict the final outcome or the timing of the resolution of any particular tax matters. We may adjust these liabilities as relevant circumstances evolve, such as guidance from the relevant tax authority or our tax advisors, or resolution of issues in the courts. These adjustments are recognized as a component of income tax expense in the period in which they are identified.

We evaluate our deferred income tax assets to determine if valuation allowances are required or should be adjusted. A valuation allowance is established against our deferred tax assets based on consideration of all available evidence, both positive and negative, using a “more likely than not” standard. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carryforward or carryback periods, our experience with tax attributes expiring unused and tax planning alternatives. In making such judgments, significant weight is given to evidence that can be objectively verified. See Note 13.

Shipping and Handling Costs

Costs incurred to deliver wholesale merchandise to customers are recorded in selling, general and administrative expense and totaled $21,341, $17,829, and $14,779 for fiscal 2022, 2021 and 2020, respectively. Costs incurred to deliver retail merchandise to customers, including the cost of operating regional distribution warehouses, are also recorded in selling, general and administrative expense and totaled $23,812, $22,494, and $19,024 for fiscal 2022, 2021 and 2020, respectively.

Advertising

Costs incurred for producing and distributing advertising and advertising materials are expensed when incurred and are included in selling, general and administrative expenses. Advertising costs totaled $16,698, $15,228, and $12,619 in fiscal 2022, 2021, and 2020, respectively.

Insurance Reserves

We have self-funded insurance programs in place to cover workers’ compensation and health insurance. These insurance programs are subject to various stop-loss limitations. We accrue estimated losses using historical loss experience. Although we believe that the insurance reserves are adequate, the reserve estimates are based on historical experience, which may not be indicative of current and future losses. We adjust insurance reserves, as needed, in the event that future loss experience differs from historical loss patterns.

Supplemental Cash Flow Information

Refer to the supplemental lease disclosures in Note 15 for cash flow impacts of leasing transactions during fiscal 2022, 2021 and 2020. Otherwise, there were no material non-cash investing or financing activities during fiscal 2022, 2021 or 2020.

Recent Accounting Pronouncements

Recently Adopted Pronouncements

Effective as of the beginning of fiscal 2022, we have adopted Accounting Standards Update No. 2019-12 – Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes. The amendments in ASU 2019-12 eliminate certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also clarifies and simplifies other aspects of the accounting for income taxes. The amendments in ASU 2019-12 became effective for us as of the beginning of our 2022 fiscal year. We adopted ASU 2019-12 on a prospective basis and the adoption did not have a material impact upon our financial condition or results of operations.

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Recent Pronouncements Not Yet Adopted

In October 2021, the FASB issued Accounting Standards Update No. 2021-08– Business Combinations (Topic 805) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, to improve the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to the recognition of an acquired contract liability and to payment terms and their effect on subsequent revenue recognized by the acquirer. The amendments in ASU 2021-08 require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. The amendments in ASU 2021-08 will become effective for us as of the beginning of our 2024 fiscal year. Early adoption is permitted, including adoption in any interim period. We do not expect that this guidance will have a material impact upon our financial position and results of operations.

In March 2022, the FASB issued Accounting Standards Update No. 2022-02 – Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures, to address certain concerns identified in the Post-Implementation Review process for ASU Topic 326. The amendments in ASU 2022-02 eliminate the accounting guidance for troubled debt restructurings by creditors in ASC Subtopic 310-40, Receivables – Troubled Debt Restructurings by Creditors, while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. In addition, for public business entities, the amendments in ASU 2022-02 require that an entity disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of ASC Subtopic 326-20, Financial Instruments – Credit Losses – Measured at Amortized Cost. The amendments in ASU 2022-02 will become effective for us as of the beginning of our 2024 fiscal year. Early adoption is permitted. We expect that the adoption of this standard will primarily impact our disclosures but do not expect that this guidance will have a material impact upon our financial position and results of operations.

In June 2022, the FASB issued Accounting Standards Update No. 2022-03 – Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, to clarify the guidance in Topic 820 when measuring the fair value of an equity security subject to contractual restrictions that prohibit the sale of an equity security. The amendments in ASU 2022-03 clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. In addition, the amendments in ASU 2022-03 require certain additional disclosures related to investments in equity securities subject to contractual sale restrictions. The amendments in ASU 2022-03 will become effective for us as of the beginning of our 2025 fiscal year. Early adoption is permitted. As of August 27, 2022 we do not hold any investments in equity securities, therefore we do not currently expect that this guidance will have a material impact upon our financial position and results of operations.

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3. Business Combinations

On September 2, 2022, we acquired 100% of the capital stock of Noa Home Inc. (“Noa Home”), a mid-priced e-commerce furniture retailer headquartered in Montreal, Canada. Noa Home has operations in Canada, Australia, Singapore and the United Kingdom. The initial purchase price (denominated in Canadian dollars) of approximately C$7,700 included cash payments of C$2,000 paid to the co-founders of Noa Home and approximately C$5,700 for the repayment of existing debt owed by Noa Home. The Noa Home co-founders will also have the opportunity to receive additional cash payments totaling approximately C$1,330 per year for the following three fiscal years based on established increases in net revenues and achieving certain internal EBITDA goals.

Under the acquisition method of accounting, the fair value of the consideration transferred was allocated to the tangible and intangible assets acquired and the liabilities assumed based on their estimated fair values as of the acquisition date with the remaining unallocated amount recorded as goodwill.

The allocation of the fair value of the acquired business has been based on a preliminary valuation. Our estimates and assumptions are subject to change as we obtain additional information for our estimates during the measurement period (up to one year from the acquisition date). The primary areas of the preliminary allocation of the fair value of consideration transferred that are not yet finalized relate to the fair values of certain tangible and intangible assets acquired and the residual goodwill. The preliminary allocation of the purchase price (translated into U.S. dollars as of the acquisition date) is as follows:

Fair value of consideration transferred in exchange for 100% of Noa Home:
Cash	$	5,878
Fair value of contingent consideration payable		1,375
Total fair value of consideration paid or payable	$	7,253
Allocation of the fair value of consideration transferred:
Identifiable assets acquired:
Cash	$	296
Inventory		1,585
Other current assets		317
Property & equipment		155
Intangible asset - trade name		1,929
Total identifiable assets acquired		4,282
Liabilities assumed:
Accounts payable		(1,227	)
Customer deposits		(1,059	)
Other current liabilities and accrued expenses		(458	)
Total liabilities assumed		(2,744	)
Net identifiable assets acquired		1,538
Goodwill		5,715
Total net assets acquired	$	7,253

Goodwill was determined based on the residual difference between the fair value of the consideration transferred and the value assigned to the tangible and intangible assets and liabilities recognized in connection with the acquisition and is deductible for tax purposes. Among the factors that contributed to a purchase price resulting in the recognition of goodwill are the expected synergies arising from combining the Company’s manufacturing and distribution capabilities with Noa Home’s position in the international e-commerce market for home furnishings and accessories.

A portion of the fair value of the consideration transferred in the amount of $1,929 has been assigned to the identifiable intangible asset associated with the Noa Home trade name. This intangible asset is considered to have an indefinite life. The indefinite-lived intangible asset and goodwill are not amortized but will be tested for impairment annually or between annual tests if an indicator of impairment exists.

The fair values of consideration transferred and net assets acquired were determined using a combination of Level 2 and Level 3 inputs as specified in the fair value hierarchy in ASC 820, Fair Value Measurements and Disclosures. See Note 4.

Acquisition costs related to the Noa Home acquisition totaled $87 during the year ended November 26, 2022, and are included in selling, general and administrative expenses in the consolidated statements of income. The acquisition costs are primarily related to legal services.

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The revenues and results of operations of Noa Home since September 2, 2022 were not material. The pro forma impact of the acquisition has not been presented because it was not material to our consolidated results of operations for the three fiscal years ended November 26, 2022.

4. Financial Instruments, Investments and Fair Value Measurements

Financial Instruments

Our financial instruments include cash and cash equivalents, short-term investments in certificates of deposit, accounts receivable, accounts payable and long-term debt. Because of their short maturities, the carrying amounts of cash and cash equivalents, short-term investments in certificates of deposit, accounts receivable, and accounts payable approximate fair value.

Investments

Our short-term investments of $17,715 at both November 26, 2022 and November 27, 2021 consisted of certificates of deposit (CDs) with original terms of six to twelve months, bearing interest at rates ranging from 0.3% to 3.1%. At November 26, 2022, the weighted average remaining time to maturity of the CDs was approximately three months and the weighted average yield of the CDs was approximately 2.2%. Each CD is placed with a federally insured financial institution and all deposits are within Federal deposit insurance limits. As the CDs mature, we expect to reinvest them in CDs of similar maturities of up to one year. Due to the nature of these investments and their relatively short maturities, the carrying amount of the short-term investments at November 26, 2022 and November 27, 2021 approximates their fair value.

Fair Value Measurement

The Company accounts for items measured at fair value in accordance with ASC Topic 820, Fair Value Measurements and Disclosures. ASC 820’s valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect our market assumptions. ASC 820 classifies these inputs into the following hierarchy:

Level 1 Inputs– Quoted prices for identical instruments in active markets.

Level 2 Inputs– Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.

Level 3 Inputs– Instruments with primarily unobservable value drivers.

We believe that the carrying amounts of our current assets and current liabilities approximate fair value due to the short-term nature of these items. Our primary non-recurring fair value estimates typically involve the following: business acquisitions (Note 3) which involve a combination of Level 2 and Level 3 inputs to determine the fair value of contingent consideration and net assets acquired, including identified intangible assets; goodwill impairment testing (Note 8), which involves Level 3 inputs; and asset impairments (Note 14) which utilize Level 3 inputs.

5. Accounts Receivable

Accounts receivable consists of the following:

	November 26, 2022			November 27, 2021
Gross accounts receivable	$	19,099		$	21,134
Allowance for credit losses		(1,261	)		(567	)
Net accounts receivable	$	17,838		$	20,567

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Activity in the allowance for credit losses was as follows:

	2022			2021
Balance, beginning of the year	$	567		$	905
Additions (recoveries) charged to expense		761			(161	)
Reductions to allowance, net		(67	)		(177	)
Balance, end of the year	$	1,261		$	567

We believe that the carrying value of our net accounts receivable approximates fair value. The inputs into these fair value estimates reflect our market assumptions and are not observable. Consequently, the inputs are considered to be Level 3 as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurements and Disclosures. See Note 4.

6. Inventories

Inventories consist of the following:

	November 26, 2022			November 27, 2021
Wholesale finished goods	$	46,607		$	40,254
Work in process		620			482
Raw materials and supplies		22,859			21,653
Retail merchandise		32,974			30,914
Total inventories on first-in, first-out method		103,060			93,303
LIFO adjustment		(12,416	)		(10,483	)
Reserve for excess and obsolete inventory		(5,167	)		(4,816	)
	$	85,477		$	78,004

We source a significant amount of our wholesale product from other countries. During 2022, 2021 and 2020, purchases from our two largest vendors located in Vietnam and China were $33,253, $34,658 and $15,378 respectively.

We estimate an inventory reserve for excess quantities and obsolete items based on specific identification and historical write-offs, taking into account future demand, market conditions and the respective valuations at LIFO. The need for these reserves is primarily driven by the normal product life cycle. As products mature and sales volumes decline, we rationalize our product offerings to respond to consumer tastes and keep our product lines fresh. If actual demand or market conditions in the future are less favorable than those estimated, additional inventory write-downs may be required. In determining reserves, we calculate separate reserves on our wholesale and retail inventories. Our wholesale inventories tend to carry the majority of the reserves for excess quantities and obsolete inventory due to the nature of our distribution model. These wholesale reserves primarily represent design and style obsolescence. Typically, product is not shipped to our retail warehouses until a consumer has ordered and paid a deposit for the product. We do not typically hold retail inventory for stock purposes. Consequently, floor sample inventory and inventory for delivery to customers account for the majority of our inventory at retail. Retail reserves are based on accessory and clearance floor sample inventory in our stores and any inventory that is not associated with a specific customer order in our retail warehouses.

Activity in the reserves for excess quantities and obsolete inventory by segment are as follows:

	Wholesale Segment			Retail Segment			Total
Balance at November 28, 2020	$	3,421		$	1,101		$	4,522
Additions charged to expense		2,057			912			2,969
Write-offs		(1,795	)		(880	)		(2,675	)
Balance at November 27, 2021		3,683			1,133			4,816
Additions charged to expense		2,577			1,071			3,648
Write-offs		(2,157	)		(1,140	)		(3,297	)
Balance at November 26, 2022	$	4,103		$	1,064		$	5,167

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7. Property and Equipment

Property and equipment consist of the following:

	November 26, 2022			November 27, 2021
Land	$	10,866		$	8,538
Buildings and leasehold improvements		116,418			107,975
Machinery and equipment		101,153			94,521
Property and equipment at cost		228,437			211,034
Less accumulated depreciation		(151,436	)		(141,866	)
Property and equipment, net	$	77,001		$	69,168

The net book value of our property and equipment by reportable segment is a follows:

	November 26, 2022		November 27, 2021
Wholesale	$	36,502	$	30,020
Retail - Company-owned stores		40,499		39,148
Total property and equipment, net	$	77,001	$	69,168

Depreciation expense associated with the property and equipment shown above was included in income from operations in our consolidated statements of operations as follows:

	2022		2021		2020
Cost of goods sold (wholesale segment)	$	2,082	$	1,797	$	1,552
Selling, general and adminstrative expenses:
Wholesale segment		2,154		1,532		1,516
Retail segment		5,750		6,580		6,578
Total included in selling, general and adminstrative expenses		7,904		8,112		8,094
Total depreciation expense included in income from operations	$	9,986	$	9,909	$	9,646

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8. Goodwill and Other Intangible Assets

Goodwill and other intangible assets consisted of the following:

	November 26, 2022
	Gross Carrying Amount		Accumulated Amortization			Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	$	512	$	(280	)	$	232
Intangibles not subject to amortization:
Trade names							8,723
Goodwill							12,772
Total goodwill and other intangible assets						$	21,727

	November 27, 2021
	Gross Carrying Amount		Accumulated Amortization			Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	$	512	$	(223	)	$	289
Intangibles not subject to amortization:
Trade names							6,848
Goodwill							7,217
Total goodwill and other intangible assets						$	14,354

Due to the impact of the COVID-19 pandemic during our 2020 fiscal year, we performed an interim impairment assessment of our remaining goodwill as of May 30, 2020, the end of our second fiscal quarter. As a result of this test, we concluded that the carrying value of our wood reporting unit exceeded its fair value by an amount in excess of the goodwill previously allocated to the reporting unit. Therefore, we recognized a goodwill impairment charge of $1,971 for the year ended November 28, 2020. Our subsequent annual goodwill impairment tests, conducted as of the beginning of our fourth fiscal quarters of 2020, 2021 and 2022, resulted in no additional impairments.

The determination of the fair value of our reporting units is based on a combination of a market approach, that considers benchmark company market multiples, and an income approach, that utilizes discounted cash flows for each reporting unit and other Level 3 inputs as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurements and Disclosure (see Note 4). Under the income approach, we determine fair value based on the present value of the most recent cash flow projections for each reporting unit as of the date of the analysis and calculate a terminal value utilizing a terminal growth rate. The significant assumptions under this approach include, among others: income projections, which are dependent on future sales, new product introductions, customer behavior, competitor pricing, operating expenses, the discount rate, and the terminal growth rate. The cash flows used to determine fair value are dependent on a number of significant management assumptions such as our expectations of future performance and the expected future economic environment, which are partly based upon our historical experience. Our estimates are subject to change given the inherent uncertainty in predicting future results. Additionally, the discount rate and the terminal growth rate are based on our judgment of the rates that would be utilized by a hypothetical market participant. As part of the goodwill impairment testing, we also consider our market capitalization in assessing the reasonableness of the combined fair values estimated for our reporting units.

45

Changes in the carrying amounts of goodwill by reportable segment were as follows:

	Wholesale		Retail			Total
Balance as of November 28, 2020	$	7,217	$	-		$	7,217
No changes in fiscal 2021		-		-			-
Balance as of November 27, 2021		7,217		-			7,217
Acquisition of Noa Home		-		5,715			5,715
Foreign currency translation adjustment		-		(161	)		(161	)
Balance as of November 26, 2022	$	7,217	$	5,554		$	12,771

Accumulated impairment losses were $3,897 at each of November 26, 2022, November 27, 2021 and November 28, 2020.

The weighted average useful lives of our finite-lived intangible assets and remaining amortization periods as of November 26, 2022 are as follows:

	Useful Life in Years		Remaining Amortization Period in Years
Customer relationships		9		4

Our trade name intangible assets are associated with Noa Home and Lane Venture. Because it is our intention to maintain and grow those brands, they are considered to be indefinite-lived intangible assets. The amortization expense associated with finite-lived intangible assets during fiscal 2022, 2021 and 2020 was $57 each year and is included in selling, general and administrative expense in our consolidated statement of operations. All expense arising from the amortization of intangible assets is associated with our wholesale segment. Estimated future amortization expense for intangible assets that exist at November 26, 2022 is as follows:

Fiscal 2023	$	57
Fiscal 2024		57
Fiscal 2025		57
Fiscal 2026		57
Fiscal 2027		4
Total	$	232

9. Bank Credit Facility

Bank Credit Facility

Our bank credit facility provides for a line of credit of up to $25,000. At November 26, 2022, we had $3,931 outstanding under standby letters of credit against our line, leaving availability under our credit line of $21,069. In addition, we had outstanding standby letters of credit with another bank totaling $250 at November 26, 2022. The line bears interest at the One-Month Term Secured Overnight Financing Rate (“One-Month Term SOFR”) plus 1.5% and is unsecured. Our bank charges a fee of 0.25% on the daily unused balance of the line, payable quarterly. Under the terms of the facility, we must maintain the following financial covenants, measured quarterly on a rolling twelve-month basis:

● Consolidated fixed charge coverage ratio of not less than 1.4 times,

● Consolidated lease-adjusted leverage ratio not to exceed 3.0 times, and

● Minimum tangible net worth of $140,000.

We were in compliance with these covenants at November 26, 2022 and expect to remain in compliance for the foreseeable future. The credit facility will mature on January 27, 2025, at which time any amounts outstanding under the facility will be due.

Total interest paid during fiscal 2022, 2021 and 2020 was not material.

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10. Post-Employment Benefit Obligations

Management Savings Plan

On May 1, 2017, our Board of Directors, upon the recommendation of the Organization, Compensation and Nominating Committee (the “Committee”), adopted the Bassett Furniture Industries, Incorporated Management Savings Plan (the “Plan”). The Plan is an unfunded, nonqualified deferred compensation plan maintained for the benefit of certain highly compensated or management level employees.

The Plan is an account-based plan under which (i) participants may defer voluntarily the payment of current compensation to future years (“participant deferrals”) and (ii) the Company may make annual awards to participants payable in future years (“Company contributions”). The Plan permits each participant to defer up to 75% of base salary and up to 100% of any incentive compensation or other bonus, which amounts would be credited to a deferral account established for the participant. Such deferrals will be fully vested at the time of the deferral. Participant deferrals will be indexed to one or more deemed investment alternatives chosen by the participant from a range of alternatives made available under the Plan. Each participant’s account will be adjusted to reflect gains and losses based on the performance of the selected investment alternatives. A participant may receive distributions from the Plan: (1) upon separation from service, in either a lump sum or annual installment payments over up to a 15 year period, as elected by the participant, (2) upon death or disability, in a lump sum, or (3) on a date or dates specified by the participant (“scheduled distributions”) with such scheduled payments made in either a lump sum or substantially equal annual installments over a period of up to five years, as elected by the participant. Participant contributions commenced during the third quarter of fiscal 2017. Company contributions will vest in full (1) on the third anniversary of the date such amounts are credited to the participant’s account, (2) the date that the participant reaches age 63 or (3) upon death or disability. Company contributions are subject to the same rules described above regarding the crediting of gains or losses from deemed investments and the timing of distributions. Expense (credits) associated with deferred compensation under the Plan was $(16), $338 and $264 for fiscal 2022, 2021 and 2020, respectively. Our liability for Company contributions and participant deferrals at November 26, 2022 and November 27, 2021 was $2,070 and $1,789, respectively, and is included in post-employment benefit obligations in our consolidated balance sheets.

On May 2, 2017, we made Long Term Cash Awards (“LTC Awards”) totaling $2,000 under the Plan to certain management employees in the amount of $400 each. The LTC Awards vest in full on the first anniversary of the date of the award if the participant has reached age 63 by that time, or, if later, on the date the participant reaches age 63, provided in either instance that the participant is still employed by the Company at that time. If not previously vested, the awards will also vest immediately upon the death or disability of the participant prior to the participant’s separation from service. The awards will be payable in 10 equal annual installments following the participant’s death, disability or separation from service. We are accounting for the LTC Awards as a defined benefit pension plan. During fiscal 2022, 2021 and 2020, we invested $853, $647 and $609 in life insurance policies covering all participants in the Plan. At November 26, 2022, these policies have a net death benefit of $14,998 for which the Company is the sole beneficiary. These policies are intended to provide a potential source of funds to meet the obligations arising from the deferred compensation and LTC Awards under the Plan and serve as an economic hedge of the financial impact of changes in the liabilities. They are held in an irrevocable trust but are subject to claims of creditors in the event of the Company’s insolvency.

Supplemental Retirement Income Plan

We have an unfunded Supplemental Retirement Income Plan (the “Supplemental Plan”) that covers one current and certain former executives. Upon retirement, the Supplemental Plan provides for lifetime monthly payments in an amount equal to 65% of the participant’s final average compensation as defined in the Supplemental Plan, which is reduced by certain social security benefits to be received and other benefits provided by us. The Supplemental Plan also provides a death benefit that is calculated as (a) prior to retirement death, which pays the beneficiary 50% of final average annual compensation for a period of 120 months, or (b) post-retirement death, which pays the beneficiary 200% of final average compensation in a single payment. We own life insurance policies on these executives with a current net death benefit of $1,587 at November 26, 2022 and we expect to substantially fund this death benefit through the proceeds received upon the death of the executive. Funding for the remaining cash flows is expected to be provided through operations. There are no benefits payable as a result of a termination of employment for any reason other than death or retirement, other than a change of control provision which provides for the immediate vesting and payment of the retirement benefit under the Supplemental Plan in the event of an employment termination resulting from a change of control.

47

Aggregated summarized information for the Supplemental Plan and the LTC Awards, measured as of the end of each year presented, is as follows:

`	2022			2021
Change in Benefit Obligation:
Projected benefit obligation at beginning of year	$	10,740		$	10,071
Service cost		36			120
Interest cost		231			196
Actuarial (gains) and losses		(2,503	)		762
Benefits paid		(1,242	)		(409	)
Projected benefit obligation at end of year	$	7,262		$	10,740
Accumulated Benefit Obligation	$	7,262		$	10,740
Discount rate used to value the ending benefit obligations:		5.38	%		2.25	%
Amounts recognized in the consolidated balance sheet:
Current liabilities	$	698		$	913
Noncurrent liabilities		6,564			9,827
Total amounts recognized	$	7,262		$	10,740
Amounts recognized in accumulated other comprehensive income:
Prior service cost	$	229		$	355
Actuarial (gain) loss		(543	)		2,093
Net amount recognized	$	(314	)	$	2,448
Total recognized in net periodic benefit cost and accumulated other comprehensive income:	$	(2,236	)	$	1,078

	2022			2021			2020
Components of Net Periodic Pension Cost:
Service cost	$	36		$	121		$	172
Interest cost		231			196			268
Amortization of prior service cost		126			126			126
Amortization of other loss		133			59			8
Net periodic pension cost	$	526		$	502		$	574
Assumptions used to determine net periodic pension cost:
Discount rate		2.25	%		2.00	%		2.75	%
Increase in future compensation levels		3.00	%		3.00	%		3.00	%

Estimated Future Benefit Payments (with mortality):
Fiscal 2023	$	698
Fiscal 2024		667
Fiscal 2025		715
Fiscal 2026		683
Fiscal 2027		691
Fiscal 2028 through 2032		3,135

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Of the $314 net gain recognized in accumulated other comprehensive income at November 26, 2022, amounts expected to be recognized as components of net periodic pension cost during fiscal 2023 are as follows:

Prior service cost	$	126
Other loss		(1	)
Total expected to be amortized to net periodic pension cost in 2023	$	125

The components of net periodic pension cost other than the service cost component are included in other loss, net in our consolidated statements of operations.

Deferred Compensation Plan

We have an unfunded Deferred Compensation Plan that covers one current and certain former executives and provides for voluntary deferral of compensation. This plan has been frozen with no additional participants or benefits permitted. We recognized expense of $154, $204, and $176 in fiscal 2022, 2021, and 2020, respectively, associated with the plan. Our liability under this plan was $1,616 and $1,648 as of November 26, 2022 and November 27, 2021, respectively. The non-current portion of this obligation is included in post-employment benefit obligations in our consolidated balance sheets, with the current portion included in accrued compensation and benefits.

Defined Contribution Plan

We have a qualified defined contribution plan (Employee Savings/Retirement Plan) that covers substantially all employees who elect to participate and have fulfilled the necessary service requirements. Employee contributions to the Plan are matched at the rate of 25% of up to 8% of gross pay, regardless of years of service. During fiscal 2020, the Company’s matching contribution was temporarily suspended for approximately six months as part of the cash conservation measures put into place in response to the impact of the COVID-19 pandemic but was resumed during the fourth quarter. Expense for employer matching contributions was $1,108, $1,040 and $548 during fiscal 2022, 2021 and 2020, respectively.

11. Accumulated Other Comprehensive Income (Loss)

The activity in accumulated other comprehensive income (loss) for the fiscal years ended November 26, 2022 and November 27, 2021, which is comprised of post-retirement benefit costs related to our SERP and LTC Awards as well as cumulative translation adjustments arising from our investment in Noa Home, is as follows:

Balance at November 28, 2020	$	(1,394	)
Actuarial losses		(762	)
Net pension amortization reclassified from accumulated other comprehensive loss		186
Tax effects		147
Balance at November 27, 2021		(1,823	)
Actuarial gains		2,503
Net pension amortization reclassified from accumulated other comprehensive loss		256
Foreign currency translation adjustment		(272	)
Tax effects		(614	)
Balance at November 26, 2022	$	50

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12. Capital Stock and Stock Compensation

We account for our stock-based employee and director compensation plans in accordance with ASC 718, Compensation – Stock Compensation. ASC 718 requires recognition of the cost of employee services received in exchange for an award of equity instruments in the financial statements over the period the employee is required to perform the services in exchange for the award (presumptively the vesting period) which we recognize on a straight-line basis. Compensation expense related to restricted stock and stock options included in selling, general and administrative expenses in our consolidated statements of operations for fiscal 2022, 2021 and 2020 was as follows:

	2022		2021		2020
Stock based compensation expense	$	538	$	158	$	420

Incentive Stock Compensation Plans

2021 Plan

On March 10, 2021, our shareholders approved the Bassett Furniture Industries, Incorporated 2021 Stock Incentive Plan (the “2021 Plan”). All present and future non-employee directors, key employees and outside consultants for the Company are eligible to receive incentive awards under the 2021 Plan. Our Organization, Compensation and Nominating Committee (the “OCN Committee”) selects eligible key employees and outside consultants to receive awards under the 2021 Plan in its discretion. Our Board of Directors or any committee designated by the Board of Directors selects eligible non-employee directors to receive awards under the 2021 Plan in its discretion. Five hundred thousand (500,000) shares of common stock are reserved for issuance under the 2021 Plan. Participants may receive the following types of incentive awards under the 2021 Plan: stock options, stock appreciation rights, payment shares, restricted stock, restricted stock units and performance shares. Stock options may be incentive stock options or non-qualified stock options. Stock appreciation rights may be granted in tandem with stock options or as a freestanding award. Non-employee directors and outside consultants are eligible to receive restricted stock and restricted stock units only. The full terms of the 2021 Plan have been filed as an exhibit to our Schedule 14A filed with the United States Securities and Exchange Commission on February 8, 2021.

2010 Plan

On April 14, 2010, our shareholders approved the Bassett Furniture Industries, Incorporated 2010 Stock Incentive Plan which was amended and restated effective January 13, 2016 (the “2010 Plan”). All non-employee directors, key employees and outside consultants for the Company were eligible to receive incentive awards under the 2010 Plan. The 2010 Plan expired in April of 2020 and no additional grants can be awarded under the plan. All remaining unexpired options granted under the 2010 Plan were exercised during fiscal 2021.

The fair value of each option award was estimated on the date of grant using the Black-Scholes option pricing model. The risk free rate is based on the U.S. Treasury rate for the expected life at the time of grant, volatility is based on the average long-term implied volatilities of peer companies, the expected life is based on the estimated average of the life of options using the simplified method. Forfeitures are recognized as they occur. We utilized the simplified method to determine the expected life of our options due to insufficient exercise activity during recent years as a basis from which to estimate future exercise patterns.

Grants of non-vested restricted shares are measured at fair value as if the shares were vested and issued on the grant date. Forfeitures are recognized as they occur. We recognize compensation cost for awards with service only conditions with a graded vesting schedule on a straight-line basis over the longest vesting period.

Stock Options

There were no new grants of options made in 2022, 2021 or 2020.

Additional information regarding activity in our stock options during fiscal 2022, 2021 and 2020 is as follows:

	2022		2021		2020
Total intrinsic value of options exercised	$	-	$	93	$	-
Total cash received from the exercise of options		-		42		-
Excess tax benefits recognized in income tax expense upon the exercise of options		-		18		-

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Restricted Shares

Changes in the outstanding non-vested restricted shares during the year ended November 26, 2022 were as follows:

	Number of Shares			Weighted Average Grant Date Fair Value Per Share
Non-vested restricted shares outstanding at November 27, 2021		10,605		$	21.24
Granted		67,099			16.27
Vested		(10,605	)		21.24
Non-vested restricted shares outstanding at November 26, 2022		67,099		$	16.27

During fiscal 2022, 10,605 restricted shares were vested and released, of which 3,500 shares had been granted to employees and 7,105 shares had been granted to directors. During fiscal 2022, 2021 and 2020, 1,225 shares, 10,850 shares and 14,010 shares, respectively, were withheld to cover withholding taxes of $19, $219 and $228, respectively, arising from the vesting of restricted shares. During fiscal 2022, 2021 and 2020, excess tax benefits (expense) of $1, $(133) and $(114), respectively, were recognized within income tax expense upon the release of vested shares.

Additional information regarding our outstanding non-vested restricted shares at November 26, 2022 is as follows:

					Remaining
	Restricted		Share Value		Restriction
Grant	Shares		at Grant Date		Period
Date	Outstanding		Per Share		(Years)
January 12, 2022		51,300	$	15.82		2.1
March 9, 2022		15,799		17.72		0.3
		67,099

Unrecognized compensation cost related to these non-vested restricted shares at November 26, 2022 is $611, all of which is expected to be recognized in fiscal 2023 and 2024.

Employee Stock Purchase Plan

In March of 2017 we adopted and implemented the 2017 Employee Stock Purchase Plan (“2017 ESPP”) that allows eligible employees to purchase a limited number of shares of our stock at 85% of market value. Under the 2017 ESPP we sold 30,074, 22,547 and 50,217 shares to employees during fiscal 2022, 2021 and 2020, respectively, which resulted in an immaterial amount of compensation expense. There are 102,460 shares remaining available for sale under the 2017 ESPP at November 26, 2022.

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13. Income Taxes

The components of the income tax provision from continuing operations are as follows:

	2022		2021		2020
Current:
Federal	$	5,659	$	4,507	$	(8,233	)
State		2,154		171		148
Deferred:
Federal		484		60		2,067
State		405		1,098		(518	)
Total	$	8,702	$	5,836	$	(6,536	)

On March 27, 2020 the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was signed into law. A major provision of the CARES Act allows net operating losses from the 2018, 2019 and 2020 tax years to be carried back up to five years. As a result, for the year ended November 28, 2020 we were able to recognize tax benefits substantially in excess of the current federal statutory rate of 21% due to the effects of carrying back our current net operating loss to tax years in which the federal statutory rate was 35%.

A reconciliation of the statutory federal income tax rate and the effective income tax rate, as a percentage of income before income taxes, is as follows:

	2022			2021			2020
Statutory federal income tax rate		21.0	%		21.0	%		21.0	%
Adjustments to state net operating CARES Act benefit		-			-			19.2
State income tax, net of federal benefit		4.4			4.2			1.7
Impairment of non-deductible goodwill		-			-			(2.5	)
Excess tax from stock-based compensation		-			0.4			(0.6	)
Other		0.1			(0.1	)		(2.5	)
Effective income tax rate		25.5	%		25.5	%		36.3	%

Excess tax benefits (expense) in the amount of $1, $(115) and $(114) were recognized as a component of income tax expense during fiscal 2022, 2021 and 2020, respectively, resulting from the exercise of stock options and the release of restricted shares. The fiscal 2020 adjustment for impairment of non-deductible goodwill reflect the fact that there was no tax basis related to the impaired goodwill.

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The income tax effects of temporary differences and carryforwards, which give rise to significant portions of the deferred income tax assets and deferred income tax liabilities, are as follows:

	November 26, 2022			November 27, 2021
Deferred income tax assets:
Trade accounts receivable	$	315		$	199
Inventories		3,782			3,121
Notes receivable		-			44
Post employment benefit obligations		2,734			3,562
State net operating loss carryforwards		9			153
Foreign net operating loss carryforwards		1,339			-
Operating lease liabilities		29,423			34,813
Other		1,713			1,180
Gross deferred income tax assets		39,315			43,072
Valuation allowance		(1,339	)		-
Total deferred income tax assets		37,976			43,072
Deferred income tax liabilities:
Property and equipment		5,532			7,013
Intangible assets		726			1,712
Operating lease assets		25,166			29,758
Prepaid expenses and other		1,024			1,400
Total deferred income tax liabilities		32,448			39,883
Net deferred income tax assets	$	5,528		$	3,189

We have state net operating loss carryforwards available to offset future taxable state income of $238, which expire in varying amounts between 2030 and 2040. Realization is dependent on generating sufficient taxable income prior to expiration of the loss carryforwards. We also have foreign net operating loss carryforwards attributable to Noa Home (see Note 3) of $5,357, substantially all of which related to pre-acquisition losses, resulting in a deferred tax asset of $1,339 upon which we have placed a full valuation allowance.

Income taxes paid, net of refunds received, during fiscal 2022, 2021 and 2020 were $20,176, $3,092, and $539, respectively.

We regularly evaluate, assess and adjust our accrued liabilities for unrecognized tax benefits in light of changing facts and circumstances, which could cause the effective tax rate to fluctuate from period to period. Our liabilities for uncertain tax positions are not material.

Significant judgment is required in evaluating the Company's federal and state tax positions and in the determination of its tax provision. Despite our belief that the liability for unrecognized tax benefits is adequate, it is often difficult to predict the final outcome or the timing of the resolution of any particular tax matter. We may adjust these liabilities as relevant circumstances evolve, such as guidance from the relevant tax authority, or resolution of issues in the courts. These adjustments are recognized as a component of income tax expense in the period in which they are identified. The Company also cannot predict when or if any other future tax payments related to these tax positions may occur.

We remain subject to examination for tax years 2019 through 2022 for all of our major tax jurisdictions.

14. Other Gains and Losses

Gains on Dispositions of Retail Store Locations

During the third quarter of fiscal 2022, we sold one of our Company-owned store locations in Houston, Texas for $8,217 net of closing costs, resulting in a gain of $4,595 during the year ended November 26, 2022. This store will be relocated to a new leased store in the Houston market that we expect to open during the third quarter of fiscal 2023 (see Note 15).

This sale, together with our purchase of real property in Tampa, Florida for $7,668 in cash during the second quarter of fiscal 2022 will be treated as an exchange of like-kind property under Section 1031 of the Internal Revenue Code of 1986, as amended, for the purpose of deferring approximately $4,300 of the taxable gain arising from the sale of the Houston property. A VIE was established during the second quarter of fiscal 2022 for purposes of acquiring the Tampa, Florida property, of which the Company was the primary beneficiary by virtue of our control over the activities that most significantly impact the entity's economic performance. Subsequent to the completion of the exchange transactions during the third quarter of fiscal 2022, the sole equity interest in the VIE was transferred to Bassett and the entity is now consolidated as a wholly owned subsidiary We plan to remodel the Tampa property and open as a Company-owned store in the third quarter of fiscal 2023.

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Selling, general and administrative expenses for the year ended November 28, 2020 include gains totaling $1,313 resulting from the settlement of lease obligations due to the early termination of leases at our retail store locations in Torrance, California and Culver City, California.

Asset Impairment Charges and Lease Exit Costs

During fiscal 2020 we recorded $11,114 of non-cash impairment charges on the assets of five underperforming retail stores, including $6,239 for the impairment of operating lease right-of-use assets associated with the leased locations. Also in fiscal 2020 we incurred $1,070 of non-cash impairment charges in our wholesale segment, primarily due to the closing of our custom upholstery manufacturing facility in Grand Prairie, Texas, in May.

Litigation Expense

During fiscal 2020 we accrued $1,050 for the estimated costs to resolve certain wage and hour violation claims that had been asserted against the Company.

Gains from Company-Owned Life Insurance

Other loss, net for the fiscal 2022 and 2020 includes gains of $1,441 and $914, respectively, arising from death benefits from Company-owned life insurance.

15. Leases and Lease Guarantees

Leases

Effective as of the beginning of fiscal 2020, we adopted ASU 2016-02, Leases (Topic 842) and all related amendments. See “Leases” under Note 2 for a discussion of our accounting policies and elections under Topic 842 as well as the impact of the adoption upon our financial statements.

Supplemental balance sheet information related to our leases as of November 26, 2022 and November 27, 2021 is as follows:

	November 26, 2022		November 27, 2021
Operating leases:
Right of use assets	$	99,472	$	95,955
Lease liabilties, short-term		18,819		20,235
Lease liabilties, long-term		97,477		94,845
Finance leases:
Right of use assets (1)	$	623	$	832
Lease liabilties, short-term (2)		282		254
Lease liabilties, long-term (3)		360		588

(1) Included in property & equipment, net in our consolidated balance sheet.

(2) Included in other current liabilites and accrued expenses in our consolidated balance sheet.

(3) Included in other long-term liabilites and accrued expenses in our consolidated balance sheet.

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Our right-of-use assets under operating leases by segment as of November 26, 2022 and November 27, 2021 are as follows:

	November 26, 2022		November 27, 2021
Wholesale	$	8,183	$	9,842
Retail		91,289		86,113
Total right of use assets	$	99,472	$	95,955

The components of our lease cost for 2022, 2021 and 2020 were as follows:

	2022			2021			2020
Lease cost:
Operating lease cost	$	24,399		$	24,367		$	24,946
Financing lease cost:
Amortization of right-of-use assets		279			95			-
Interest on lease liabilities		35			15			-
Short-term lease cost		674			387			545
Variable lease cost (net of abatements received)		447			277			(605	)
Sublease income		(1,444	)		(1,292	)		(1,557	)
Total lease cost	$	24,390		$	23,849		$	23,329

Supplemental lease disclosures as of November 26, 2022, November 27, 2021 and November 28, 2020 and for the fiscal years then ended are as follows:

	Operating			Financing
For the year ended November 28, 2020:
Cash paid for amounts included in the measurements of lease liabilities	$	27,011		$	-
Lease liabilities arising from new right-of-use assets		8,541			-
For the year ended November 27, 2021:
Cash paid for amounts included in the measurements of lease liabilities		26,842			103
Lease liabilities arising from new right-of-use assets		15,678			927
For the year ended November 26, 2022:
Cash paid for amounts included in the measurements of lease liabilities		26,913			302
Lease liabilities arising from new right-of-use assets		23,171			73
As of November 28, 2020:
Weighted average remaining lease terms (years)		6.4			-
Weighted average discount rates		5.00	%		-
As of November 27, 2021:
Weighted average remaining lease terms (years)		6.3			3.2
Weighted average discount rates		5.07	%		4.63	%
As of November 26, 2022:
Weighted average remaining lease terms (years)		6.2			2.3
Weighted average discount rates		5.53	%		4.68	%

55

Future payments under our leases and the present value of the obligations as of November 26, 2022 are as follows:

	Operating Leases		Financing Leases
Fiscal 2023	$	24,670	$	319
Fiscal 2024		24,458		256
Fiscal 2025		23,172		94
Fiscal 2026		20,506		5
Fiscal 2027		16,222		2
Thereafter		28,839		-
Total lease payments		137,867		676
Less: interest		21,571		34
Total lease obligations	$	116,296	$	642

As of November 26, 2022, we had a commitment to lease 9,597 square feet of retail space located at Post Oak Plaza in Houston, Texas. This space will be used for the relocation of a former retail store in the Houston market that was sold in 2022 (see Note 14). The initial term of the lease is ten years and calls for average monthly rents of $36. The lease has three successive five-year renewal options. We expect to occupy the premises during the first quarter of fiscal 2023 and open the store in the third quarter. We also have commitments to lease 61,182 square feet of retail warehouse space near Dallas, Texas and Columbus, Ohio. These leases each have a five-year terms with combined average monthly rents of $41. We expect to occupy these spaces during the first quarter of 2023.

We sublease a small number of our leased locations to certain of our licensees for operation as BHF network stores. The terms of these leases generally match those of the lease we have with the lessor. In addition, we sublease space in certain closed store locations that are still under lease. Minimum future lease payments due to us under these subleases are as follows:

Fiscal 2023	$	1,289
Fiscal 2024		879
Fiscal 2025		599
Fiscal 2026		156
Fiscal 2027		-
Thereafter		-
Total minimum future rental income	$	2,923

During fiscal 2020, we negotiated with a number of our landlords to obtain relief in the form of rent deferrals or abatements of rent as a result of the effects of COVID-19 on our business. The remaining balance of deferred rent at November 26, 2022 and November 27, 2021 was not material. In accordance with FASB Staff Q&A - Topic 842 and Topic 840: Accounting for Lease Concessions Related to the Effects of the COVID-19 Pandemic ("FASB Staff Q&A") issued in April 2020, we elected to account for any lease concessions resulting directly from COVID-19 as if the enforceable rights and obligations for the concessions existed in the respective contracts at lease inception and as such we will not account for any concession as a lease modification. Guidance from the FASB Staff Q&A provided methods to account for rent deferrals which include the option to treat the lease as if no changes to the lease contract were made or to treat deferred payments as variable lease payments. The FASB Staff Q&A allows entities to select the most practical approach and does not require the same approach be applied consistently to all leases. As a result, we accounted for the deferrals as if no changes to the lease contract were made and will continue to recognize lease expense, on a straight-line basis, during the deferral period. For any abatements received, we accounted for those as variable rent in the period in which the abatement is granted. For the year ended November 28, 2020, we were granted abatements against rent totaling $775.

Guarantees

As part of the strategy for our store program, we have guaranteed certain lease obligations of licensee operators. Lease guarantees range from one to five years. We were contingently liable under licensee lease obligation guarantees in the amount of $1,880 and $1,845 at November 26, 2022 and November 27, 2021, respectively.

In the event of default by an independent dealer under the guaranteed lease, we believe that the risk of loss is mitigated through a combination of options that include, but are not limited to, arranging for a replacement dealer, liquidating the collateral, and pursuing payment under the personal guarantees of the independent dealer. The proceeds of the above options are estimated to cover the maximum amount of our future payments under the guarantee obligations, net of reserves. The fair value of lease guarantees (an estimate of the cost to the Company to perform on these guarantees) at November 26, 2022 and November 27, 2021, were not material.

56

16. Contingencies

We are involved in various claims and actions which arise in the normal course of business. Although the final outcome of these matters cannot be determined, based on the facts presently known, it is our opinion that the final resolution of these matters will not have a material adverse effect on our financial position or future results of operations.

17. Earnings (Loss) Per Share

The following table sets forth the computation of basic and diluted earnings (loss) per share:

	2022		2021		2020
Earnings per share - continuing operations:
Numerator:
Net income (loss) from continuing operations	$	25,360	$	16,921	$	(11,477	)
Denominator:
Denominator for basic income per share - weighted average shares		9,394,873		9,835,829		9,969,616
Effect of dilutive securities*		8,107		7,945		-
Denominator for diluted income per share — weighted average shares and assumed conversions		9,402,980		9,843,774		9,969,616
Basic income (loss) per share - continuing operations:	$	2.70	$	1.72	$	(1.15	)
Diluted income (loss) per share - continuing operations	$	2.70	$	1.72	$	(1.15	)
Earnings per share - discontinued operations:
Numerator:
Net income from discontinued operations	$	39,985	$	1,121	$	1,056
Denominator:
Denominator for basic income per share - weighted average shares		9,394,873		9,835,829		9,969,616
Effect of dilutive securities*		8,107		7,945		-
Denominator for diluted income per share — weighted average shares and assumed conversions		9,402,980		9,843,774		9,969,616
Basic income per share - discontinued operations	$	4.26	$	0.11	$	0.11
Diluted income per share - discontinued operations	$	4.26	$	0.11	$	0.11

*Due to the net losses in 2020, the potentially dilutive securities would have been anti-dilutive and are therefore excluded.

For fiscal 2022, 2021 and 2020, the following potentially dilutive shares were excluded from the computations as their effect was anti-dilutive:

	2022		2021		2020
Unvested restricted shares		-		-		90,153
Stock options		-		-		5,250

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18. Discontinued Operations

On January 31, 2022, we entered into a definitive agreement to sell substantially all of the assets of Zenith to J.B. Hunt. The sale was completed on February 28, 2022, at which time we received the following net proceeds:

Sales price prior to post-closing working capital adjustment	$	86,939
Less:
Amount held in escrow for contingencies related to representations and warranties (1)		1,000
Seller expenses paid at closing		418
Working capital adjustment paid to buyer		987
Net proceeds from the sale (2)	$	84,534

(1) To be held in escrow until the first anniversary of the sale, at which time any amount not distributed or reserved for specified claims will be released to the Company. This amount is included in other current assets in the accompanying condensed consolidated balance sheet at November 26, 2022.

(2) Included in cash flows from investing activities in the accompanying condensed consolidated statement of cash flows for the year ended November 26, 2022.

The sales price was subject to customary post-closing working capital adjustments which were paid during the second half of fiscal 2022 and resulted in a pre-tax gain from the sale of Zenith of $52,534.

The operations of our logistical services segment, which consisted entirely of the operations of Zenith, are presented in the accompanying consolidated statements of operations as discontinued operations, and the assets sold to and liabilities assumed by J.B. Hunt are presented in the accompanying consolidated balance sheet as assets and liabilities of discontinued operations held for sale as of November 27, 2021.

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The following table summarizes the major classes of assets and liabilities of the discontinued operations held for sale as reported in the condensed consolidated balance sheet as of November 27, 2021:

	November 27, 2021
Carrying amounts of major classes of assets included as part of discontinued operations:
Accounts receivable, net	$	7,601
Other current assets		3,463
Property and equipment, net		24,898
Goodwill and other intangible assets		9,094
Right of use assets under operating leases		18,193
Other		572
	$	63,821
Balance sheet classification:
Current assets of discontinued operations held for sale	$	11,064
Long-term assets of discontinued operations held for sale		52,757
Total assets of discontinued operations held for sale	$	63,821
Carrying amounts of major classes of liabilities included as part of discontinued operations:
Accounts payable	$	4,336
Accrued compensation and benefits		3,295
Current portion operating lease obligations		7,458
Other current liabilites and accrued expenses		1,006
Long-term portion of operating lease obligations		10,996
Other long-term liabilities		5,214
	$	32,305
Balance sheet classification:
Current liabilities of discontinued operations held for sale	$	16,095
Long-term liabilities of discontinued operations held for sale		16,210
Total liabilities of discontinued operations held for sale	$	32,305

Following the sale of Zenith, certain of Zenith’s liabilities primarily representing reserves and accrued liabilities for pre-disposal workers’ compensation, health insurance and auto liability claims were retained by Bassett. The remaining balance of these reserves and accruals total $639 at November 26, 2022 and are included in other current liabilities and accrued expenses in the accompanying condensed consolidated balance sheet.

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The following table summarizes the major classes of line items constituting income of the discontinued operations, as reported in the consolidated statements of operations for fiscal 2022, 2021 and 2020:

	2022			2021			2020
Major line items constituting pretax income of discontinued operations:
Logistical services revenue	$	16,776		$	55,648		$	48,191
Cost of logistical services		15,001			53,905			46,910
Other loss, net		(63	)		(260	)		(54	)
Income from operations of logistical services		1,712			1,483			1,227
Gain on disposal		52,534			-			-
Pretax income of discontinued operations		54,246			1,483			1,227
Income tax expense		14,261			362			171
Income from discontinued operations, net of tax	$	39,985		$	1,121		$	1,056

The amounts for revenue and costs of logistical services shown above represent the results of Zenith’s business transactions with third parties. Zenith also charged Bassett for logistical services provided to our wholesale segment in the amount of $9,121 during 2022 prior to disposal, and $31,329 and $26,967, for all of 2021 and 2020, respectively. We have entered into a service agreement with J.B. Hunt for the continuation of these services for a period of seven years following the sale of Zenith. Subsequent to the sale, we incurred $27,604 of expense during 2022 for the performance of logistical services, of which $26,065 had been paid in cash as of November 26, 2022.

Included in other loss, net, is interest arising from finance leases assumed by J.B. Hunt as part of the transaction. Such interest amounted to $78, $289 and $49, for 2022, 2021 and 2020, respectively.

The following table summarizes the cash flows generated by discontinued operations during 2022, 2021 and 2020:

	2022 (1)			2021			2020
Cash provided by operating activities	$	1,681		$	4,082		$	5,536
Cash used in investing activities		(81	)		(4,508	)		(2,900	)
Cash used in financing activities		(371	)		(1,259	)		(121	)
Net cash provided by (used in) discontinued operations	$	1,229		$	(1,685	)	$	2,515

(1) Excludes net proceeds from the sale of Zenith.

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19. Segment Information

We have strategically aligned our business into two reportable segments as defined in ASC 280, Segment Reporting, and as described below:

● Wholesale. The wholesale home furnishings segment is involved principally in the design, manufacture, sourcing, sale and distribution of furniture products to a network of Bassett stores (Company-owned and licensee-owned stores retail stores) and independent furniture retailers. Our wholesale segment includes our wood and upholstery operations as well as all corporate selling, general and administrative expenses, including those corporate expenses related to both Company- and licensee-owned stores. Our wholesale segment also includes our holdings of short-term investments and retail real estate previously leased as licensee stores. The earnings and costs associated with these assets are included in other loss, net, in our consolidated statements of operations.

● Retail – Company-owned stores. Our retail segment consists of Company-owned stores and includes the revenues, expenses, assets and liabilities and capital expenditures directly related to these stores and the Company-owned distribution network utilized to deliver products to our retail customers. The retail segment also includes the operations and net assets of Noa Home since the acquisition on September 2, 2022.

Inter-company sales elimination represents the elimination of wholesale sales to our Company-owned stores. Inter-company income elimination includes the embedded wholesale profit in the Company-owned store inventory that has not been realized. These profits will be recorded when merchandise is delivered to the retail consumer. The inter-company income elimination also includes rent paid by our retail stores occupying Company-owned real estate.

Our former logistical services segment which represented the operations of Zenith is now presented as a discontinued operation in the accompanying condensed consolidated balances sheets and statements of income (see Note 18).

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The following table presents segment information for each of the last three fiscal years:

	2022			2021			2020
Sales Revenue
Wholesale sales of furniture and accessories	$	324,569		$	295,329		$	221,075
Less: Sales to retail segment		(125,889	)		(112,270	)		(95,347	)
Wholesale sales to external customers		198,680			183,059			125,728
Retail sales of furniture and accessories		286,921			247,827			211,944
Consolidated net sales of furniture and accessories	$	485,601		$	430,886		$	337,672
Income (loss) from Operations
Wholesale	$	9,286		$	17,490		$	4,587
Retail		21,508			7,044			(9,497	)
Inter-company elimination		(524	)		(277	)		2,610
Asset impairment charges		-			-			(12,184	)
Goodwill impairment charge		-			-			(1,971	)
Litigation expense		-			-			(1,050	)
Gain on sale of real estate		4,595			-			-
Consolidated income from operations	$	34,865		$	24,257		$	(17,505	)
Depreciation and Amortization
Wholesale	$	4,293		$	3,386		$	3,125
Retail		5,750			6,580			6,578
Discontinued operations		1,266			4,631			3,777
Consolidated	$	11,309		$	14,597		$	13,480
Capital Expenditures
Wholesale	$	10,748		$	5,943		$	2,434
Retail		10,548			299			695
Consolidated	$	21,296		$	6,242		$	3,129
Identifiable Assets
Wholesale	$	215,748		$	196,910		$	180,235
Retail		190,525			160,929			169,105
Discontinued operations		-			63,821			53,209
Consolidated	$	406,273		$	421,660		$	402,549

See Note 20 for disaggregated revenue information regarding sales of furniture and accessories by product type for the wholesale and retail segments.

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20. Revenue Recognition

Disaggregated revenue information for sales of furniture and accessories by product category for fiscal years 2022, 2021 and 2020, excluding intercompany transactions between our segments, is as follows:

	2022						2021						2020
	Wholesale		Retail (2)		Total		Wholesale		Retail		Total		Wholesale		Retail		Total
Bassett Custom Upholstery	$	124,565	$	163,755	$	288,320	$	105,445	$	139,527	$	244,972	$	71,840	$	112,888	$	184,728
Bassett Leather		35,953		1,707		37,660		36,157		226		36,383		20,487		2,326		22,813
Bassett Custom Wood		22,534		43,208		65,742		24,079		30,931		55,010		19,682		28,942		48,624
Bassett Casegoods		15,628		40,146		55,774		17,378		42,658		60,036		13,719		35,728		49,447
Accessories, mattresses and other (1)		-		38,105		38,105		-		34,485		34,485		-		32,060		32,060
Consolidated Furniture and Accessories revenue	$	198,680	$	286,921	$	485,601	$	183,059	$	247,827	$	430,886	$	125,728	$	211,944	$	337,672

(1) Includes the sale of goods other than Bassett-branded products, such as accessories and bedding, and also includes the sale of furniture protection plans.

(2) Beginning with the fourth quarter of fiscal 2022, our retail segment includes the sales of Noa Home, which was acquired on September 2, 2022 (see Note 3).

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

As of the end of the period covered by this Annual Report on Form 10-K, our principal executive officer and principal financial officer have evaluated the effectiveness of our “disclosure controls and procedures” (“Disclosure Controls”). Disclosure Controls, as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are procedures that are designed to provide reasonable assurance that information required to be disclosed in our reports filed under the Exchange Act, such as this Annual Report, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure Controls are also designed with the objective of ensuring that such information is accumulated and communicated to our management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure. Our management, including the CEO and CFO, does not expect that our Disclosure Controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Based upon their controls evaluation, our CEO and CFO have concluded that our Disclosure Controls are effective at a reasonable assurance level.

We are responsible for establishing and maintaining adequate internal control over financial reporting in accordance with Exchange Act Rule 13a-15. With the participation of our CEO and CFO, our management conducted an evaluation of the effectiveness of our internal control over financial reporting as of November 26, 2022 based on the criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. The scope of our efforts to comply with Section 404 of the Sarbanes-Oxley Act with respect to fiscal 2022 included all of our operations other than those we acquired in fiscal 2022 related to the acquisition of Noa Home Inc. (“Noa Home”). In accordance with the SEC’s published guidance, because we acquired the operations of Noa Home during the fiscal year, we excluded these operations from our efforts to comply with Section 404 Rules with respect to fiscal 2022. Total assets as of November 26, 2022 and total revenues for the year ending November 26, 2022 for Noa Home were not material. SEC rules require that we complete our assessment of the internal control over financial reporting of the acquisition within one year after the date of the acquisition. Based on this evaluation, excluding the operations of Noa Home discussed above, management concluded that our internal control over financial reporting was effective as of November 26, 2022, based on those criteria. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected.

Ernst & Young LLP, the Company’s independent registered public accounting firm, has issued an attestation report on the effectiveness of the Company’s internal control over financial reporting.

Changes in internal control over financial reporting.

There have been no changes in our internal controls over financial reporting during our fourth fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

64

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of Bassett Furniture Industries, Incorporated and Subsidiaries

Opinion on Internal Control over Financial Reporting

We have audited Bassett Furniture Industries, Incorporated and Subsidiaries’ internal control over financial reporting as of November 26, 2022, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), (the COSO criteria). In our opinion, Bassett Furniture Industries, Incorporated and Subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of November 26, 2022, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of November 26, 2022 and November 27, 2021, and the related consolidated statements of operations, comprehensive income (loss), stockholders' equity, and cash flows for each of the three years in the period ended November 26, 2022, and the related notes and schedule and our report dated January 24, 2023 expressed an unqualified opinion thereon.

As indicated in the accompanying Item 9a Controls and Procedures, management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of Noa Home Inc., which is included in the 2022 consolidated financial statements of the Company and constituted 0.7% and 0.3% of total and net assets, respectively, as of November 26, 2022. Our audit of internal control over financial reporting of the Company also did not include an evaluation of the internal control over financial reporting of Noa Home Inc.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Ernst & Young LLP

Richmond, Virginia

January 24, 2023

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ITEM 9B. OTHER INFORMATION

None.

ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The information to be contained in the Proxy Statement under the captions “Election of Directors” and “Board and Board Committee Information,” is incorporated herein by reference thereto. Please see section entitled “Information about our Executive Officers” in Item 4B of Part I of this report for information concerning executive officers.

The Registrant has a code of ethics that applies to all of its employees, officers and directors. The code of ethics is available on the Registrant’s website at www.bassettfurniture.com and the Registrant will post any amendments to, or waivers, from, the code of ethics on that website.

ITEM 11. EXECUTIVE COMPENSATION

The information to be contained in the Proxy Statement under the captions “Organization, Compensation and Nominating Committee Report,” “Compensation Discussion and Analysis,” “Executive Compensation,” and “Director Compensation” is incorporated herein by reference thereto.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information to be contained in the Proxy Statement under the headings “Principal Stockholders and Holdings of Management” and “Equity Compensation Plan Information” is incorporated herein by reference thereto.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information to be contained in the Proxy Statement under the captions “Board and Board Committee Information” and “Other Transactions” is incorporated herein by reference thereto.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

The information to be contained in the Proxy Statement under the caption “Audit and Other Fees” is incorporated herein by reference thereto.

66

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)	(1)	Bassett Furniture Industries, Incorporated and Subsidiaries Audited Consolidated Financial Statements for the years ended November 26, 2022, November 27, 2021 and November 28, 2020; Report of Ernst & Young LLP, Independent Registered Public Accounting Firm (PCAOB ID 42); Report of Ernst & Young LLP, Independent Registered Public Accounting Firm, on Internal Control Over Financial Reporting (PCAOB ID 42)
	(2)	Financial Statement Schedule:
		Schedule II- Analysis of Valuation and Qualifying Accounts for the years ended November 26, 2022, November 27, 2021 and November 28, 2020
	(3)	Listing of Exhibits

3A.	Articles of Incorporation as amended are incorporated herein by reference to Form 10-Q for the fiscal quarter ended February 28, 1994.
3B.	By-laws as amended to date are incorporated herein by reference to Exhibit 3.1 to Form 8-K filed with the SEC on November 23, 2022.
4A.	Seventh Amended and Restated Credit Agreement with Truist Bank dated January 27, 2022 is incorporated herein by reference to Exhibit 4A to Form 10-K filed with the SEC on January 31, 2022. Registrant hereby agrees to furnish the SEC, upon request, other instruments defining the rights of holders of long-term debt of the Registrant.
4B.	Description of Capital Stock is incorporated herein by reference to Form 10-K for the fiscal year ended November 30, 2019, filed January 23, 2020.
10A.	Asset Purchase Agreement dated January 31, 2022 by and among Bassett Furniture Industries, Incorporated, Zenith Freight Lines, LLC and J.B. Hunt Transport, Inc. is incorporated herein by reference to Exhibit 2.1 to Form 8-K filed with the SEC on February 1, 2022.
*10B.	Bassett Executive Deferred Compensation Plan is incorporated herein by reference to Form 10-K for the fiscal year ended November 30, 1997.
*10C.	Bassett Supplemental Retirement Income Plan is incorporated herein by reference to Form 10-K for the fiscal year ended November 30, 1997.
*10K.	Bassett Furniture Industries, Incorporated 2021 Stock Incentive Plan incorporated by reference to Schedule 14A filed on February 8, 2021
*10L.	Form of Performance Share Award Agreement, Restricted Stock Award Agreement and Stock Option Award Agreement under the Bassett Furniture Industries, Incorporated 2021 Stock Incentive Plan is incorporated herein by reference to Exhibit 10.L to Form 10-K filed with the SEC on January 31, 2022.
*10M.	Schedule of Terms for Employment Continuity Agreements with Certain Executive Officers is incorporated herein by reference to Exhibit 10M to Form 10-K filed with the SEC on January 31, 2022.
*10N.	Restated Supplemental Retirement Income Plan, effective May 1, 2014, is incorporated herein by reference to Form 10-Q for the quarterly period ended May 31, 2014.
*10O.	Bassett Furniture Industries, Incorporated Management Savings Plan incorporated by reference to Exhibit 10.1 to Form 8-K filed with the SEC on May 5, 2017.
*10P.	Form of Long Term Cash Award under Bassett Furniture Industries, Incorporated Management Savings Plan incorporated by reference to Exhibit 10.2 to Form 8-K filed with the SEC on May 5, 2017.
*10Q.	Form of Indemnity Agreement incorporated by reference to Exhibit 10.1 to Form 8-K filed with the SEC on October 18, 2022.

67

21.	List of subsidiaries of the Registrant
23A.	Consent of Independent Registered Public Accounting Firm
31A.	Certification of Robert H. Spilman, Jr., President and Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31B.	Certification of J. Michael Daniel, Senior Vice President and Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32A.	Certification of Robert H. Spilman, Jr., President and Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32B.	Certification of J. Michael Daniel, Senior Vice President and Chief Financial Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	Inline XBRL Instance
101.SCH	Inline XBRL Taxonomy Extension Schema
101.CAL	Inline XBRL Taxonomy Extension Calculation
101.DEF	Inline XBRL Taxonomy Extension Definition
101.LAB	Inline XBRL Taxonomy Extension Labels
101.PRE	Inline XBRL Taxonomy Extension Presentation
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

*         Management contract or compensatory plan or arrangement of the Company.

ITEM 16. FORM 10-K SUMMARY

None.

68

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

BASSETT FURNITURE INDUSTRIES, INCORPORATED (Registrant)

By:	/s/ Robert H. Spilman, Jr.	Date: January 24, 2023
	Robert H. Spilman, Jr. President and Chief Executive Officer Chairman of the Board of Directors

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/ Emma S. Battle	Date: January 24, 2023
	Emma S. Battle Director
By:	/s/ John R. Belk	Date: January 24, 2023
	John R. Belk Director
By:	/s/ Kristina K. Cashman	Date: January 24, 2023
	Kristina K. Cashman Director
By:	/s/ Virginia W. Hamlet	Date: January 24, 2023
	Virginia W. Hamlet Director
By:	/s/ J. Walter McDowell	Date: January 24, 2023
	J. Walter McDowell Director
By:	/s/ William C. Wampler, Jr.	Date: January 24, 2023
	William C. Wampler, Jr. Director
By:	/s/ William C. Warden, Jr.	Date: January 24, 2023
	William C. Warden, Jr. Director, Lead Independent Director
By:	/s/ J. Michael Daniel	Date: January 24, 2023
	J. Michael Daniel Senior Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)

69

Bassett Furniture Industries, Incorporated

Schedule II

Analysis of Valuation and Qualifying Accounts

For the Years Ended November 26, 2022, November 27, 2021 and November 28, 2020

(amounts in thousands)

	Balance Beginning of Period		Additions Charged to Cost and Expenses			Deductions (1)			Other		Balance End of Period
For the Year Ended November 28, 2020:
Reserve deducted from assets to which it applies
Allowance for doubtful accounts	$	725	$	329		$	(149	)	$	-	$	905
Notes receivable valuation reserves	$	359	$	-		$	-		$	-	$	359
For the Year Ended November 27, 2021:
Reserve deducted from assets to which it applies
Allowance for doubtful accounts	$	905	$	(161	)	$	(177	)	$	-	$	567
Notes receivable valuation reserves	$	359	$	-		$	-		$	-	$	359
For the Year Ended November 26, 2022:
Reserve deducted from assets to which it applies
Allowance for doubtful accounts	$	567	$	761		$	(67	)	$	-	$	1,261
Notes receivable valuation reserves	$	359	$	-		$	(359	)	$	-	$	-
Income tax valuation allowance	$	-	$	1,339		$	-		$	-	$	1,339

(1) Deductions are for the purpose for which the reserve was created.

EX-21

Exhibit 21.

EXHIBIT 21 - LIST OF SUBSIDIARIES*

(a) Bassett Furniture Industries of North Carolina, LLC (North Carolina limited liability company)

(b) The E.B. Malone Corporation (Delaware corporation)

(c) Bassett Direct Stores, LLC (Virginia limited liability company)

(d) Bassett Direct NC, LLC (Virginia limited liability company)

(e) Bassett Direct SC, LLC (Virginia limited liability company)

(f) LRG Furniture, LLC (Virginia limited liability company)

(g) BDP, LC (Texas limited liability company)

(h) BFD-Atlanta, LLC (Virginia limited liability company)

(i) BD Boston, LLC (Virginia limited liability company)

(j) BDU NY, LLC (Virginia limited liability company)

(k) JMD Freight Lines, LLC (North Carolina limited liability company)

(l) Zenith, Inc. (North Carolina corporation)

(m) Western States Distribution, LLC (California limited liability company)

(n) 9473-8408 Quebec Inc.

(o) Noa Australia Pty Ltd.

(p) Noa Home Singapore Pte Ltd.

(q) Noa Home UK Limited

(r) JMD Tampa, LLC

*All subsidiaries are wholly-owned unless otherwise noted.

EX-23.A

EXHIBIT 23A

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the following Registration Statements:

(1) Registration Statement (Form S-8 No 333-217072) pertaining to the Bassett Furniture Industries, Incorporated 2017 Employee Stock Purchase Plan , and

(2) Registration Statement (Form S-8 No 333-254104) pertaining to the Bassett Furniture Industries, Incorporated 2021 Stock Incentive Plan

of our reports dated January 24, 2023 with respect to the consolidated financial statements and schedule of Bassett Furniture Industries, Incorporated and Subsidiaries and the effectiveness of internal control over financial reporting of Bassett Furniture Industries, Incorporated and Subsidiaries included in this Annual Report (Form 10-K) of Bassett Furniture Industries, Incorporated and Subsidiaries for the year ended November 26, 2022.

/s/ Ernst & Young LLP

Richmond, Virginia

January 24, 2023

EX-31.A

Exhibit 31A

CERTIFICATIONS

I, Robert H. Spilman, Jr., certify that:

1. I have reviewed this annual report on Form 10-K of Bassett Furniture Industries, Incorporated;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

January 24, 2023

/s/  Robert H. Spilman, Jr.         

Robert H. Spilman, Jr.

President and Chief Executive Officer

EX-31.B

Exhibit 31B

CERTIFICATIONS

I, J. Michael Daniel, certify that:

1. I have reviewed this annual report on Form 10-K of Bassett Furniture Industries, Incorporated;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

January 24, 2023

/s/  J. Michael Daniel                                  

J. Michael Daniel

Senior Vice President and Chief Financial Officer

EX-32.A

Exhibit 32A

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Bassett Furniture Industries, Incorporated (the “Company”) on Form 10-K for the period ended November 26, 2022, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Robert H. Spilman, Jr., Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. ss.1350, as adopted pursuant to ss.906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

January 24, 2023

/s/  Robert H. Spilman, Jr.               

Robert H. Spilman, Jr.

President and Chief Executive Officer

A signed original of this written statement required by Section 906 has been provided to Bassett Furniture Industries, Incorporated and will be retained by Bassett Furniture Industries, Incorporated and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.B

Exhibit 32B

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Bassett Furniture Industries, Incorporated (the “Company”) on Form 10-K for the period ended November 26, 2022, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, J. Michael Daniel, Senior Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. ss.1350, as adopted pursuant to ss.906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Sections 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

January 24, 2023

/s/  J. Michael Daniel              

J. Michael Daniel

Senior Vice President and Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to Bassett Furniture Industries, Incorporated and will be retained by Bassett Furniture Industries, Incorporated and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document And Entity Information - USD ($)	12 Months Ended
	Nov. 26, 2022	Jan. 13, 2023	May 28, 2022
Document Information [Line Items]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Nov. 26, 2022
Document Transition Report	false
Entity File Number	000-00209
Entity Registrant Name	BASSETT FURNITURE INDUSTRIES, INCORPORATED
Entity Incorporation, State or Country Code	VA
Entity Tax Identification Number	54-0135270
Entity Address, Address Line One	3525 FAIRYSTONE PARK HIGHWAY
Entity Address, City or Town	BASSETT
Entity Address, State or Province	VA
Entity Address, Postal Zip Code	24055
City Area Code	276
Local Phone Number	629-6000
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Entity Shell Company	false
Entity Public Float			$ 166,389,769
Entity Common Stock, Shares Outstanding (in shares)		8,957,259
Auditor Firm ID	42
Auditor Name	Ernst & Young LLP
Auditor Location	Richmond, Virginia
Entity Central Index Key	0000010329
Current Fiscal Year End Date	--11-26
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	FY
Amendment Flag	false

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021
Current assets
Cash and cash equivalents	$ 61,625	$ 34,374
Short-term investments	17,715	17,715
Accounts receivable, net of allowance for credit losses of $1,261 and $567 as of November 26, 2022 and November 27, 2021, respectively	17,838	20,567
Inventories	85,477	78,004
Recoverable income taxes	2,353	8,379
Current assets of discontinued operations held for sale	0	11,064
Other current assets	11,487	10,181
Total current assets	196,495	180,284
Property and equipment, net	77,001	69,168
Other long-term assets
Deferred income taxes, net	5,528	3,189
Goodwill and other intangible assets	21,727	14,354
Right of use assets under operating leases	99,472	95,955
Long-term assets of discontinued operations held for sale	0	52,757
Other	6,050	5,953
Total other long-term assets	132,777	172,208
Total assets	406,273	421,660
Current liabilities
Accounts payable	20,359	23,988
Accrued compensation and benefits	12,921	12,639
Customer deposits	35,963	51,492
Current portion of operating lease obligations	18,819	20,235
Current liabilites of discontinued operations held for sale	0	16,095
Other accrued liabilities	12,765	9,770
Total current liabilities	100,827	134,219
Long-term liabilities
Post employment benefit obligations	9,954	12,968
Long-term portion of operating lease obligations	97,477	94,845
Long-term liabilities of discontinued operations held for sale	0	16,210
Other long-term liabilities	2,406	686
Total long-term liabilities	109,837	124,709
Commitments and Contingencies
Stockholders
Common stock, $5 par value; 50,000,000 shares authorized; issued and outstanding 8,951,839 at November 26, 2022 and 9,762,125 at November 27, 2021	44,759	48,811
Retained earnings	150,800	115,631
Additional paid-in-capital	0	113
Accumulated other comprehensive income (loss)	50	(1,823)
Total stockholders' equity	195,609	162,732
Total liabilities and stockholders’ equity	$ 406,273	$ 421,660

XML

Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021
Allowance for doubtful	$ 1,261	$ 567
Common Stock, Par or Stated Value Per Share (in dollars per share)	$ 5	$ 5
Common Stock, Shares Authorized (in shares)	50,000,000	50,000,000
Common Stock, Shares, Issued (in shares)	8,951,839	9,762,125
Common Stock, Shares, Outstanding, Ending Balance (in shares)	8,951,839	9,762,125

XML

Consolidated Statements of Operations - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Net sales of furniture and accessories	$ 485,601	$ 430,886	$ 337,672
Cost of furniture and accessories sold	237,262		163,567
Gross profit	248,339	221,087	174,105
Selling, general and administrative expenses	218,069	196,830	176,405
Gain on sale of real estate	4,595	0	0
Asset impairment charges	0	0	12,184
Goodwill impairment charge	0	0	1,971
Litigation expense	0	0	1,050
Income (loss) from continuing operations	34,865	24,257	(17,505)
Interest income	302	48	232
Interest expense	38	33	(0)
Other loss, net	(1,067)	(1,515)	(740)
Income (loss) from continuing operations before income taxes	34,062	22,757	(18,013)
Income tax expense (benefit)	8,702	5,836	(6,536)
Income (loss) from continuing operations	25,360	16,921	(11,477)
Discontinued operations:
Income from operations of logistical services	1,712	1,483	1,227
Gain on disposal	52,534	0	0
Income tax expense	14,261	362	171
Income from discontinued operations	39,985	1,121	1,056
Net income	$ 65,345	$ 18,042	$ (10,421)
Basic earnings (loss) per share:
Income (loss) from continuing operations (in dollars per share)	$ 2.70	$ 1.72	$ (1.15)
Income from discontinued operations (in dollars per share)	4.26	0.11	0.11
Basic earnings (loss) per share (in dollars per share)	6.96	1.83	(1.04)
Diluted earnings (loss) per share:
Income (loss) from continuing operations (in dollars per share)	2.70	1.72	(1.15)
Income from discontinued operations (in dollars per share)	4.26	0.11	0.11
Diluted earnings (loss) per share (in dollars per share)	6.96	1.83	(1.04)
Dividends per share
Regular dividends (in dollars per share)	0.60	0.53	0.46
Special dividend (in dollars per share)	$ 1.50	$ 0.25	$ 0
Furniture and Accessories [Member]
Net sales of furniture and accessories	$ 485,601	$ 430,886	$ 337,672
Cost of furniture and accessories sold		$ 209,799

XML

Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Net income (loss)	$ 65,345	$ 18,042	$ (10,421)
Other comprehensive income (loss):
Foreign currency translation adjustments	(274)	0	0
Income taxes related to foreign currency translation adjustments	70	0	0
Actuarial adjustment to Long Term Cash Awards (LTCA)	303	26	(86)
Other comprehensive income (loss), net of tax	1,873	(428)	(158)
Total comprehensive income (loss)	67,218	17,614	(10,579)
Pension Plan [Member]
Other comprehensive income (loss):
Amortization associated with LTCA	132	144	125
Income taxes related to LTCA	(107)	(44)	(10)
Supplemental Employee Retirement Plan [Member]
Other comprehensive income (loss):
Amortization associated with LTCA	124	44	8
Income taxes related to LTCA	(575)	190	64
Actuarial adjustment to supplemental executive retirement defined benefit plan (SERP)	$ (2,200)	$ 788	$ 259

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Operating activities:
Net income (loss)	$ 65,345	$ 18,042	$ (10,421)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	11,309	14,597	13,480
Gain on disposal of discontinued operations	(52,534)	0	0
Non-cash goodwill impairment charge	0	0	1,971
Non-cash asset impairment charges	0	0	12,184
Net gain on disposals of property and equipment	(4,595)	(367)	(81)
Gains on lease modifications	0	(37)	(1,313)
Inventory valuation charges	3,648	2,969	4,922
Deferred income taxes	(2,339)	1,545	2,513
Other, net	(302)	765	(51)
Changes in operating assets and liabilities
Accounts receivable	3,169	(5,828)	(962)
Inventories	(9,536)	(26,087)	6,494
Other current and long-term assets	5,944	(2,241)	(9,325)
Right of use assets under operating leases	20,531	26,243	32,107
Customer deposits	(16,588)	11,730	14,421
Accounts payable and accrued liabilities	(4,073)	2,153	5,965
Obligations under operating leases	(22,949)	(28,921)	(35,229)
Net cash provided by (used in) operating activities	(2,970)	14,563	36,675
Investing activities:
Purchases of property and equipment	(21,296)	(10,750)	(6,029)
Proceeds from sales of property and equipment	8,226	382	2,345
Cash paid for business acquisitions, net of cash acquired	(5,582)	0	0
Proceeds from the disposition of discontinued operations	84,534	0	0
Purchases of investments	0	0	(295)
Proceeds from maturities of investments	0	0	16
Other	(40)	(1,203)	216
Net cash provided by (used in) investing activities	65,842	(11,571)	(3,747)
Financing activities:
Cash dividends	(20,162)	(7,689)	(4,544)
Proceeds from exercise of stock options	0	42	0
Issuance of common stock	424	363	285
Repurchases of common stock	(15,122)	(5,566)	(2,208)
Taxes paid related to net share settlement of equity awards	(19)	(219)	(228)
Repayment of finance lease obligations	(684)	(1,348)	(121)
Net cash used in financing activities	(35,563)	(14,417)	(6,816)
Effect of exchenge rate changes on cash and cash equivalents	(58)	0	0
Change in cash and cash equivalents	27,251	(11,425)	26,112
Cash and cash equivalents - beginning of year	34,374	45,799	19,687
Cash and cash equivalents - end of year	$ 61,625	$ 34,374	$ 45,799

XML

Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Common Stock Outstanding [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Cumulative Effect, Period of Adoption, Adjustment [Member]	Total
Balance (in shares) at Nov. 30, 2019	10,116,290
Balance at Nov. 30, 2019	$ 50,581	$ 195	$ (3,785)	$ 129,130	$ (1,236)	$ (3,785)	$ 178,670
Net Income (loss)				(10,421)			(10,421)
Amortization of defined benefit plan costs, net of tax	0	0		0	98		98
Actuarial adjustments to defined benefit plans, net of tax	0	0		0	(256)		(256)
Regular dividends	$ 0	0		(4,545)	0		(4,545)
Issuance of common stock (in shares)	43,218
Issuance of common stock	$ 216	69		0	0		285
Purchase and retirement of common stock (in shares)	(216,721)
Purchase and retirement of common stock	$ (1,083)	(684)		(669)	0		(2,436)
Stock-based compensation	$ 0	420		0	0		420
Issuance of common stock (in shares)	43,218
Issuance of common stock	$ 216	69		0	0		285
Balance (in shares) at Nov. 28, 2020	9,942,787
Balance at Nov. 28, 2020	$ 49,714	0		109,710	(1,394)		158,030
Net Income (loss)				18,042			18,042
Amortization of defined benefit plan costs, net of tax	0	0		0	138		138
Actuarial adjustments to defined benefit plans, net of tax	0	0		0	(567)		(567)
Regular dividends	$ 0	0		(5,210)	0		(5,210)
Issuance of common stock (in shares)	34,902
Issuance of common stock	$ 175	230		0	0		405
Purchase and retirement of common stock (in shares)	(215,564)
Purchase and retirement of common stock	$ (1,078)	(275)		(4,432)	0		(5,785)
Stock-based compensation	$ 0	158		0	0		158
Special dividend				(2,479)			(2,479)
Issuance of common stock (in shares)	34,902
Issuance of common stock	$ 175	230		0	0		405
Special dividend				2,479			2,479
Balance (in shares) at Nov. 27, 2021	9,762,125
Balance at Nov. 27, 2021	$ 48,811	113		115,631	(1,823)		162,732
Net Income (loss)				65,345			65,345
Amortization of defined benefit plan costs, net of tax	0	0		0	192		192
Actuarial adjustments to defined benefit plans, net of tax	0	0		0	1,885		1,885
Regular dividends	$ 0	0		(5,668)	0		(5,668)
Issuance of common stock (in shares)	59,024
Issuance of common stock	$ 295	129		0	0		424
Purchase and retirement of common stock (in shares)	(869,310)
Purchase and retirement of common stock	$ (4,347)	(780)		(10,014)	0		(15,141)
Stock-based compensation	0	538		0	0		538
Special dividend	$ (0)	(0)		14,494	(0)		14,494
Issuance of common stock (in shares)	59,024
Issuance of common stock	$ 295	129		0	0		424
Foreign currency translation adjustments, net of tax					(204)		(204)
Special dividend	$ 0	0		(14,494)	0		(14,494)
Balance (in shares) at Nov. 26, 2022	8,951,839
Balance at Nov. 26, 2022	$ 44,759	$ 0		$ 150,800	$ 50		$ 195,609

XML

Consolidated Statements of Stockholders' Equity (Parentheticals) - $ / shares	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Retained Earnings [Member]
Regular dividends (in dollars per share)	$ 0.60	$ 0.53	$ 0.455
Common Stock, Dividends, Per Share, Declared (in dollars per share)	0.60	0.53	0.455
Special Dividend, Per Share, Declared (in dollars per share)	1.50	0.25
Regular dividends (in dollars per share)	0.60	0.53	0.46
Common Stock, Dividends, Per Share, Declared (in dollars per share)	$ 0.60	$ 0.53	$ 0.46

XML

Note 1 - Description of Business

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

1. Description of Business

Bassett Furniture Industries, Incorporated (together with its consolidated subsidiaries, “Bassett”, “we”, “our”, the “Company”) based in Bassett, Virginia, is a leading manufacturer, marketer and retailer of branded home furnishings. Bassett’s full range of furniture products and accessories, designed to provide quality, style and value, are sold through an exclusive nation-wide network of 91 retail stores known as Bassett Home Furnishings (referred to as “BHF”). Of the 91 stores, the Company owns and operates 58 stores (“Company-owned retail stores”) with the other 33 being independently owned (“licensee operated”). We also distribute our products through other multi-line furniture stores, many of which feature Bassett galleries or design centers. Products can also be purchased by the end consumer directly from our website.

We sourced approximately 22% of our wholesale products from various foreign countries, with the remaining volume produced at our five domestic manufacturing facilities.

Impact of the COVID-19 Pandemic Upon our Financial Condition and Results of Operations

On March 11, 2020, the World Health Organization declared the coronavirus (“COVID-19”) outbreak to be a global pandemic. In response to this declaration and the rapid spread of COVID-19 within the United States, federal, state and local governments throughout the country imposed varying degrees of restrictions on social and commercial activity to promote social distancing in an effort to slow the spread of the illness. These measures had a significant adverse impact upon many sectors of the economy, including non-essential retail commerce, beginning in our second fiscal quarter of 2020.

In response to the restrictive measures imposed by governmental authorities and for the protection of our employees and customers, we temporarily closed our dedicated stores, our manufacturing locations and many of our warehouses for much of the second fiscal quarter of 2020. This extended period of suspended operations had a material adverse impact upon our results of operations during the second fiscal quarter of 2020 and resulted in a significant net loss for 2020. In addition to operating losses resulting from severely reduced sales volumes, we also recorded charges for goodwill impairment (Note 8) as well as for the impairment of certain other long-lived assets (Note 14). However, since restarting our manufacturing operations and reopening stores, we have seen a significant improvement in business conditions which allowed us to return to overall profitability for the third and fourth fiscal quarters of 2020 continuing through fiscal 2021. Tempering these improvements were the continuing logistical challenges faced by the entire home furnishings industry that resulted from COVID-related labor shortages and supply chain disruptions which created significant delays in order fulfillment and increased backlogs. By the end of fiscal 2022, these issues have been substantially resolved.

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Note 2 - Significant Accounting Policies

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Significant Accounting Policies [Text Block]

2. Significant Accounting Policies

Basis of Presentation and Principles of Consolidation

The Consolidated Financial Statements include the accounts of Bassett Furniture Industries, Incorporated and our majority-owned subsidiaries in which we have a controlling interest. All significant intercompany balances and transactions are eliminated in consolidation. The financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). Unless otherwise indicated, references in the Consolidated Financial Statements to fiscal 2022, 2021 and 2020 are to Bassett's fiscal year ended November 26, 2022, November 27, 2021 and November 28, 2020, respectively. References to the “ASC” included hereinafter refer to the Accounting Standards Codification established by the Financial Accounting Standards Board as the source of authoritative GAAP.

We analyzed our licensees under the requirements for variable interest entities (“VIEs”). All of these licensees operate as BHF stores and are furniture retailers. We sell furniture to these licensees, and in some cases have extended credit beyond normal terms, made lease guarantees, guaranteed loans, or loaned directly to the licensees. We have recorded reserves for potential exposures related to these licensees. See Note 15 for disclosure of leases and lease guarantees. Based on financial projections and best available information, all licensees have sufficient equity to carry out their principal operating activities without subordinated financial support. Furthermore, we believe that the power to direct the activities that most significantly impact the licensees’ operating performance continues to lie with the ownership of the licensee dealers. Our rights to assume control over or otherwise influence the licensees’ significant activities only exist pursuant to our license and security agreements and are in the nature of protective rights as contemplated under ASC Topic 810. We completed our assessment for other potential VIEs and concluded that there were none. We will continue to reassess the status of potential VIEs including when facts and circumstances surrounding each potential VIE change.

We were the primary beneficiary of one VIE by virtue of our control over the activities that most significantly impact the entity’s economic performance. This VIE was created to affect a Section 1031 like-kind exchange involving the purchase of real property in the state of Florida and the sale of real property in the state of Texas (see Note 14). Subsequent to the completion of the exchange transactions during the third quarter of fiscal 2022, the sole equity interest in the VIE was transferred to Bassett and the entity is now consolidated as a wholly owned subsidiary.

On January 31, 2022, we entered into a definitive agreement to sell substantially all of the assets of our wholly-owned subsidiary, Zenith Freight Lines, LLC (“Zenith”) to J.B. Hunt Transport Services, Inc. (“J.B. Hunt”). The sale was completed on February 28, 2022. Accordingly, the operations of our logistical services segment as well as the gain realized upon disposal are presented in the accompanying condensed consolidated statements of income as discontinued operations, and the assets sold to and liabilities assumed by J.B. Hunt are presented in the accompanying condensed consolidated balance sheet as of November 27, 2021 as assets and liabilities of discontinued operations held for sale. See Note 18 for additional information. Costs incurred by Bassett for logistical services performed for Bassett by Zenith are included in selling, general and administrative expenses.

On September 2, 2022, we acquired 100% of the capital stock of Noa Home Inc. (“Noa Home”), a mid-priced e-commerce furniture retailer headquartered in Montreal, Canada. Noa Home has operations in Canada, Australia, Singapore and the United Kingdom. Since acquisition, Noa Home has been consolidated as a wholly-owned subsidiary. See Note 3 for additional information.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Some of the more significant estimates include allowances for doubtful accounts, calculation of inventory reserves, the valuation of our reporting units for the purpose of testing the carrying value of goodwill, and the valuation of our right of use assets. We also utilize estimates in determining the valuation of income tax reserves, lease guarantees, insurance reserves, and assumptions related to our post-employment benefit obligations. Actual results could differ from those estimates.

Revenue Recognition

ASC Topic 606, Revenue from Contracts with Customers, requires a company to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration the company expects to receive in exchange for those goods or services. For our wholesale and retail segments, revenue is recognized when the risks and rewards of ownership and title to the product have transferred to the buyer.

At wholesale, transfer occurs and revenue is recognized upon the shipment of goods to independent dealers and licensee-owned BHF stores. We offer payment terms varying from 30 to 60 days for wholesale customers. Estimates for returns and allowances have been recorded as a reduction of revenue based on our historical return patterns. The contracts with our licensee store owners do not provide for any royalty or license fee to be paid to us.

At retail, transfer occurs and revenue is recognized upon delivery of goods to the customer. We typically collect a significant portion of the purchase price as a customer deposit upon order, with the balance typically collected upon delivery. These deposits are carried on our balance sheet as a current liability until delivery is fulfilled and amounted to $35,963 and $51,492 as of November 26, 2022 and November 27, 2021, respectively. Substantially all of the customer deposits held at November 27, 2021 related to performance obligations were satisfied during fiscal 2022 and have therefore been recognized in revenue for the year ended November 26, 2022. Estimates for returns and allowances have been recorded as a reduction of revenue based on our historical return patterns. We also sell furniture protection plans to our retail customers on behalf of a third party which is responsible for the performance obligations under the plans. Revenue from the sale of these plans is recognized upon delivery of the goods net of amounts payable to the third-party service provider.

Sales commissions are expensed as part of selling, general and administrative expenses at the time revenue is recognized because the amortization period would have been one year or less. Sales commissions at wholesale are accrued upon the shipment of goods. Sales commissions at retail are accrued at the time a sale is written (i.e. – when the customer’s order is placed) and are carried as prepaid commissions in other current assets until the goods are delivered and revenue is recognized. At November 26, 2022 and November 27, 2021, our balance of prepaid commissions included in other current assets was $3,768 and $6,221, respectively.

For our accounting and reporting under ASC 606, we apply the following policy elections and practical expedients:

• We exclude from revenue amounts collected from customers for sales tax, which is consistent with our policy prior to the adoption of ASC 606.

• We do not adjust the promised amount of consideration for the effects of a significant financing component since the period of time between transfer of our goods or services and the collection of consideration from the customer is less than one year.

• We do not disclose the value of unsatisfied performance obligations because the transfer of goods or services is made within one year of the placement of customer orders.

See Note 20 for disaggregated revenue information.

Cash Equivalents and Short-Term Investments

The Company considers cash on hand, demand deposits in banks and all highly liquid investments with an original maturity of three months or less to be cash and cash equivalents. Our short-term investments consist of certificates of deposit that have original maturities of twelve months or less but greater than three months.

Accounts Receivable

Substantially all of our trade accounts receivable is due from customers located within the United States. We maintain an allowance for credit losses for estimated losses resulting from the inability of our customers to make required payments. The allowance for credit losses is based on a review of specifically identified accounts in addition to an overall aging analysis which is applied to accounts pooled on the basis of similar risk characteristics. Judgments are made with respect to the collectibility of accounts receivable within each pool based on historical experience, current payment practices and current economic trends based on our expectations over the expected life of the receivables, which is generally ninety days or less. Actual credit losses could differ from those estimates.

Concentrations of Credit Risk and Major Customers

Financial instruments that subject us to credit risk consist primarily of investments, accounts and notes receivable and financial guarantees. Investments are managed within established guidelines to mitigate risks. Accounts and notes receivable and financial guarantees subject us to credit risk partially due to the concentration of amounts due from and guaranteed on behalf of independent licensee customers. At November 26, 2022 and November 27, 2021, our aggregate exposure from receivables and guarantees related to customers consisted of the following:

	2022		2021
Accounts receivable, net of allowances (Note 5)	$	17,838	$	20,567
Contingent obligations under lease and loan guarantees, less amounts recognized (Note 15)		1,828		1,794
Other		43		86
Total credit risk exposure related to customers	$	19,709	$	22,447

At November 26, 2022 and November 27, 2021, approximately 31% and 24%, respectively, of the aggregate risk exposure, net of reserves, shown above was attributable to five customers. In fiscal 2022, 2021 and 2020, no customer accounted for more than 10% of total consolidated net sales.

We have no foreign manufacturing operations. We define export sales from our wholesale segment as sales to any country or territory other than the United States or its territories or possessions. Our wholesale export sales were approximately $731, $488, and $789 in fiscal 2022, 2021, and 2020, respectively. All of our export sales are invoiced and settled in U.S. dollars.

Inventories

Inventories (retail merchandise, finished goods, work in process and raw materials) accounted for under the first-in, first out (“FIFO”) method are stated at the lower of cost or net realizable value or, in the case of inventory accounted for under the last-in, first out (“LIFO”) method, at the lower of cost or market. Cost is determined for domestic manufactured furniture inventories using the LIFO method because we believe this methodology provides better matching of revenue and expenses. The cost of imported inventories as well as Lane Venture, Bassett Outdoor and Noa Home product inventories are determined on a first-in, first-out (“FIFO”) basis. Inventories accounted for under the LIFO method represented 46% and 53% of total inventory before reserves at November 26, 2022 and November 27, 2021, respectively. We estimate inventory reserves for excess quantities and obsolete items based on specific identification and historical write-offs, taking into account future demand and market conditions. If actual demand or market conditions in the future are less favorable than those estimated, additional inventory write-downs may be required.

Property and Equipment

Property and equipment is comprised of all land, buildings and leasehold improvements and machinery and equipment used in the manufacturing and warehousing of furniture, our Company-owned retail operations, our logistical services operations, and corporate administration. This property and equipment is stated at cost less accumulated depreciation. Depreciation is computed over the estimated useful lives of the respective assets utilizing the straight-line method. Buildings and improvements are generally depreciated over a period of 10 to 39 years. Machinery and equipment are generally depreciated over a period of 5 to 10 years. Leasehold improvements are amortized based on the underlying lease term, or the asset’s estimated useful life, whichever is shorter.

Goodwill

Goodwill represents the excess of the fair value of consideration given over the fair value of the tangible assets and liabilities and identifiable intangible assets of businesses acquired. The acquisition of assets and liabilities and the resulting goodwill is allocated to the respective reporting unit: Wood, Upholstery, Retail or Logistical Services. We review goodwill at the reporting unit level annually for impairment or more frequently if events or circumstances indicate that assets might be impaired.

In accordance with ASC Topic 350, Intangibles – Goodwill & Other, we first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative goodwill impairment test described in ASC Topic 350. The more likely than not threshold is defined as having a likelihood of more than 50 percent. If, after assessing the totality of events or circumstances, we determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the quantitative impairment test is unnecessary and our goodwill is considered to be unimpaired. However, if based on our qualitative assessment we conclude that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, we will proceed with performing the quantitative evaluation process. We performed an interim test of goodwill as of May 30, 2020 due to the severe impact of the COVID-19 pandemic and resulting business interruption during the second fiscal quarter of 2020. This interim test resulted in an impairment charge of $1,971 for the year ended November 28, 2020. For the annual tests of goodwill performed as of the beginning of the fourth fiscal quarters of 2022 and 2021, we performed the qualitative assessment as described above and concluded that there was no additional impairment of our goodwill as of November 26, 2022 or November 27, 2021.

The quantitative evaluation compares the carrying value of each reporting unit that has goodwill with the estimated fair value of the respective reporting unit. Should the carrying value of a reporting unit be in excess of the estimated fair value of that reporting unit, a goodwill impairment charge will be recognized in the amount by which the reporting unit’s carrying amount exceeds its fair value, but not to exceed the total goodwill assigned to the reporting unit. The determination of the fair value of our reporting units is based on a combination of a market approach, that considers benchmark company market multiples, an income approach, that utilizes discounted cash flows for each reporting unit and other Level 3 inputs as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurements and Disclosure (see Note 4), and, in the case of our retail reporting unit, a cost approach that utilizes estimates of net asset value. The cash flows used to determine fair value are dependent on a number of significant management assumptions such as our expectations of future performance and the expected future economic environment, which are partly based upon our historical experience. Our estimates are subject to change given the inherent uncertainty in predicting future results. Additionally, the discount rate and the terminal growth rate are based on our judgment of the rates that would be utilized by a hypothetical market participant. As part of the goodwill impairment testing, we also consider our market capitalization in assessing the reasonableness of the combined fair values estimated for our reporting units. While we believe such assumptions and estimates are reasonable, the actual results may differ materially from the projected amounts. See Note 8 for additional information regarding the results of our interim goodwill impairment test performed as of May 30, 2020.

Leases

Effective as of the beginning of fiscal 2020, we adopted ASU 2016-02, Leases (Topic 842) and all related amendments. The guidance requires lessees to recognize substantially all leases on their balance sheet as a right-of-use (“ROU”) asset and a lease liability.

We lease land and buildings that are used in the operation of our Company-owned retail stores as well as in the operation of certain of our licensee-owned stores, and we lease land and buildings at various locations throughout the continental United States for warehouse space used in our retail segment. We also lease local delivery trucks used in our retail segment. We determine if a contract contains a lease at inception based on our right to control the use of an identified asset and our right to obtain substantially all of the economic benefits from the use of that identified asset. Our real estate lease terms range from one to 15 years and generally have renewal options of between five and 15years. We assess these options to determine if we are reasonably certain of exercising these options based on all relevant economic and financial factors. Any options that meet this criteria are included in the lease term at lease commencement.

Most of our leases do not have an interest rate implicit in the lease. As a result, for purposes of measuring our ROU asset and lease liability, we determine our incremental borrowing rate by applying a spread above the U.S. Treasury borrowing rates. In the case an interest rate is implicit in a lease we will use that rate as the discount rate for that lease. Some of our leases contain variable rent payments based on a Consumer Price Index or percentage of sales. Due to the variable nature of these costs, they are not included in the measurement of the ROU asset and lease liability.

We adopted the standard utilizing the transition election to not restate comparative periods for the impact of adopting the standard and recognizing the cumulative impact of adoption in the opening balance of retained earnings. We elected the package of transition expedients available for expired or existing contracts, which allowed the carry-forward of historical assessments of (1) whether contracts are or contain leases, (2) lease classification and (3) initial direct costs. In addition, we have elected the practical expedient to not separate lease and non-lease components when determining the ROU asset and lease liability and have elected the practical expedient related to land easements, allowing us to carry forward our accounting treatment for land easements on existing agreements. We have also elected the hindsight practical expedient to determine the lease term for existing leases. In our application of hindsight, we evaluated the performance of the leased stores and the associated markets in relation to our overall real estate strategies, which resulted in the determination that most renewal options would not be reasonably certain in determining the expected lease term. We have made an accounting policy election to not recognize ROU assets and lease liabilities on the balance sheet for those leases with initial terms of one year or less and instead such lease obligations will be expensed on a straight-line basis over the lease term.

Adoption of the standard resulted in the recording of additional net lease-related assets and lease-related liabilities of $146,585 and $151,672, respectively, as of December 1, 2019. The difference between the additional lease assets and lease liabilities, net of the $1,302 deferred tax impact, was $3,785 and was recorded as an adjustment to retained earnings. This adjustment to retained earnings primarily represents the impairment of right-of-use assets associated with certain underperforming retail locations. Our estimates of the fair value of the impaired ROU assets included estimates of discounted cash flows based upon current market rents and other inputs which we consider to be Level 3 inputs as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurement and Disclosure (see Note 4). Our adoption of this standard did not have a material impact on our consolidated statements of operations, comprehensive income or cash flows.

See Note 15 for additional information regarding our leases.

Other Intangible Assets

Intangible assets acquired in a business combination and determined to have an indefinite useful life are not amortized but are tested for impairment annually or between annual tests when an impairment indicator exists. The recoverability of indefinite-lived intangible assets is assessed by comparison of the carrying value of the asset to its estimated fair value. If we determine that the carrying value of the asset exceeds its estimated fair value, an impairment loss equal to the excess would be recorded.

Definite-lived intangible assets are amortized over their respective estimated useful lives and reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. We estimate the useful lives of our intangible assets and ratably amortize the value over the estimated useful lives of those assets. If the estimates of the useful lives should change, we will amortize the remaining book value over the remaining useful lives or, if an asset is deemed to be impaired, a write-down of the value of the asset may be required at such time.

Impairment of Long Lived Assets

We periodically evaluate whether events or circumstances have occurred that indicate long-lived assets may not be recoverable or that the remaining useful life may warrant revision. When such events or circumstances are present, we assess the recoverability of long-lived assets by determining whether the carrying value will be recovered through the expected undiscounted future cash flows resulting from the use and eventual disposition of the asset. In the event the sum of the expected undiscounted future cash flows is less than the carrying value of the asset, an impairment loss equal to the excess of the asset’s carrying value over its fair value is recorded. Fair value is determined based on discounted cash flows or appraised values depending on the nature of the assets. The long-term nature of these assets requires the estimation of cash inflows and outflows several years into the future.

When analyzing our real estate properties for potential impairment, we consider such qualitative factors as our experience in leasing and selling real estate properties as well as specific site and local market characteristics. Upon the closure of a Bassett Home Furnishings store, we generally write off all tenant improvements which are only suitable for use in such a store. ROU assets under operating leases are written down to their estimated fair value. Our estimates of the fair value of the impaired ROU assets included estimates of discounted cash flows based upon current market rents and other inputs which we consider to be Level 3 inputs as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurement and Disclosure (see Note 4).

Income Taxes

We account for income taxes under the liability method which requires that we recognize deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amount of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. See Note 13.

We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. Despite our belief that our liability for unrecognized tax benefits is adequate, it is often difficult to predict the final outcome or the timing of the resolution of any particular tax matters. We may adjust these liabilities as relevant circumstances evolve, such as guidance from the relevant tax authority or our tax advisors, or resolution of issues in the courts. These adjustments are recognized as a component of income tax expense in the period in which they are identified.

We evaluate our deferred income tax assets to determine if valuation allowances are required or should be adjusted. A valuation allowance is established against our deferred tax assets based on consideration of all available evidence, both positive and negative, using a “more likely than not” standard. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carryforward or carryback periods, our experience with tax attributes expiring unused and tax planning alternatives. In making such judgments, significant weight is given to evidence that can be objectively verified. See Note 13.

Shipping and Handling Costs

Costs incurred to deliver wholesale merchandise to customers are recorded in selling, general and administrative expense and totaled $21,341, $17,829, and $14,779 for fiscal 2022, 2021 and 2020, respectively. Costs incurred to deliver retail merchandise to customers, including the cost of operating regional distribution warehouses, are also recorded in selling, general and administrative expense and totaled $23,812, $22,494, and $19,024 for fiscal 2022, 2021 and 2020, respectively.

Advertising

Costs incurred for producing and distributing advertising and advertising materials are expensed when incurred and are included in selling, general and administrative expenses. Advertising costs totaled $16,698, $15,228, and $12,619 in fiscal 2022, 2021, and 2020, respectively.

Insurance Reserves

We have self-funded insurance programs in place to cover workers’ compensation and health insurance. These insurance programs are subject to various stop-loss limitations. We accrue estimated losses using historical loss experience. Although we believe that the insurance reserves are adequate, the reserve estimates are based on historical experience, which may not be indicative of current and future losses. We adjust insurance reserves, as needed, in the event that future loss experience differs from historical loss patterns.

Supplemental Cash Flow Information

Refer to the supplemental lease disclosures in Note 15 for cash flow impacts of leasing transactions during fiscal 2022, 2021 and 2020. Otherwise, there were no material non-cash investing or financing activities during fiscal 2022, 2021 or 2020.

Recent Accounting Pronouncements

Recently Adopted Pronouncements

Effective as of the beginning of fiscal 2022, we have adopted Accounting Standards Update No. 2019-12 – Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes. The amendments in ASU 2019-12 eliminate certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also clarifies and simplifies other aspects of the accounting for income taxes. The amendments in ASU 2019-12 became effective for us as of the beginning of our 2022 fiscal year. We adopted ASU 2019-12 on a prospective basis and the adoption did not have a material impact upon our financial condition or results of operations.

Recent Pronouncements Not Yet Adopted

In October 2021, the FASB issued Accounting Standards Update No. 2021-08– Business Combinations (Topic 805) Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, to improve the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to the recognition of an acquired contract liability and to payment terms and their effect on subsequent revenue recognized by the acquirer. The amendments in ASU 2021-08 require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. At the acquisition date, an acquirer should account for the related revenue contracts in accordance with Topic 606 as if it had originated the contracts. The amendments in ASU 2021-08 will become effective for us as of the beginning of our 2024 fiscal year. Early adoption is permitted, including adoption in any interim period. We do not expect that this guidance will have a material impact upon our financial position and results of operations.

In March 2022, the FASB issued Accounting Standards Update No. 2022-02 – Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures, to address certain concerns identified in the Post-Implementation Review process for ASU Topic 326. The amendments in ASU 2022-02 eliminate the accounting guidance for troubled debt restructurings by creditors in ASC Subtopic 310-40, Receivables – Troubled Debt Restructurings by Creditors, while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. In addition, for public business entities, the amendments in ASU 2022-02 require that an entity disclose current-period gross write-offs by year of origination for financing receivables and net investments in leases within the scope of ASC Subtopic 326-20, Financial Instruments – Credit Losses – Measured at Amortized Cost. The amendments in ASU 2022-02 will become effective for us as of the beginning of our 2024 fiscal year. Early adoption is permitted. We expect that the adoption of this standard will primarily impact our disclosures but do not expect that this guidance will have a material impact upon our financial position and results of operations.

In June 2022, the FASB issued Accounting Standards Update No. 2022-03 – Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, to clarify the guidance in Topic 820 when measuring the fair value of an equity security subject to contractual restrictions that prohibit the sale of an equity security. The amendments in ASU 2022-03 clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. In addition, the amendments in ASU 2022-03 require certain additional disclosures related to investments in equity securities subject to contractual sale restrictions. The amendments in ASU 2022-03 will become effective for us as of the beginning of our 2025 fiscal year. Early adoption is permitted. As of August 27, 2022 we do not hold any investments in equity securities, therefore we do not currently expect that this guidance will have a material impact upon our financial position and results of operations.

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Note 3 - Business Combinations

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Business Combination Disclosure [Text Block]

3. Business Combinations

On September 2, 2022, we acquired 100% of the capital stock of Noa Home Inc. (“Noa Home”), a mid-priced e-commerce furniture retailer headquartered in Montreal, Canada. Noa Home has operations in Canada, Australia, Singapore and the United Kingdom. The initial purchase price (denominated in Canadian dollars) of approximately C$7,700 included cash payments of C$2,000 paid to the co-founders of Noa Home and approximately C$5,700 for the repayment of existing debt owed by Noa Home. The Noa Home co-founders will also have the opportunity to receive additional cash payments totaling approximately C$1,330 per year for the following three fiscal years based on established increases in net revenues and achieving certain internal EBITDA goals.

Under the acquisition method of accounting, the fair value of the consideration transferred was allocated to the tangible and intangible assets acquired and the liabilities assumed based on their estimated fair values as of the acquisition date with the remaining unallocated amount recorded as goodwill.

The allocation of the fair value of the acquired business has been based on a preliminary valuation. Our estimates and assumptions are subject to change as we obtain additional information for our estimates during the measurement period (up to one year from the acquisition date). The primary areas of the preliminary allocation of the fair value of consideration transferred that are not yet finalized relate to the fair values of certain tangible and intangible assets acquired and the residual goodwill. The preliminary allocation of the purchase price (translated into U.S. dollars as of the acquisition date) is as follows:

Fair value of consideration transferred in exchange for 100% of Noa Home:
Cash	$	5,878
Fair value of contingent consideration payable		1,375
Total fair value of consideration paid or payable	$	7,253
Allocation of the fair value of consideration transferred:
Identifiable assets acquired:
Cash	$	296
Inventory		1,585
Other current assets		317
Property & equipment		155
Intangible asset - trade name		1,929
Total identifiable assets acquired		4,282
Liabilities assumed:
Accounts payable		(1,227	)
Customer deposits		(1,059	)
Other current liabilities and accrued expenses		(458	)
Total liabilities assumed		(2,744	)
Net identifiable assets acquired		1,538
Goodwill		5,715
Total net assets acquired	$	7,253

Goodwill was determined based on the residual difference between the fair value of the consideration transferred and the value assigned to the tangible and intangible assets and liabilities recognized in connection with the acquisition and is deductible for tax purposes. Among the factors that contributed to a purchase price resulting in the recognition of goodwill are the expected synergies arising from combining the Company’s manufacturing and distribution capabilities with Noa Home’s position in the international e-commerce market for home furnishings and accessories.

A portion of the fair value of the consideration transferred in the amount of $1,929 has been assigned to the identifiable intangible asset associated with the Noa Home trade name. This intangible asset is considered to have an indefinite life. The indefinite-lived intangible asset and goodwill are not amortized but will be tested for impairment annually or between annual tests if an indicator of impairment exists.

The fair values of consideration transferred and net assets acquired were determined using a combination of Level 2 and Level 3 inputs as specified in the fair value hierarchy in ASC 820, Fair Value Measurements and Disclosures. See Note 4.

Acquisition costs related to the Noa Home acquisition totaled $87 during the year ended November 26, 2022, and are included in selling, general and administrative expenses in the consolidated statements of income. The acquisition costs are primarily related to legal services.

The revenues and results of operations of Noa Home since September 2, 2022 were not material. The pro forma impact of the acquisition has not been presented because it was not material to our consolidated results of operations for the three fiscal years ended November 26, 2022.

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Note 4 - Financial Instruments, Investments and Fair Value Measurements

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Fair Value Disclosures [Text Block]

4. Financial Instruments, Investments and Fair Value Measurements

Financial Instruments

Our financial instruments include cash and cash equivalents, short-term investments in certificates of deposit, accounts receivable, accounts payable and long-term debt. Because of their short maturities, the carrying amounts of cash and cash equivalents, short-term investments in certificates of deposit, accounts receivable, and accounts payable approximate fair value.

Investments

Our short-term investments of $17,715 at both November 26, 2022 and November 27, 2021 consisted of certificates of deposit (CDs) with original terms of six to twelve months, bearing interest at rates ranging from 0.3% to 3.1%. At November 26, 2022, the weighted average remaining time to maturity of the CDs was approximately three months and the weighted average yield of the CDs was approximately 2.2%. Each CD is placed with a federally insured financial institution and all deposits are within Federal deposit insurance limits. As the CDs mature, we expect to reinvest them in CDs of similar maturities of up to one year. Due to the nature of these investments and their relatively short maturities, the carrying amount of the short-term investments at November 26, 2022 and November 27, 2021 approximates their fair value.

Fair Value Measurement

The Company accounts for items measured at fair value in accordance with ASC Topic 820, Fair Value Measurements and Disclosures. ASC 820’s valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect our market assumptions. ASC 820 classifies these inputs into the following hierarchy:

Level 1 Inputs– Quoted prices for identical instruments in active markets.

Level 2 Inputs– Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.

Level 3 Inputs– Instruments with primarily unobservable value drivers.

We believe that the carrying amounts of our current assets and current liabilities approximate fair value due to the short-term nature of these items. Our primary non-recurring fair value estimates typically involve the following: business acquisitions (Note 3) which involve a combination of Level 2 and Level 3 inputs to determine the fair value of contingent consideration and net assets acquired, including identified intangible assets; goodwill impairment testing (Note 8), which involves Level 3 inputs; and asset impairments (Note 14) which utilize Level 3 inputs.

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Note 5 - Accounts Receivable

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

5. Accounts Receivable

Accounts receivable consists of the following:

	November 26, 2022			November 27, 2021
Gross accounts receivable	$	19,099		$	21,134
Allowance for credit losses		(1,261	)		(567	)
Net accounts receivable	$	17,838		$	20,567

Activity in the allowance for credit losses was as follows:

	2022			2021
Balance, beginning of the year	$	567		$	905
Additions (recoveries) charged to expense		761			(161	)
Reductions to allowance, net		(67	)		(177	)
Balance, end of the year	$	1,261		$	567

We believe that the carrying value of our net accounts receivable approximates fair value. The inputs into these fair value estimates reflect our market assumptions and are not observable. Consequently, the inputs are considered to be Level 3 as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurements and Disclosures. See Note 4.

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Note 6 - Inventories

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Inventory Disclosure [Text Block]

6. Inventories

Inventories consist of the following:

	November 26, 2022			November 27, 2021
Wholesale finished goods	$	46,607		$	40,254
Work in process		620			482
Raw materials and supplies		22,859			21,653
Retail merchandise		32,974			30,914
Total inventories on first-in, first-out method		103,060			93,303
LIFO adjustment		(12,416	)		(10,483	)
Reserve for excess and obsolete inventory		(5,167	)		(4,816	)
	$	85,477		$	78,004

We source a significant amount of our wholesale product from other countries. During 2022, 2021 and 2020, purchases from our two largest vendors located in Vietnam and China were $33,253, $34,658 and $15,378 respectively.

We estimate an inventory reserve for excess quantities and obsolete items based on specific identification and historical write-offs, taking into account future demand, market conditions and the respective valuations at LIFO. The need for these reserves is primarily driven by the normal product life cycle. As products mature and sales volumes decline, we rationalize our product offerings to respond to consumer tastes and keep our product lines fresh. If actual demand or market conditions in the future are less favorable than those estimated, additional inventory write-downs may be required. In determining reserves, we calculate separate reserves on our wholesale and retail inventories. Our wholesale inventories tend to carry the majority of the reserves for excess quantities and obsolete inventory due to the nature of our distribution model. These wholesale reserves primarily represent design and style obsolescence. Typically, product is not shipped to our retail warehouses until a consumer has ordered and paid a deposit for the product. We do not typically hold retail inventory for stock purposes. Consequently, floor sample inventory and inventory for delivery to customers account for the majority of our inventory at retail. Retail reserves are based on accessory and clearance floor sample inventory in our stores and any inventory that is not associated with a specific customer order in our retail warehouses.

Activity in the reserves for excess quantities and obsolete inventory by segment are as follows:

	Wholesale Segment			Retail Segment			Total
Balance at November 28, 2020	$	3,421		$	1,101		$	4,522
Additions charged to expense		2,057			912			2,969
Write-offs		(1,795	)		(880	)		(2,675	)
Balance at November 27, 2021		3,683			1,133			4,816
Additions charged to expense		2,577			1,071			3,648
Write-offs		(2,157	)		(1,140	)		(3,297	)
Balance at November 26, 2022	$	4,103		$	1,064		$	5,167

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Note 7 - Property and Equipment

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Property, Plant and Equipment Disclosure [Text Block]

7. Property and Equipment

Property and equipment consist of the following:

	November 26, 2022			November 27, 2021
Land	$	10,866		$	8,538
Buildings and leasehold improvements		116,418			107,975
Machinery and equipment		101,153			94,521
Property and equipment at cost		228,437			211,034
Less accumulated depreciation		(151,436	)		(141,866	)
Property and equipment, net	$	77,001		$	69,168

The net book value of our property and equipment by reportable segment is a follows:

	November 26, 2022		November 27, 2021
Wholesale	$	36,502	$	30,020
Retail - Company-owned stores		40,499		39,148
Total property and equipment, net	$	77,001	$	69,168

Depreciation expense associated with the property and equipment shown above was included in income from operations in our consolidated statements of operations as follows:

	2022		2021		2020
Cost of goods sold (wholesale segment)	$	2,082	$	1,797	$	1,552
Selling, general and adminstrative expenses:
Wholesale segment		2,154		1,532		1,516
Retail segment		5,750		6,580		6,578
Total included in selling, general and adminstrative expenses		7,904		8,112		8,094
Total depreciation expense included in income from operations	$	9,986	$	9,909	$	9,646

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Note 8 - Goodwill and Other Intangible Assets

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Goodwill and Intangible Assets Disclosure [Text Block]

8. Goodwill and Other Intangible Assets

Goodwill and other intangible assets consisted of the following:

	November 26, 2022
	Gross Carrying Amount		Accumulated Amortization			Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	$	512	$	(280	)	$	232
Intangibles not subject to amortization:
Trade names							8,723
Goodwill							12,772
Total goodwill and other intangible assets						$	21,727

	November 27, 2021
	Gross Carrying Amount		Accumulated Amortization			Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	$	512	$	(223	)	$	289
Intangibles not subject to amortization:
Trade names							6,848
Goodwill							7,217
Total goodwill and other intangible assets						$	14,354

Due to the impact of the COVID-19 pandemic during our 2020 fiscal year, we performed an interim impairment assessment of our remaining goodwill as of May 30, 2020, the end of our second fiscal quarter. As a result of this test, we concluded that the carrying value of our wood reporting unit exceeded its fair value by an amount in excess of the goodwill previously allocated to the reporting unit. Therefore, we recognized a goodwill impairment charge of $1,971 for the year ended November 28, 2020. Our subsequent annual goodwill impairment tests, conducted as of the beginning of our fourth fiscal quarters of 2020, 2021 and 2022, resulted in no additional impairments.

The determination of the fair value of our reporting units is based on a combination of a market approach, that considers benchmark company market multiples, and an income approach, that utilizes discounted cash flows for each reporting unit and other Level 3 inputs as specified in the fair value hierarchy in ASC Topic 820, Fair Value Measurements and Disclosure (see Note 4). Under the income approach, we determine fair value based on the present value of the most recent cash flow projections for each reporting unit as of the date of the analysis and calculate a terminal value utilizing a terminal growth rate. The significant assumptions under this approach include, among others: income projections, which are dependent on future sales, new product introductions, customer behavior, competitor pricing, operating expenses, the discount rate, and the terminal growth rate. The cash flows used to determine fair value are dependent on a number of significant management assumptions such as our expectations of future performance and the expected future economic environment, which are partly based upon our historical experience. Our estimates are subject to change given the inherent uncertainty in predicting future results. Additionally, the discount rate and the terminal growth rate are based on our judgment of the rates that would be utilized by a hypothetical market participant. As part of the goodwill impairment testing, we also consider our market capitalization in assessing the reasonableness of the combined fair values estimated for our reporting units.

Changes in the carrying amounts of goodwill by reportable segment were as follows:

	Wholesale		Retail			Total
Balance as of November 28, 2020	$	7,217	$	-		$	7,217
No changes in fiscal 2021		-		-			-
Balance as of November 27, 2021		7,217		-			7,217
Acquisition of Noa Home		-		5,715			5,715
Foreign currency translation adjustment		-		(161	)		(161	)
Balance as of November 26, 2022	$	7,217	$	5,554		$	12,771

Accumulated impairment losses were $3,897 at each of November 26, 2022, November 27, 2021 and November 28, 2020.

The weighted average useful lives of our finite-lived intangible assets and remaining amortization periods as of November 26, 2022 are as follows:

	Useful Life in Years		Remaining Amortization Period in Years
Customer relationships		9		4

Our trade name intangible assets are associated with Noa Home and Lane Venture. Because it is our intention to maintain and grow those brands, they are considered to be indefinite-lived intangible assets. The amortization expense associated with finite-lived intangible assets during fiscal 2022, 2021 and 2020 was $57 each year and is included in selling, general and administrative expense in our consolidated statement of operations. All expense arising from the amortization of intangible assets is associated with our wholesale segment. Estimated future amortization expense for intangible assets that exist at November 26, 2022 is as follows:

Fiscal 2023	$	57
Fiscal 2024		57
Fiscal 2025		57
Fiscal 2026		57
Fiscal 2027		4
Total	$	232

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Note 9 - Bank Credit Facility

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Debt Disclosure [Text Block]

9. Bank Credit Facility

Bank Credit Facility

Our bank credit facility provides for a line of credit of up to $25,000. At November 26, 2022, we had $3,931 outstanding under standby letters of credit against our line, leaving availability under our credit line of $21,069. In addition, we had outstanding standby letters of credit with another bank totaling $250 at November 26, 2022. The line bears interest at the One-Month Term Secured Overnight Financing Rate (“One-Month Term SOFR”) plus 1.5% and is unsecured. Our bank charges a fee of 0.25% on the daily unused balance of the line, payable quarterly. Under the terms of the facility, we must maintain the following financial covenants, measured quarterly on a rolling twelve-month basis:

● Consolidated fixed charge coverage ratio of not less than 1.4 times,

● Consolidated lease-adjusted leverage ratio not to exceed 3.0 times, and

● Minimum tangible net worth of $140,000.

We were in compliance with these covenants at November 26, 2022 and expect to remain in compliance for the foreseeable future. The credit facility will mature on January 27, 2025, at which time any amounts outstanding under the facility will be due.

Total interest paid during fiscal 2022, 2021 and 2020 was not material.

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Note 10 - Post-employment Benefit Obligations

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Postemployment Benefits Disclosure [Text Block]

10. Post-Employment Benefit Obligations

Management Savings Plan

On May 1, 2017, our Board of Directors, upon the recommendation of the Organization, Compensation and Nominating Committee (the “Committee”), adopted the Bassett Furniture Industries, Incorporated Management Savings Plan (the “Plan”). The Plan is an unfunded, nonqualified deferred compensation plan maintained for the benefit of certain highly compensated or management level employees.

The Plan is an account-based plan under which (i) participants may defer voluntarily the payment of current compensation to future years (“participant deferrals”) and (ii) the Company may make annual awards to participants payable in future years (“Company contributions”). The Plan permits each participant to defer up to 75% of base salary and up to 100% of any incentive compensation or other bonus, which amounts would be credited to a deferral account established for the participant. Such deferrals will be fully vested at the time of the deferral. Participant deferrals will be indexed to one or more deemed investment alternatives chosen by the participant from a range of alternatives made available under the Plan. Each participant’s account will be adjusted to reflect gains and losses based on the performance of the selected investment alternatives. A participant may receive distributions from the Plan: (1) upon separation from service, in either a lump sum or annual installment payments over up to a 15 year period, as elected by the participant, (2) upon death or disability, in a lump sum, or (3) on a date or dates specified by the participant (“scheduled distributions”) with such scheduled payments made in either a lump sum or substantially equal annual installments over a period of up to five years, as elected by the participant. Participant contributions commenced during the third quarter of fiscal 2017. Company contributions will vest in full (1) on the third anniversary of the date such amounts are credited to the participant’s account, (2) the date that the participant reaches age 63 or (3) upon death or disability. Company contributions are subject to the same rules described above regarding the crediting of gains or losses from deemed investments and the timing of distributions. Expense (credits) associated with deferred compensation under the Plan was $(16), $338 and $264 for fiscal 2022, 2021 and 2020, respectively. Our liability for Company contributions and participant deferrals at November 26, 2022 and November 27, 2021 was $2,070 and $1,789, respectively, and is included in post-employment benefit obligations in our consolidated balance sheets.

On May 2, 2017, we made Long Term Cash Awards (“LTC Awards”) totaling $2,000 under the Plan to certain management employees in the amount of $400 each. The LTC Awards vest in full on the first anniversary of the date of the award if the participant has reached age 63 by that time, or, if later, on the date the participant reaches age 63, provided in either instance that the participant is still employed by the Company at that time. If not previously vested, the awards will also vest immediately upon the death or disability of the participant prior to the participant’s separation from service. The awards will be payable in 10 equal annual installments following the participant’s death, disability or separation from service. We are accounting for the LTC Awards as a defined benefit pension plan. During fiscal 2022, 2021 and 2020, we invested $853, $647 and $609 in life insurance policies covering all participants in the Plan. At November 26, 2022, these policies have a net death benefit of $14,998 for which the Company is the sole beneficiary. These policies are intended to provide a potential source of funds to meet the obligations arising from the deferred compensation and LTC Awards under the Plan and serve as an economic hedge of the financial impact of changes in the liabilities. They are held in an irrevocable trust but are subject to claims of creditors in the event of the Company’s insolvency.

Supplemental Retirement Income Plan

We have an unfunded Supplemental Retirement Income Plan (the “Supplemental Plan”) that covers one current and certain former executives. Upon retirement, the Supplemental Plan provides for lifetime monthly payments in an amount equal to 65% of the participant’s final average compensation as defined in the Supplemental Plan, which is reduced by certain social security benefits to be received and other benefits provided by us. The Supplemental Plan also provides a death benefit that is calculated as (a) prior to retirement death, which pays the beneficiary 50% of final average annual compensation for a period of 120 months, or (b) post-retirement death, which pays the beneficiary 200% of final average compensation in a single payment. We own life insurance policies on these executives with a current net death benefit of $1,587 at November 26, 2022 and we expect to substantially fund this death benefit through the proceeds received upon the death of the executive. Funding for the remaining cash flows is expected to be provided through operations. There are no benefits payable as a result of a termination of employment for any reason other than death or retirement, other than a change of control provision which provides for the immediate vesting and payment of the retirement benefit under the Supplemental Plan in the event of an employment termination resulting from a change of control.

Aggregated summarized information for the Supplemental Plan and the LTC Awards, measured as of the end of each year presented, is as follows:

`	2022			2021
Change in Benefit Obligation:
Projected benefit obligation at beginning of year	$	10,740		$	10,071
Service cost		36			120
Interest cost		231			196
Actuarial (gains) and losses		(2,503	)		762
Benefits paid		(1,242	)		(409	)
Projected benefit obligation at end of year	$	7,262		$	10,740
Accumulated Benefit Obligation	$	7,262		$	10,740
Discount rate used to value the ending benefit obligations:		5.38	%		2.25	%
Amounts recognized in the consolidated balance sheet:
Current liabilities	$	698		$	913
Noncurrent liabilities		6,564			9,827
Total amounts recognized	$	7,262		$	10,740
Amounts recognized in accumulated other comprehensive income:
Prior service cost	$	229		$	355
Actuarial (gain) loss		(543	)		2,093
Net amount recognized	$	(314	)	$	2,448
Total recognized in net periodic benefit cost and accumulated other comprehensive income:	$	(2,236	)	$	1,078

	2022			2021			2020
Components of Net Periodic Pension Cost:
Service cost	$	36		$	121		$	172
Interest cost		231			196			268
Amortization of prior service cost		126			126			126
Amortization of other loss		133			59			8
Net periodic pension cost	$	526		$	502		$	574
Assumptions used to determine net periodic pension cost:
Discount rate		2.25	%		2.00	%		2.75	%
Increase in future compensation levels		3.00	%		3.00	%		3.00	%

Estimated Future Benefit Payments (with mortality):
Fiscal 2023	$	698
Fiscal 2024		667
Fiscal 2025		715
Fiscal 2026		683
Fiscal 2027		691
Fiscal 2028 through 2032		3,135

Of the $314 net gain recognized in accumulated other comprehensive income at November 26, 2022, amounts expected to be recognized as components of net periodic pension cost during fiscal 2023 are as follows:

Prior service cost	$	126
Other loss		(1	)
Total expected to be amortized to net periodic pension cost in 2023	$	125

The components of net periodic pension cost other than the service cost component are included in other loss, net in our consolidated statements of operations.

Deferred Compensation Plan

We have an unfunded Deferred Compensation Plan that covers one current and certain former executives and provides for voluntary deferral of compensation. This plan has been frozen with no additional participants or benefits permitted. We recognized expense of $154, $204, and $176 in fiscal 2022, 2021, and 2020, respectively, associated with the plan. Our liability under this plan was $1,616 and $1,648 as of November 26, 2022 and November 27, 2021, respectively. The non-current portion of this obligation is included in post-employment benefit obligations in our consolidated balance sheets, with the current portion included in accrued compensation and benefits.

Defined Contribution Plan

We have a qualified defined contribution plan (Employee Savings/Retirement Plan) that covers substantially all employees who elect to participate and have fulfilled the necessary service requirements. Employee contributions to the Plan are matched at the rate of 25% of up to 8% of gross pay, regardless of years of service. During fiscal 2020, the Company’s matching contribution was temporarily suspended for approximately six months as part of the cash conservation measures put into place in response to the impact of the COVID-19 pandemic but was resumed during the fourth quarter. Expense for employer matching contributions was $1,108, $1,040 and $548 during fiscal 2022, 2021 and 2020, respectively.

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Note 11 - Accumulated Other Comprehensive Loss

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Comprehensive Income (Loss) Note [Text Block]

11. Accumulated Other Comprehensive Income (Loss)

The activity in accumulated other comprehensive income (loss) for the fiscal years ended November 26, 2022 and November 27, 2021, which is comprised of post-retirement benefit costs related to our SERP and LTC Awards as well as cumulative translation adjustments arising from our investment in Noa Home, is as follows:

Balance at November 28, 2020	$	(1,394	)
Actuarial losses		(762	)
Net pension amortization reclassified from accumulated other comprehensive loss		186
Tax effects		147
Balance at November 27, 2021		(1,823	)
Actuarial gains		2,503
Net pension amortization reclassified from accumulated other comprehensive loss		256
Foreign currency translation adjustment		(272	)
Tax effects		(614	)
Balance at November 26, 2022	$	50

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Note 12 - Capital Stock and Stock Compensation

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Share-Based Payment Arrangement [Text Block]

12. Capital Stock and Stock Compensation

We account for our stock-based employee and director compensation plans in accordance with ASC 718, Compensation – Stock Compensation. ASC 718 requires recognition of the cost of employee services received in exchange for an award of equity instruments in the financial statements over the period the employee is required to perform the services in exchange for the award (presumptively the vesting period) which we recognize on a straight-line basis. Compensation expense related to restricted stock and stock options included in selling, general and administrative expenses in our consolidated statements of operations for fiscal 2022, 2021 and 2020 was as follows:

	2022		2021		2020
Stock based compensation expense	$	538	$	158	$	420

Incentive Stock Compensation Plans

2021 Plan

On March 10, 2021, our shareholders approved the Bassett Furniture Industries, Incorporated 2021 Stock Incentive Plan (the “2021 Plan”). All present and future non-employee directors, key employees and outside consultants for the Company are eligible to receive incentive awards under the 2021 Plan. Our Organization, Compensation and Nominating Committee (the “OCN Committee”) selects eligible key employees and outside consultants to receive awards under the 2021 Plan in its discretion. Our Board of Directors or any committee designated by the Board of Directors selects eligible non-employee directors to receive awards under the 2021 Plan in its discretion. Five hundred thousand (500,000) shares of common stock are reserved for issuance under the 2021 Plan. Participants may receive the following types of incentive awards under the 2021 Plan: stock options, stock appreciation rights, payment shares, restricted stock, restricted stock units and performance shares. Stock options may be incentive stock options or non-qualified stock options. Stock appreciation rights may be granted in tandem with stock options or as a freestanding award. Non-employee directors and outside consultants are eligible to receive restricted stock and restricted stock units only. The full terms of the 2021 Plan have been filed as an exhibit to our Schedule 14A filed with the United States Securities and Exchange Commission on February 8, 2021.

2010 Plan

On April 14, 2010, our shareholders approved the Bassett Furniture Industries, Incorporated 2010 Stock Incentive Plan which was amended and restated effective January 13, 2016 (the “2010 Plan”). All non-employee directors, key employees and outside consultants for the Company were eligible to receive incentive awards under the 2010 Plan. The 2010 Plan expired in April of 2020 and no additional grants can be awarded under the plan. All remaining unexpired options granted under the 2010 Plan were exercised during fiscal 2021.

The fair value of each option award was estimated on the date of grant using the Black-Scholes option pricing model. The risk free rate is based on the U.S. Treasury rate for the expected life at the time of grant, volatility is based on the average long-term implied volatilities of peer companies, the expected life is based on the estimated average of the life of options using the simplified method. Forfeitures are recognized as they occur. We utilized the simplified method to determine the expected life of our options due to insufficient exercise activity during recent years as a basis from which to estimate future exercise patterns.

Grants of non-vested restricted shares are measured at fair value as if the shares were vested and issued on the grant date. Forfeitures are recognized as they occur. We recognize compensation cost for awards with service only conditions with a graded vesting schedule on a straight-line basis over the longest vesting period.

Stock Options

There were no new grants of options made in 2022, 2021 or 2020.

Additional information regarding activity in our stock options during fiscal 2022, 2021 and 2020 is as follows:

	2022		2021		2020
Total intrinsic value of options exercised	$	-	$	93	$	-
Total cash received from the exercise of options		-		42		-
Excess tax benefits recognized in income tax expense upon the exercise of options		-		18		-

Restricted Shares

Changes in the outstanding non-vested restricted shares during the year ended November 26, 2022 were as follows:

	Number of Shares			Weighted Average Grant Date Fair Value Per Share
Non-vested restricted shares outstanding at November 27, 2021		10,605		$	21.24
Granted		67,099			16.27
Vested		(10,605	)		21.24
Non-vested restricted shares outstanding at November 26, 2022		67,099		$	16.27

During fiscal 2022, 10,605 restricted shares were vested and released, of which 3,500 shares had been granted to employees and 7,105 shares had been granted to directors. During fiscal 2022, 2021 and 2020, 1,225 shares, 10,850 shares and 14,010 shares, respectively, were withheld to cover withholding taxes of $19, $219 and $228, respectively, arising from the vesting of restricted shares. During fiscal 2022, 2021 and 2020, excess tax benefits (expense) of $1, $(133) and $(114), respectively, were recognized within income tax expense upon the release of vested shares.

Additional information regarding our outstanding non-vested restricted shares at November 26, 2022 is as follows:

					Remaining
	Restricted		Share Value		Restriction
Grant	Shares		at Grant Date		Period
Date	Outstanding		Per Share		(Years)
January 12, 2022		51,300	$	15.82		2.1
March 9, 2022		15,799		17.72		0.3
		67,099

Unrecognized compensation cost related to these non-vested restricted shares at November 26, 2022 is $611, all of which is expected to be recognized in fiscal 2023 and 2024.

Employee Stock Purchase Plan

In March of 2017 we adopted and implemented the 2017 Employee Stock Purchase Plan (“2017 ESPP”) that allows eligible employees to purchase a limited number of shares of our stock at 85% of market value. Under the 2017 ESPP we sold 30,074, 22,547 and 50,217 shares to employees during fiscal 2022, 2021 and 2020, respectively, which resulted in an immaterial amount of compensation expense. There are 102,460 shares remaining available for sale under the 2017 ESPP at November 26, 2022.

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Note 13 - Income Taxes

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Income Tax Disclosure [Text Block]

13. Income Taxes

The components of the income tax provision from continuing operations are as follows:

	2022		2021		2020
Current:
Federal	$	5,659	$	4,507	$	(8,233	)
State		2,154		171		148
Deferred:
Federal		484		60		2,067
State		405		1,098		(518	)
Total	$	8,702	$	5,836	$	(6,536	)

On March 27, 2020 the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was signed into law. A major provision of the CARES Act allows net operating losses from the 2018, 2019 and 2020 tax years to be carried back up to five years. As a result, for the year ended November 28, 2020 we were able to recognize tax benefits substantially in excess of the current federal statutory rate of 21% due to the effects of carrying back our current net operating loss to tax years in which the federal statutory rate was 35%.

A reconciliation of the statutory federal income tax rate and the effective income tax rate, as a percentage of income before income taxes, is as follows:

	2022			2021			2020
Statutory federal income tax rate		21.0	%		21.0	%		21.0	%
Adjustments to state net operating CARES Act benefit		-			-			19.2
State income tax, net of federal benefit		4.4			4.2			1.7
Impairment of non-deductible goodwill		-			-			(2.5	)
Excess tax from stock-based compensation		-			0.4			(0.6	)
Other		0.1			(0.1	)		(2.5	)
Effective income tax rate		25.5	%		25.5	%		36.3	%

Excess tax benefits (expense) in the amount of $1, $(115) and $(114) were recognized as a component of income tax expense during fiscal 2022, 2021 and 2020, respectively, resulting from the exercise of stock options and the release of restricted shares. The fiscal 2020 adjustment for impairment of non-deductible goodwill reflect the fact that there was no tax basis related to the impaired goodwill.

The income tax effects of temporary differences and carryforwards, which give rise to significant portions of the deferred income tax assets and deferred income tax liabilities, are as follows:

	November 26, 2022			November 27, 2021
Deferred income tax assets:
Trade accounts receivable	$	315		$	199
Inventories		3,782			3,121
Notes receivable		-			44
Post employment benefit obligations		2,734			3,562
State net operating loss carryforwards		9			153
Foreign net operating loss carryforwards		1,339			-
Operating lease liabilities		29,423			34,813
Other		1,713			1,180
Gross deferred income tax assets		39,315			43,072
Valuation allowance		(1,339	)		-
Total deferred income tax assets		37,976			43,072
Deferred income tax liabilities:
Property and equipment		5,532			7,013
Intangible assets		726			1,712
Operating lease assets		25,166			29,758
Prepaid expenses and other		1,024			1,400
Total deferred income tax liabilities		32,448			39,883
Net deferred income tax assets	$	5,528		$	3,189

We have state net operating loss carryforwards available to offset future taxable state income of $238, which expire in varying amounts between 2030 and 2040. Realization is dependent on generating sufficient taxable income prior to expiration of the loss carryforwards. We also have foreign net operating loss carryforwards attributable to Noa Home (see Note 3) of $5,357, substantially all of which related to pre-acquisition losses, resulting in a deferred tax asset of $1,339 upon which we have placed a full valuation allowance.

Income taxes paid, net of refunds received, during fiscal 2022, 2021 and 2020 were $20,176, $3,092, and $539, respectively.

We regularly evaluate, assess and adjust our accrued liabilities for unrecognized tax benefits in light of changing facts and circumstances, which could cause the effective tax rate to fluctuate from period to period. Our liabilities for uncertain tax positions are not material.

Significant judgment is required in evaluating the Company's federal and state tax positions and in the determination of its tax provision. Despite our belief that the liability for unrecognized tax benefits is adequate, it is often difficult to predict the final outcome or the timing of the resolution of any particular tax matter. We may adjust these liabilities as relevant circumstances evolve, such as guidance from the relevant tax authority, or resolution of issues in the courts. These adjustments are recognized as a component of income tax expense in the period in which they are identified. The Company also cannot predict when or if any other future tax payments related to these tax positions may occur.

We remain subject to examination for tax years 2019 through 2022 for all of our major tax jurisdictions.

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Note 14 - Other Gains and Losses

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Other Gains and Losses [Text Block]

14. Other Gains and Losses

Gains on Dispositions of Retail Store Locations

During the third quarter of fiscal 2022, we sold one of our Company-owned store locations in Houston, Texas for $8,217 net of closing costs, resulting in a gain of $4,595 during the year ended November 26, 2022. This store will be relocated to a new leased store in the Houston market that we expect to open during the third quarter of fiscal 2023 (see Note 15).

This sale, together with our purchase of real property in Tampa, Florida for $7,668 in cash during the second quarter of fiscal 2022 will be treated as an exchange of like-kind property under Section 1031 of the Internal Revenue Code of 1986, as amended, for the purpose of deferring approximately $4,300 of the taxable gain arising from the sale of the Houston property. A VIE was established during the second quarter of fiscal 2022 for purposes of acquiring the Tampa, Florida property, of which the Company was the primary beneficiary by virtue of our control over the activities that most significantly impact the entity's economic performance. Subsequent to the completion of the exchange transactions during the third quarter of fiscal 2022, the sole equity interest in the VIE was transferred to Bassett and the entity is now consolidated as a wholly owned subsidiary We plan to remodel the Tampa property and open as a Company-owned store in the third quarter of fiscal 2023.

Selling, general and administrative expenses for the year ended November 28, 2020 include gains totaling $1,313 resulting from the settlement of lease obligations due to the early termination of leases at our retail store locations in Torrance, California and Culver City, California.

Asset Impairment Charges and Lease Exit Costs

During fiscal 2020 we recorded $11,114 of non-cash impairment charges on the assets of five underperforming retail stores, including $6,239 for the impairment of operating lease right-of-use assets associated with the leased locations. Also in fiscal 2020 we incurred $1,070 of non-cash impairment charges in our wholesale segment, primarily due to the closing of our custom upholstery manufacturing facility in Grand Prairie, Texas, in May.

Litigation Expense

During fiscal 2020 we accrued $1,050 for the estimated costs to resolve certain wage and hour violation claims that had been asserted against the Company.

Gains from Company-Owned Life Insurance

Other loss, net for the fiscal 2022 and 2020 includes gains of $1,441 and $914, respectively, arising from death benefits from Company-owned life insurance.

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Note 15 - Leases and Lease Guarantees

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Lessee, Operating and Finance Leases [Text Block]

15. Leases and Lease Guarantees

Leases

Effective as of the beginning of fiscal 2020, we adopted ASU 2016-02, Leases (Topic 842) and all related amendments. See “Leases” under Note 2 for a discussion of our accounting policies and elections under Topic 842 as well as the impact of the adoption upon our financial statements.

Supplemental balance sheet information related to our leases as of November 26, 2022 and November 27, 2021 is as follows:

	November 26, 2022		November 27, 2021
Operating leases:
Right of use assets	$	99,472	$	95,955
Lease liabilties, short-term		18,819		20,235
Lease liabilties, long-term		97,477		94,845
Finance leases:
Right of use assets (1)	$	623	$	832
Lease liabilties, short-term (2)		282		254
Lease liabilties, long-term (3)		360		588

(1) Included in property & equipment, net in our consolidated balance sheet.

(2) Included in other current liabilites and accrued expenses in our consolidated balance sheet.

(3) Included in other long-term liabilites and accrued expenses in our consolidated balance sheet.

Our right-of-use assets under operating leases by segment as of November 26, 2022 and November 27, 2021 are as follows:

	November 26, 2022		November 27, 2021
Wholesale	$	8,183	$	9,842
Retail		91,289		86,113
Total right of use assets	$	99,472	$	95,955

The components of our lease cost for 2022, 2021 and 2020 were as follows:

	2022			2021			2020
Lease cost:
Operating lease cost	$	24,399		$	24,367		$	24,946
Financing lease cost:
Amortization of right-of-use assets		279			95			-
Interest on lease liabilities		35			15			-
Short-term lease cost		674			387			545
Variable lease cost (net of abatements received)		447			277			(605	)
Sublease income		(1,444	)		(1,292	)		(1,557	)
Total lease cost	$	24,390		$	23,849		$	23,329

Supplemental lease disclosures as of November 26, 2022, November 27, 2021 and November 28, 2020 and for the fiscal years then ended are as follows:

	Operating			Financing
For the year ended November 28, 2020:
Cash paid for amounts included in the measurements of lease liabilities	$	27,011		$	-
Lease liabilities arising from new right-of-use assets		8,541			-
For the year ended November 27, 2021:
Cash paid for amounts included in the measurements of lease liabilities		26,842			103
Lease liabilities arising from new right-of-use assets		15,678			927
For the year ended November 26, 2022:
Cash paid for amounts included in the measurements of lease liabilities		26,913			302
Lease liabilities arising from new right-of-use assets		23,171			73
As of November 28, 2020:
Weighted average remaining lease terms (years)		6.4			-
Weighted average discount rates		5.00	%		-
As of November 27, 2021:
Weighted average remaining lease terms (years)		6.3			3.2
Weighted average discount rates		5.07	%		4.63	%
As of November 26, 2022:
Weighted average remaining lease terms (years)		6.2			2.3
Weighted average discount rates		5.53	%		4.68	%

Future payments under our leases and the present value of the obligations as of November 26, 2022 are as follows:

	Operating Leases		Financing Leases
Fiscal 2023	$	24,670	$	319
Fiscal 2024		24,458		256
Fiscal 2025		23,172		94
Fiscal 2026		20,506		5
Fiscal 2027		16,222		2
Thereafter		28,839		-
Total lease payments		137,867		676
Less: interest		21,571		34
Total lease obligations	$	116,296	$	642

As of November 26, 2022, we had a commitment to lease 9,597 square feet of retail space located at Post Oak Plaza in Houston, Texas. This space will be used for the relocation of a former retail store in the Houston market that was sold in 2022 (see Note 14). The initial term of the lease is ten years and calls for average monthly rents of $36. The lease has three successive five-year renewal options. We expect to occupy the premises during the first quarter of fiscal 2023 and open the store in the third quarter. We also have commitments to lease 61,182 square feet of retail warehouse space near Dallas, Texas and Columbus, Ohio. These leases each have a five-year terms with combined average monthly rents of $41. We expect to occupy these spaces during the first quarter of 2023.

We sublease a small number of our leased locations to certain of our licensees for operation as BHF network stores. The terms of these leases generally match those of the lease we have with the lessor. In addition, we sublease space in certain closed store locations that are still under lease. Minimum future lease payments due to us under these subleases are as follows:

Fiscal 2023	$	1,289
Fiscal 2024		879
Fiscal 2025		599
Fiscal 2026		156
Fiscal 2027		-
Thereafter		-
Total minimum future rental income	$	2,923

During fiscal 2020, we negotiated with a number of our landlords to obtain relief in the form of rent deferrals or abatements of rent as a result of the effects of COVID-19 on our business. The remaining balance of deferred rent at November 26, 2022 and November 27, 2021 was not material. In accordance with FASB Staff Q&A - Topic 842 and Topic 840: Accounting for Lease Concessions Related to the Effects of the COVID-19 Pandemic ("FASB Staff Q&A") issued in April 2020, we elected to account for any lease concessions resulting directly from COVID-19 as if the enforceable rights and obligations for the concessions existed in the respective contracts at lease inception and as such we will not account for any concession as a lease modification. Guidance from the FASB Staff Q&A provided methods to account for rent deferrals which include the option to treat the lease as if no changes to the lease contract were made or to treat deferred payments as variable lease payments. The FASB Staff Q&A allows entities to select the most practical approach and does not require the same approach be applied consistently to all leases. As a result, we accounted for the deferrals as if no changes to the lease contract were made and will continue to recognize lease expense, on a straight-line basis, during the deferral period. For any abatements received, we accounted for those as variable rent in the period in which the abatement is granted. For the year ended November 28, 2020, we were granted abatements against rent totaling $775.

Guarantees

As part of the strategy for our store program, we have guaranteed certain lease obligations of licensee operators. Lease guarantees range from one to five years. We were contingently liable under licensee lease obligation guarantees in the amount of $1,880 and $1,845 at November 26, 2022 and November 27, 2021, respectively.

In the event of default by an independent dealer under the guaranteed lease, we believe that the risk of loss is mitigated through a combination of options that include, but are not limited to, arranging for a replacement dealer, liquidating the collateral, and pursuing payment under the personal guarantees of the independent dealer. The proceeds of the above options are estimated to cover the maximum amount of our future payments under the guarantee obligations, net of reserves. The fair value of lease guarantees (an estimate of the cost to the Company to perform on these guarantees) at November 26, 2022 and November 27, 2021, were not material.

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Note 16 - Contingencies

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Legal Matters and Contingencies [Text Block]

16. Contingencies

We are involved in various claims and actions which arise in the normal course of business. Although the final outcome of these matters cannot be determined, based on the facts presently known, it is our opinion that the final resolution of these matters will not have a material adverse effect on our financial position or future results of operations.

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Note 17 - Earnings (Loss) Per Share

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Earnings Per Share [Text Block]

17. Earnings (Loss) Per Share

The following table sets forth the computation of basic and diluted earnings (loss) per share:

	2022		2021		2020
Earnings per share - continuing operations:
Numerator:
Net income (loss) from continuing operations	$	25,360	$	16,921	$	(11,477	)
Denominator:
Denominator for basic income per share - weighted average shares		9,394,873		9,835,829		9,969,616
Effect of dilutive securities*		8,107		7,945		-
Denominator for diluted income per share — weighted average shares and assumed conversions		9,402,980		9,843,774		9,969,616
Basic income (loss) per share - continuing operations:	$	2.70	$	1.72	$	(1.15	)
Diluted income (loss) per share - continuing operations	$	2.70	$	1.72	$	(1.15	)
Earnings per share - discontinued operations:
Numerator:
Net income from discontinued operations	$	39,985	$	1,121	$	1,056
Denominator:
Denominator for basic income per share - weighted average shares		9,394,873		9,835,829		9,969,616
Effect of dilutive securities*		8,107		7,945		-
Denominator for diluted income per share — weighted average shares and assumed conversions		9,402,980		9,843,774		9,969,616
Basic income per share - discontinued operations	$	4.26	$	0.11	$	0.11
Diluted income per share - discontinued operations	$	4.26	$	0.11	$	0.11

*Due to the net losses in 2020, the potentially dilutive securities would have been anti-dilutive and are therefore excluded.

For fiscal 2022, 2021 and 2020, the following potentially dilutive shares were excluded from the computations as their effect was anti-dilutive:

	2022		2021		2020
Unvested restricted shares		-		-		90,153
Stock options		-		-		5,250

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Note 18 - Discontinued Operations

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

18. Discontinued Operations

On January 31, 2022, we entered into a definitive agreement to sell substantially all of the assets of Zenith to J.B. Hunt. The sale was completed on February 28, 2022, at which time we received the following net proceeds:

Sales price prior to post-closing working capital adjustment	$	86,939
Less:
Amount held in escrow for contingencies related to representations and warranties (1)		1,000
Seller expenses paid at closing		418
Working capital adjustment paid to buyer		987
Net proceeds from the sale (2)	$	84,534

(1) To be held in escrow until the first anniversary of the sale, at which time any amount not distributed or reserved for specified claims will be released to the Company. This amount is included in other current assets in the accompanying condensed consolidated balance sheet at November 26, 2022.

(2) Included in cash flows from investing activities in the accompanying condensed consolidated statement of cash flows for the year ended November 26, 2022.

The sales price was subject to customary post-closing working capital adjustments which were paid during the second half of fiscal 2022 and resulted in a pre-tax gain from the sale of Zenith of $52,534.

The operations of our logistical services segment, which consisted entirely of the operations of Zenith, are presented in the accompanying consolidated statements of operations as discontinued operations, and the assets sold to and liabilities assumed by J.B. Hunt are presented in the accompanying consolidated balance sheet as assets and liabilities of discontinued operations held for sale as of November 27, 2021.

The following table summarizes the major classes of assets and liabilities of the discontinued operations held for sale as reported in the condensed consolidated balance sheet as of November 27, 2021:

	November 27, 2021
Carrying amounts of major classes of assets included as part of discontinued operations:
Accounts receivable, net	$	7,601
Other current assets		3,463
Property and equipment, net		24,898
Goodwill and other intangible assets		9,094
Right of use assets under operating leases		18,193
Other		572
	$	63,821
Balance sheet classification:
Current assets of discontinued operations held for sale	$	11,064
Long-term assets of discontinued operations held for sale		52,757
Total assets of discontinued operations held for sale	$	63,821
Carrying amounts of major classes of liabilities included as part of discontinued operations:
Accounts payable	$	4,336
Accrued compensation and benefits		3,295
Current portion operating lease obligations		7,458
Other current liabilites and accrued expenses		1,006
Long-term portion of operating lease obligations		10,996
Other long-term liabilities		5,214
	$	32,305
Balance sheet classification:
Current liabilities of discontinued operations held for sale	$	16,095
Long-term liabilities of discontinued operations held for sale		16,210
Total liabilities of discontinued operations held for sale	$	32,305

Following the sale of Zenith, certain of Zenith’s liabilities primarily representing reserves and accrued liabilities for pre-disposal workers’ compensation, health insurance and auto liability claims were retained by Bassett. The remaining balance of these reserves and accruals total $639 at November 26, 2022 and are included in other current liabilities and accrued expenses in the accompanying condensed consolidated balance sheet.

The following table summarizes the major classes of line items constituting income of the discontinued operations, as reported in the consolidated statements of operations for fiscal 2022, 2021 and 2020:

	2022			2021			2020
Major line items constituting pretax income of discontinued operations:
Logistical services revenue	$	16,776		$	55,648		$	48,191
Cost of logistical services		15,001			53,905			46,910
Other loss, net		(63	)		(260	)		(54	)
Income from operations of logistical services		1,712			1,483			1,227
Gain on disposal		52,534			-			-
Pretax income of discontinued operations		54,246			1,483			1,227
Income tax expense		14,261			362			171
Income from discontinued operations, net of tax	$	39,985		$	1,121		$	1,056

The amounts for revenue and costs of logistical services shown above represent the results of Zenith’s business transactions with third parties. Zenith also charged Bassett for logistical services provided to our wholesale segment in the amount of $9,121 during 2022 prior to disposal, and $31,329 and $26,967, for all of 2021 and 2020, respectively. We have entered into a service agreement with J.B. Hunt for the continuation of these services for a period of seven years following the sale of Zenith. Subsequent to the sale, we incurred $27,604 of expense during 2022 for the performance of logistical services, of which $26,065 had been paid in cash as of November 26, 2022.

Included in other loss, net, is interest arising from finance leases assumed by J.B. Hunt as part of the transaction. Such interest amounted to $78, $289 and $49, for 2022, 2021 and 2020, respectively.

The following table summarizes the cash flows generated by discontinued operations during 2022, 2021 and 2020:

	2022 (1)			2021			2020
Cash provided by operating activities	$	1,681		$	4,082		$	5,536
Cash used in investing activities		(81	)		(4,508	)		(2,900	)
Cash used in financing activities		(371	)		(1,259	)		(121	)
Net cash provided by (used in) discontinued operations	$	1,229		$	(1,685	)	$	2,515

(1) Excludes net proceeds from the sale of Zenith.

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Note 19 - Segment Information

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

19. Segment Information

We have strategically aligned our business into two reportable segments as defined in ASC 280, Segment Reporting, and as described below:

● Wholesale. The wholesale home furnishings segment is involved principally in the design, manufacture, sourcing, sale and distribution of furniture products to a network of Bassett stores (Company-owned and licensee-owned stores retail stores) and independent furniture retailers. Our wholesale segment includes our wood and upholstery operations as well as all corporate selling, general and administrative expenses, including those corporate expenses related to both Company- and licensee-owned stores. Our wholesale segment also includes our holdings of short-term investments and retail real estate previously leased as licensee stores. The earnings and costs associated with these assets are included in other loss, net, in our consolidated statements of operations.

● Retail – Company-owned stores. Our retail segment consists of Company-owned stores and includes the revenues, expenses, assets and liabilities and capital expenditures directly related to these stores and the Company-owned distribution network utilized to deliver products to our retail customers. The retail segment also includes the operations and net assets of Noa Home since the acquisition on September 2, 2022.

Inter-company sales elimination represents the elimination of wholesale sales to our Company-owned stores. Inter-company income elimination includes the embedded wholesale profit in the Company-owned store inventory that has not been realized. These profits will be recorded when merchandise is delivered to the retail consumer. The inter-company income elimination also includes rent paid by our retail stores occupying Company-owned real estate.

Our former logistical services segment which represented the operations of Zenith is now presented as a discontinued operation in the accompanying condensed consolidated balances sheets and statements of income (see Note 18).

The following table presents segment information for each of the last three fiscal years:

	2022			2021			2020
Sales Revenue
Wholesale sales of furniture and accessories	$	324,569		$	295,329		$	221,075
Less: Sales to retail segment		(125,889	)		(112,270	)		(95,347	)
Wholesale sales to external customers		198,680			183,059			125,728
Retail sales of furniture and accessories		286,921			247,827			211,944
Consolidated net sales of furniture and accessories	$	485,601		$	430,886		$	337,672
Income (loss) from Operations
Wholesale	$	9,286		$	17,490		$	4,587
Retail		21,508			7,044			(9,497	)
Inter-company elimination		(524	)		(277	)		2,610
Asset impairment charges		-			-			(12,184	)
Goodwill impairment charge		-			-			(1,971	)
Litigation expense		-			-			(1,050	)
Gain on sale of real estate		4,595			-			-
Consolidated income from operations	$	34,865		$	24,257		$	(17,505	)
Depreciation and Amortization
Wholesale	$	4,293		$	3,386		$	3,125
Retail		5,750			6,580			6,578
Discontinued operations		1,266			4,631			3,777
Consolidated	$	11,309		$	14,597		$	13,480
Capital Expenditures
Wholesale	$	10,748		$	5,943		$	2,434
Retail		10,548			299			695
Consolidated	$	21,296		$	6,242		$	3,129
Identifiable Assets
Wholesale	$	215,748		$	196,910		$	180,235
Retail		190,525			160,929			169,105
Discontinued operations		-			63,821			53,209
Consolidated	$	406,273		$	421,660		$	402,549

See Note 20 for disaggregated revenue information regarding sales of furniture and accessories by product type for the wholesale and retail segments.

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Note 20 - Revenue Recognition

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

Revenue from Contract with Customer [Text Block]

20. Revenue Recognition

Disaggregated revenue information for sales of furniture and accessories by product category for fiscal years 2022, 2021 and 2020, excluding intercompany transactions between our segments, is as follows:

	2022						2021						2020
	Wholesale		Retail (2)		Total		Wholesale		Retail		Total		Wholesale		Retail		Total
Bassett Custom Upholstery	$	124,565	$	163,755	$	288,320	$	105,445	$	139,527	$	244,972	$	71,840	$	112,888	$	184,728
Bassett Leather		35,953		1,707		37,660		36,157		226		36,383		20,487		2,326		22,813
Bassett Custom Wood		22,534		43,208		65,742		24,079		30,931		55,010		19,682		28,942		48,624
Bassett Casegoods		15,628		40,146		55,774		17,378		42,658		60,036		13,719		35,728		49,447
Accessories, mattresses and other (1)		-		38,105		38,105		-		34,485		34,485		-		32,060		32,060
Consolidated Furniture and Accessories revenue	$	198,680	$	286,921	$	485,601	$	183,059	$	247,827	$	430,886	$	125,728	$	211,944	$	337,672

(1) Includes the sale of goods other than Bassett-branded products, such as accessories and bedding, and also includes the sale of furniture protection plans.

(2) Beginning with the fourth quarter of fiscal 2022, our retail segment includes the sales of Noa Home, which was acquired on September 2, 2022 (see Note 3).

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Schedule II - Analysis of Valuation and Qualifying Accounts

12 Months Ended

Nov. 26, 2022

Notes to Financial Statements

SEC Schedule, 12-09, Schedule of Valuation and Qualifying Accounts Disclosure [Text Block]

Bassett Furniture Industries, Incorporated

Schedule II

Analysis of Valuation and Qualifying Accounts

For the Years Ended November 26, 2022, November 27, 2021 and November 28, 2020

(amounts in thousands)

	Balance Beginning of Period		Additions Charged to Cost and Expenses			Deductions (1)			Other		Balance End of Period
For the Year Ended November 28, 2020:
Reserve deducted from assets to which it applies
Allowance for doubtful accounts	$	725	$	329		$	(149	)	$	-	$	905
Notes receivable valuation reserves	$	359	$	-		$	-		$	-	$	359
For the Year Ended November 27, 2021:
Reserve deducted from assets to which it applies
Allowance for doubtful accounts	$	905	$	(161	)	$	(177	)	$	-	$	567
Notes receivable valuation reserves	$	359	$	-		$	-		$	-	$	359
For the Year Ended November 26, 2022:
Reserve deducted from assets to which it applies
Allowance for doubtful accounts	$	567	$	761		$	(67	)	$	-	$	1,261
Notes receivable valuation reserves	$	359	$	-		$	(359	)	$	-	$	-
Income tax valuation allowance	$	-	$	1,339		$	-		$	-	$	1,339

(1) Deductions are for the purpose for which the reserve was created.

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Significant Accounting Policies (Policies)	12 Months Ended
	Nov. 26, 2022
Accounting Policies [Abstract]
Basis of Accounting, Policy [Policy Text Block]	Basis of Presentation and Principles of ConsolidationThe Consolidated Financial Statements include the accounts of Bassett Furniture Industries, Incorporated and our majority-owned subsidiaries in which we have a controlling interest. All significant intercompany balances and transactions are eliminated in consolidation. The financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). Unless otherwise indicated, references in the Consolidated Financial Statements to fiscal 2022, 2021 and 2020 are to Bassett's fiscal year ended November 26, 2022, November 27, 2021 and November 28, 2020, respectively. References to the “ASC” included hereinafter refer to the Accounting Standards Codification established by the Financial Accounting Standards Board as the source of authoritative GAAP.We analyzed our licensees under the requirements for variable interest entities (“VIEs”). All of these licensees operate as BHF stores and are furniture retailers. We sell furniture to these licensees, and in some cases have extended credit beyond normal terms, made lease guarantees, guaranteed loans, or loaned directly to the licensees. We have recorded reserves for potential exposures related to these licensees. See Note 15 for disclosure of leases and lease guarantees. Based on financial projections and best available information, all licensees have sufficient equity to carry out their principal operating activities without subordinated financial support. Furthermore, we believe that the power to direct the activities that most significantly impact the licensees’ operating performance continues to lie with the ownership of the licensee dealers. Our rights to assume control over or otherwise influence the licensees’ significant activities only exist pursuant to our license and security agreements and are in the nature of protective rights as contemplated under ASC Topic 810. We completed our assessment for other potential VIEs and concluded that there were none. We will continue to reassess the status of potential VIEs including when facts and circumstances surrounding each potential VIE change.We were the primary beneficiary of one VIE by virtue of our control over the activities that most significantly impact the entity’s economic performance. This VIE was created to affect a Section 1031 like-kind exchange involving the purchase of real property in the state of Florida and the sale of real property in the state of Texas (see Note 14). Subsequent to the completion of the exchange transactions during the third quarter of fiscal 2022, the sole equity interest in the VIE was transferred to Bassett and the entity is now consolidated as a wholly owned subsidiary.On January 31, 2022, we entered into a definitive agreement to sell substantially all of the assets of our wholly-owned subsidiary, Zenith Freight Lines, LLC (“Zenith”) to J.B. Hunt Transport Services, Inc. (“J.B. Hunt”). The sale was completed on February 28, 2022. Accordingly, the operations of our logistical services segment as well as the gain realized upon disposal are presented in the accompanying condensed consolidated statements of income as discontinued operations, and the assets sold to and liabilities assumed by J.B. Hunt are presented in the accompanying condensed consolidated balance sheet as of November 27, 2021 as assets and liabilities of discontinued operations held for sale. See Note 18 for additional information. Costs incurred by Bassett for logistical services performed for Bassett by Zenith are included in selling, general and administrative expenses.On September 2, 2022, we acquired 100% of the capital stock of Noa Home Inc. (“Noa Home”), a mid-priced e-commerce furniture retailer headquartered in Montreal, Canada. Noa Home has operations in Canada, Australia, Singapore and the United Kingdom. Since acquisition, Noa Home has been consolidated as a wholly-owned subsidiary. See Note 3 for additional information.
Use of Estimates, Policy [Policy Text Block]	Use of EstimatesThe preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Some of the more significant estimates include allowances for doubtful accounts, calculation of inventory reserves, the valuation of our reporting units for the purpose of testing the carrying value of goodwill, and the valuation of our right of use assets. We also utilize estimates in determining the valuation of income tax reserves, lease guarantees, insurance reserves, and assumptions related to our post-employment benefit obligations. Actual results could differ from those estimates.
Revenue from Contract with Customer [Policy Text Block]	Revenue RecognitionASC Topic 606, Revenue from Contracts with Customers, requires a company to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration the company expects to receive in exchange for those goods or services. For our wholesale and retail segments, revenue is recognized when the risks and rewards of ownership and title to the product have transferred to the buyer.At wholesale, transfer occurs and revenue is recognized upon the shipment of goods to independent dealers and licensee-owned BHF stores. We offer payment terms varying from 30 to 60 days for wholesale customers. Estimates for returns and allowances have been recorded as a reduction of revenue based on our historical return patterns. The contracts with our licensee store owners do not provide for any royalty or license fee to be paid to us.At retail, transfer occurs and revenue is recognized upon delivery of goods to the customer. We typically collect a significant portion of the purchase price as a customer deposit upon order, with the balance typically collected upon delivery. These deposits are carried on our balance sheet as a current liability until delivery is fulfilled and amounted to $35,963 and $51,492 as of November 26, 2022 and November 27, 2021, respectively. Substantially all of the customer deposits held at November 27, 2021 related to performance obligations were satisfied during fiscal 2022 and have therefore been recognized in revenue for the year ended November 26, 2022. Estimates for returns and allowances have been recorded as a reduction of revenue based on our historical return patterns. We also sell furniture protection plans to our retail customers on behalf of a third party which is responsible for the performance obligations under the plans. Revenue from the sale of these plans is recognized upon delivery of the goods net of amounts payable to the third-party service provider.Sales commissions are expensed as part of selling, general and administrative expenses at the time revenue is recognized because the amortization period would have been one year or less. Sales commissions at wholesale are accrued upon the shipment of goods. Sales commissions at retail are accrued at the time a sale is written (i.e. – when the customer’s order is placed) and are carried as prepaid commissions in other current assets until the goods are delivered and revenue is recognized. At November 26, 2022 and November 27, 2021, our balance of prepaid commissions included in other current assets was $3,768 and $6,221, respectively.For our accounting and reporting under ASC 606, we apply the following policy elections and practical expedients:See Note 20 for disaggregated revenue information.

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Note 2 - Significant Accounting Policies (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Schedule Of Aggregate Exposure From Receivables And Guarantees Related To Customers [Table Text Block]

	2022		2021
Accounts receivable, net of allowances (Note 5)	$	17,838	$	20,567
Contingent obligations under lease and loan guarantees, less amounts recognized (Note 15)		1,828		1,794
Other		43		86
Total credit risk exposure related to customers	$	19,709	$	22,447

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Note 3 - Business Combinations (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Schedule of Business Acquisitions, by Acquisition [Table Text Block]

Fair value of consideration transferred in exchange for 100% of Noa Home:
Cash	$	5,878
Fair value of contingent consideration payable		1,375
Total fair value of consideration paid or payable	$	7,253
Allocation of the fair value of consideration transferred:
Identifiable assets acquired:
Cash	$	296
Inventory		1,585
Other current assets		317
Property & equipment		155
Intangible asset - trade name		1,929
Total identifiable assets acquired		4,282
Liabilities assumed:
Accounts payable		(1,227	)
Customer deposits		(1,059	)
Other current liabilities and accrued expenses		(458	)
Total liabilities assumed		(2,744	)
Net identifiable assets acquired		1,538
Goodwill		5,715
Total net assets acquired	$	7,253

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Note 5 - Accounts Receivable (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Schedule Of Accounts Receivable [Table Text Block]

	November 26, 2022			November 27, 2021
Gross accounts receivable	$	19,099		$	21,134
Allowance for credit losses		(1,261	)		(567	)
Net accounts receivable	$	17,838		$	20,567

Financing Receivable, Current, Allowance for Credit Loss [Table Text Block]

	2022			2021
Balance, beginning of the year	$	567		$	905
Additions (recoveries) charged to expense		761			(161	)
Reductions to allowance, net		(67	)		(177	)
Balance, end of the year	$	1,261		$	567

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Note 6 - Inventories (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Schedule of Inventory, Current [Table Text Block]

	November 26, 2022			November 27, 2021
Wholesale finished goods	$	46,607		$	40,254
Work in process		620			482
Raw materials and supplies		22,859			21,653
Retail merchandise		32,974			30,914
Total inventories on first-in, first-out method		103,060			93,303
LIFO adjustment		(12,416	)		(10,483	)
Reserve for excess and obsolete inventory		(5,167	)		(4,816	)
	$	85,477		$	78,004

Activity In Reserves For Excess Quantities And Obsolete Inventory By Segment [Table Text Block]

	Wholesale Segment			Retail Segment			Total
Balance at November 28, 2020	$	3,421		$	1,101		$	4,522
Additions charged to expense		2,057			912			2,969
Write-offs		(1,795	)		(880	)		(2,675	)
Balance at November 27, 2021		3,683			1,133			4,816
Additions charged to expense		2,577			1,071			3,648
Write-offs		(2,157	)		(1,140	)		(3,297	)
Balance at November 26, 2022	$	4,103		$	1,064		$	5,167

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Note 7 - Property and Equipment (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Property, Plant and Equipment [Table Text Block]

	November 26, 2022			November 27, 2021
Land	$	10,866		$	8,538
Buildings and leasehold improvements		116,418			107,975
Machinery and equipment		101,153			94,521
Property and equipment at cost		228,437			211,034
Less accumulated depreciation		(151,436	)		(141,866	)
Property and equipment, net	$	77,001		$	69,168

Schedule of Property Plant and Equipment by Reporting Segment [Table Text Block]

	November 26, 2022		November 27, 2021
Wholesale	$	36,502	$	30,020
Retail - Company-owned stores		40,499		39,148
Total property and equipment, net	$	77,001	$	69,168

Schedule of Depreciation [Table Text Block]

	2022		2021		2020
Cost of goods sold (wholesale segment)	$	2,082	$	1,797	$	1,552
Selling, general and adminstrative expenses:
Wholesale segment		2,154		1,532		1,516
Retail segment		5,750		6,580		6,578
Total included in selling, general and adminstrative expenses		7,904		8,112		8,094
Total depreciation expense included in income from operations	$	9,986	$	9,909	$	9,646

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Note 8 - Goodwill and Other Intangible Assets (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Schedule of Intangible Assets and Goodwill [Table Text Block]

	November 26, 2022
	Gross Carrying Amount		Accumulated Amortization			Intangible Assets, Net
Intangibles subject to amortization:
Customer relationships	$	512	$	(280	)	$	232
Intangibles not subject to amortization:
Trade names							8,723
Goodwill							12,772
Total goodwill and other intangible assets						$	21,727

Schedule of Goodwill [Table Text Block]

	Wholesale		Retail			Total
Balance as of November 28, 2020	$	7,217	$	-		$	7,217
No changes in fiscal 2021		-		-			-
Balance as of November 27, 2021		7,217		-			7,217
Acquisition of Noa Home		-		5,715			5,715
Foreign currency translation adjustment		-		(161	)		(161	)
Balance as of November 26, 2022	$	7,217	$	5,554		$	12,771

Schedule of Finite-Lived Intangible Assets [Table Text Block]

	Useful Life in Years		Remaining Amortization Period in Years
Customer relationships		9		4

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

Fiscal 2023	$	57
Fiscal 2024		57
Fiscal 2025		57
Fiscal 2026		57
Fiscal 2027		4
Total	$	232

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Note 10 - Post-employment Benefit Obligations (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Schedule of Changes in Projected Benefit Obligations [Table Text Block]

`	2022			2021
Change in Benefit Obligation:
Projected benefit obligation at beginning of year	$	10,740		$	10,071
Service cost		36			120
Interest cost		231			196
Actuarial (gains) and losses		(2,503	)		762
Benefits paid		(1,242	)		(409	)
Projected benefit obligation at end of year	$	7,262		$	10,740
Accumulated Benefit Obligation	$	7,262		$	10,740
Discount rate used to value the ending benefit obligations:		5.38	%		2.25	%
Amounts recognized in the consolidated balance sheet:
Current liabilities	$	698		$	913
Noncurrent liabilities		6,564			9,827
Total amounts recognized	$	7,262		$	10,740
Amounts recognized in accumulated other comprehensive income:
Prior service cost	$	229		$	355
Actuarial (gain) loss		(543	)		2,093
Net amount recognized	$	(314	)	$	2,448
Total recognized in net periodic benefit cost and accumulated other comprehensive income:	$	(2,236	)	$	1,078

Schedule of Net Benefit Costs [Table Text Block]

	2022			2021			2020
Components of Net Periodic Pension Cost:
Service cost	$	36		$	121		$	172
Interest cost		231			196			268
Amortization of prior service cost		126			126			126
Amortization of other loss		133			59			8
Net periodic pension cost	$	526		$	502		$	574
Assumptions used to determine net periodic pension cost:
Discount rate		2.25	%		2.00	%		2.75	%
Increase in future compensation levels		3.00	%		3.00	%		3.00	%

Defined Benefit Plan, Assumptions [Table Text Block]

Estimated Future Benefit Payments (with mortality):
Fiscal 2023	$	698
Fiscal 2024		667
Fiscal 2025		715
Fiscal 2026		683
Fiscal 2027		691
Fiscal 2028 through 2032		3,135

Schedule of Expected Benefit Payments [Table Text Block]

Prior service cost	$	126
Other loss		(1	)
Total expected to be amortized to net periodic pension cost in 2023	$	125

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Note 11 - Accumulated Other Comprehensive Loss (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

Balance at November 28, 2020	$	(1,394	)
Actuarial losses		(762	)
Net pension amortization reclassified from accumulated other comprehensive loss		186
Tax effects		147
Balance at November 27, 2021		(1,823	)
Actuarial gains		2,503
Net pension amortization reclassified from accumulated other comprehensive loss		256
Foreign currency translation adjustment		(272	)
Tax effects		(614	)
Balance at November 26, 2022	$	50

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Note 12 - Capital Stock and Stock Compensation (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Table Text Block]

	2022		2021		2020
Stock based compensation expense	$	538	$	158	$	420

Share-Based Payment Arrangement, Option, Activity [Table Text Block]

	2022		2021		2020
Total intrinsic value of options exercised	$	-	$	93	$	-
Total cash received from the exercise of options		-		42		-
Excess tax benefits recognized in income tax expense upon the exercise of options		-		18		-

Schedule of Share-based Compensation, Summary of Additional Stock Option Information [Table Text Block]

	Number of Shares			Weighted Average Grant Date Fair Value Per Share
Non-vested restricted shares outstanding at November 27, 2021		10,605		$	21.24
Granted		67,099			16.27
Vested		(10,605	)		21.24
Non-vested restricted shares outstanding at November 26, 2022		67,099		$	16.27

Schedule of Nonvested Share Activity [Table Text Block]

					Remaining
	Restricted		Share Value		Restriction
Grant	Shares		at Grant Date		Period
Date	Outstanding		Per Share		(Years)
January 12, 2022		51,300	$	15.82		2.1
March 9, 2022		15,799		17.72		0.3
		67,099

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Note 13 - Income Taxes (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

	2022		2021		2020
Current:
Federal	$	5,659	$	4,507	$	(8,233	)
State		2,154		171		148
Deferred:
Federal		484		60		2,067
State		405		1,098		(518	)
Total	$	8,702	$	5,836	$	(6,536	)

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

	2022			2021			2020
Statutory federal income tax rate		21.0	%		21.0	%		21.0	%
Adjustments to state net operating CARES Act benefit		-			-			19.2
State income tax, net of federal benefit		4.4			4.2			1.7
Impairment of non-deductible goodwill		-			-			(2.5	)
Excess tax from stock-based compensation		-			0.4			(0.6	)
Other		0.1			(0.1	)		(2.5	)
Effective income tax rate		25.5	%		25.5	%		36.3	%

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

	November 26, 2022			November 27, 2021
Deferred income tax assets:
Trade accounts receivable	$	315		$	199
Inventories		3,782			3,121
Notes receivable		-			44
Post employment benefit obligations		2,734			3,562
State net operating loss carryforwards		9			153
Foreign net operating loss carryforwards		1,339			-
Operating lease liabilities		29,423			34,813
Other		1,713			1,180
Gross deferred income tax assets		39,315			43,072
Valuation allowance		(1,339	)		-
Total deferred income tax assets		37,976			43,072
Deferred income tax liabilities:
Property and equipment		5,532			7,013
Intangible assets		726			1,712
Operating lease assets		25,166			29,758
Prepaid expenses and other		1,024			1,400
Total deferred income tax liabilities		32,448			39,883
Net deferred income tax assets	$	5,528		$	3,189

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Note 15 - Leases and Lease Guarantees (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Supplemental Lease Disclosures [Table Text Block]

	November 26, 2022		November 27, 2021
Operating leases:
Right of use assets	$	99,472	$	95,955
Lease liabilties, short-term		18,819		20,235
Lease liabilties, long-term		97,477		94,845
Finance leases:
Right of use assets (1)	$	623	$	832
Lease liabilties, short-term (2)		282		254
Lease liabilties, long-term (3)		360		588

Lessee, Supplemental Balance Sheet Information [Table Text Block]

	November 26, 2022		November 27, 2021
Wholesale	$	8,183	$	9,842
Retail		91,289		86,113
Total right of use assets	$	99,472	$	95,955

Lease, Cost [Table Text Block]

	2022			2021			2020
Lease cost:
Operating lease cost	$	24,399		$	24,367		$	24,946
Financing lease cost:
Amortization of right-of-use assets		279			95			-
Interest on lease liabilities		35			15			-
Short-term lease cost		674			387			545
Variable lease cost (net of abatements received)		447			277			(605	)
Sublease income		(1,444	)		(1,292	)		(1,557	)
Total lease cost	$	24,390		$	23,849		$	23,329

Lessee, Operating and Finance Lease, Liability, Maturity [Table Text Block]

	Operating Leases		Financing Leases
Fiscal 2023	$	24,670	$	319
Fiscal 2024		24,458		256
Fiscal 2025		23,172		94
Fiscal 2026		20,506		5
Fiscal 2027		16,222		2
Thereafter		28,839		-
Total lease payments		137,867		676
Less: interest		21,571		34
Total lease obligations	$	116,296	$	642

Lessor, Operating Lease, Payment to be Received, Fiscal Year Maturity [Table Text Block]

Fiscal 2023	$	1,289
Fiscal 2024		879
Fiscal 2025		599
Fiscal 2026		156
Fiscal 2027		-
Thereafter		-
Total minimum future rental income	$	2,923

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Note 17 - Earnings (Loss) Per Share (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	2022		2021		2020
Earnings per share - continuing operations:
Numerator:
Net income (loss) from continuing operations	$	25,360	$	16,921	$	(11,477	)
Denominator:
Denominator for basic income per share - weighted average shares		9,394,873		9,835,829		9,969,616
Effect of dilutive securities*		8,107		7,945		-
Denominator for diluted income per share — weighted average shares and assumed conversions		9,402,980		9,843,774		9,969,616
Basic income (loss) per share - continuing operations:	$	2.70	$	1.72	$	(1.15	)
Diluted income (loss) per share - continuing operations	$	2.70	$	1.72	$	(1.15	)
Earnings per share - discontinued operations:
Numerator:
Net income from discontinued operations	$	39,985	$	1,121	$	1,056
Denominator:
Denominator for basic income per share - weighted average shares		9,394,873		9,835,829		9,969,616
Effect of dilutive securities*		8,107		7,945		-
Denominator for diluted income per share — weighted average shares and assumed conversions		9,402,980		9,843,774		9,969,616
Basic income per share - discontinued operations	$	4.26	$	0.11	$	0.11
Diluted income per share - discontinued operations	$	4.26	$	0.11	$	0.11

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]

	2022		2021		2020
Unvested restricted shares		-		-		90,153
Stock options		-		-		5,250

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Note 18 - Discontinued Operations (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Disposal Groups, Including Discontinued Operations [Table Text Block]

Sales price prior to post-closing working capital adjustment	$	86,939
Less:
Amount held in escrow for contingencies related to representations and warranties (1)		1,000
Seller expenses paid at closing		418
Working capital adjustment paid to buyer		987
Net proceeds from the sale (2)	$	84,534

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Note 19 - Segment Information (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Schedule of Segment Reporting Information, by Segment [Table Text Block]

	2022			2021			2020
Sales Revenue
Wholesale sales of furniture and accessories	$	324,569		$	295,329		$	221,075
Less: Sales to retail segment		(125,889	)		(112,270	)		(95,347	)
Wholesale sales to external customers		198,680			183,059			125,728
Retail sales of furniture and accessories		286,921			247,827			211,944
Consolidated net sales of furniture and accessories	$	485,601		$	430,886		$	337,672
Income (loss) from Operations
Wholesale	$	9,286		$	17,490		$	4,587
Retail		21,508			7,044			(9,497	)
Inter-company elimination		(524	)		(277	)		2,610
Asset impairment charges		-			-			(12,184	)
Goodwill impairment charge		-			-			(1,971	)
Litigation expense		-			-			(1,050	)
Gain on sale of real estate		4,595			-			-
Consolidated income from operations	$	34,865		$	24,257		$	(17,505	)
Depreciation and Amortization
Wholesale	$	4,293		$	3,386		$	3,125
Retail		5,750			6,580			6,578
Discontinued operations		1,266			4,631			3,777
Consolidated	$	11,309		$	14,597		$	13,480
Capital Expenditures
Wholesale	$	10,748		$	5,943		$	2,434
Retail		10,548			299			695
Consolidated	$	21,296		$	6,242		$	3,129
Identifiable Assets
Wholesale	$	215,748		$	196,910		$	180,235
Retail		190,525			160,929			169,105
Discontinued operations		-			63,821			53,209
Consolidated	$	406,273		$	421,660		$	402,549

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Note 20 - Revenue Recognition (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

Disaggregation of Revenue [Table Text Block]

	2022						2021						2020
	Wholesale		Retail (2)		Total		Wholesale		Retail		Total		Wholesale		Retail		Total
Bassett Custom Upholstery	$	124,565	$	163,755	$	288,320	$	105,445	$	139,527	$	244,972	$	71,840	$	112,888	$	184,728
Bassett Leather		35,953		1,707		37,660		36,157		226		36,383		20,487		2,326		22,813
Bassett Custom Wood		22,534		43,208		65,742		24,079		30,931		55,010		19,682		28,942		48,624
Bassett Casegoods		15,628		40,146		55,774		17,378		42,658		60,036		13,719		35,728		49,447
Accessories, mattresses and other (1)		-		38,105		38,105		-		34,485		34,485		-		32,060		32,060
Consolidated Furniture and Accessories revenue	$	198,680	$	286,921	$	485,601	$	183,059	$	247,827	$	430,886	$	125,728	$	211,944	$	337,672

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Schedule II - Analysis of Valuation and Qualifying Accounts (Tables)

12 Months Ended

Nov. 26, 2022

Notes Tables

SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Table Text Block]

	Balance Beginning of Period		Additions Charged to Cost and Expenses			Deductions (1)			Other		Balance End of Period
For the Year Ended November 28, 2020:
Reserve deducted from assets to which it applies
Allowance for doubtful accounts	$	725	$	329		$	(149	)	$	-	$	905
Notes receivable valuation reserves	$	359	$	-		$	-		$	-	$	359
For the Year Ended November 27, 2021:
Reserve deducted from assets to which it applies
Allowance for doubtful accounts	$	905	$	(161	)	$	(177	)	$	-	$	567
Notes receivable valuation reserves	$	359	$	-		$	-		$	-	$	359
For the Year Ended November 26, 2022:
Reserve deducted from assets to which it applies
Allowance for doubtful accounts	$	567	$	761		$	(67	)	$	-	$	1,261
Notes receivable valuation reserves	$	359	$	-		$	(359	)	$	-	$	-
Income tax valuation allowance	$	-	$	1,339		$	-		$	-	$	1,339

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Note 1 - Description of Business (Details Textual)	Nov. 26, 2022
Number of Stores	91
Percent Of Wholesale Products Sourced From Other Countries	22.00%
Number Of Domestic Manufacturing Facilities	5
Company-owned Retail Stores [Member]
Number of Stores	58
Licensee Operated Retail Stores [Member]
Number of Stores	33

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Note 2 - Significant Accounting Policies (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020	Sep. 02, 2022	Dec. 01, 2019
Contract with Customer, Liability, Total	$ 35,963	$ 51,492
Percent Of Aggregate Risk Exposure Net Of Reserves Attributable To Major Customers	31.00%	24.00%
Percentage of LIFO Inventory	46.00%	53.00%
Non-cash goodwill impairment charge	$ 0	$ 0	$ 1,971
Retained Earnings (Accumulated Deficit), Total	150,800	115,631
Advertising Expense	16,698	15,228	12,619
Deliver Wholesale Merchandise to Customers [Member]
Selling, General and Administrative Expense, Delivery Costs	21,341	17,829	14,779
Deliver Retail Merchandise to Customers [Member]
Selling, General and Administrative Expense, Delivery Costs	23,812	22,494	19,024
Accounting Standards Update 2016-02 [Member]
Lease, Right-of-Use Asset, Net					$ 146,585
Lease, Liability, Net					151,672
Deferred Income Tax Liabilities, Net					1,302
Retained Earnings (Accumulated Deficit), Total					$ 3,785
Non-US [Member]
Revenues, Total	731	488	$ 789
Sales Commissions [Member] | Other Current Assets [Member]
Capitalized Contract Cost, Net, Total	$ 3,768	$ 6,221
Minimum [Member]
Payment Terms For Wholesale Customers	30 days
Minimum [Member] | Building and Building Improvements [Member]
Property, Plant and Equipment, Useful Life	10 years
Minimum [Member] | Machinery and Equipment [Member]
Property, Plant and Equipment, Useful Life	5 years
Minimum [Member] | Real Estate Lease [Member]
Lessee, Operating Lease, Term of Contract	1 year
Lessee, Operating Lease, Renewal Term	5 years
Maximum [Member]
Payment Terms For Wholesale Customers	60 days
Maximum [Member] | Building and Building Improvements [Member]
Property, Plant and Equipment, Useful Life	39 years
Maximum [Member] | Machinery and Equipment [Member]
Property, Plant and Equipment, Useful Life	10 years
Maximum [Member] | Real Estate Lease [Member]
Lessee, Operating Lease, Term of Contract	15 years
Lessee, Operating Lease, Renewal Term	15 years
Noa Home Inc. [Member]
Business Acquisition, Percentage of Voting Interests Acquired				100.00%

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Note 2 - Significant Accounting Policies - Aggregate Exposure from Receivables and Guarantees Related to Customers (Details) - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021
Accounts receivable, net of allowances (Note 5)	$ 17,838	$ 20,567
Contingent obligations under lease and loan guarantees, less amounts recognized (Note 15)	1,828	1,794
Other	43	86
Total credit risk exposure related to customers	$ 19,709	$ 22,447

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Note 3 - Business Combinations (Details Textual) - Noa Home Inc. [Member] $ in Thousands, $ in Thousands			12 Months Ended
	Sep. 02, 2022 USD ($)	Sep. 02, 2022 CAD ($)	Nov. 26, 2022 USD ($)
Business Acquisition, Percentage of Voting Interests Acquired	100.00%
Business Combination, Consideration Transferred, Total	$ 7,253	$ 7,700
Payments to Acquire Businesses, Gross	5,878	2,000
Business Combination, Consideration Transferred, Repayments of Debt		5,700
Business Combination, Additional Consideration, Contingent Annual Payments Based On Performance		$ 1,330
Business Acquisition, Transaction Costs			$ 87
Trade Names [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Indefinite-Lived Intangible Assets	$ 1,929

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Note 3 - Business Combinations - Schedule of Business Acquisitions (Details) $ in Thousands, $ in Millions	Sep. 02, 2022 USD ($)	Sep. 02, 2022 CAD ($)	Nov. 26, 2022 USD ($)	Nov. 27, 2021 USD ($)	Nov. 28, 2020 USD ($)
Goodwill			$ 12,771	$ 7,217	$ 7,217
Noa Home Inc. [Member]
Payments to Acquire Businesses, Gross	$ 5,878	$ 2.0
Fair value of contingent consideration payable	1,375
Total fair value of consideration paid or payable	7,253	$ 7.7
Cash	296
Inventory	1,585
Other current assets	317
Property & equipment	155
Total identifiable assets acquired	4,282
Accounts payable	(1,227)
Customer deposits	(1,059)
Other current liabilities and accrued expenses	(458)
Total liabilities assumed	(2,744)
Net identifiable assets acquired	1,538
Goodwill	5,715
Total net assets acquired	7,253
Noa Home Inc. [Member] | Trade Names [Member]
Intangible asset - trade name	$ 1,929

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Note 4 - Financial Instruments, Investments and Fair Value Measurements (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021
Short-Term Investments, Total	$ 17,715	$ 17,715
Minimum [Member]
Certificates of Deposit, Average Term	6 months
Interest Rate of Certificates of Deposit	0.30%
Maximum [Member]
Certificates of Deposit, Average Term	12 months
Interest Rate of Certificates of Deposit	3.10%
Weighted Average [Member]
Certificates of Deposit, Average Term	3 months
Interest Rate of Certificates of Deposit	2.20%
Certificates of Deposit [Member]
Short-Term Investments, Total	$ 17,715	$ 17,715

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Note 5 - Accounts Receivable - Accounts Receivable (Details) - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021
Gross accounts receivable	$ 19,099	$ 21,134
Allowance for credit losses	(1,261)	(567)
Net accounts receivable	$ 17,838	$ 20,567

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Note 5 - Accounts Receivable - Activity in Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021
Balance, beginning of the year	$ 567	$ 905
Additions (recoveries) charged to expense	761	(161)
Reductions to allowance, net	(67)	(177)
Balance, end of the year	$ 1,261	$ 567

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Note 6 - Inventories (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Purchases From Major Vendors	$ 33,253	$ 34,658	$ 15,378

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Note 6 - Inventories - Inventories (Details) - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Wholesale finished goods	$ 46,607	$ 40,254
Work in process	620	482
Raw materials and supplies	22,859	21,653
Retail merchandise	32,974	30,914
Total inventories on first-in, first-out method	103,060	93,303
LIFO adjustment	(12,416)	(10,483)
Reserve for excess and obsolete inventory	(5,167)	(4,816)	$ (4,522)
Inventory, net	$ 85,477	$ 78,004

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Note 6 - Inventories - Activity in Reserves for Excess Quantities and Obsolete Inventory by Segment (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Balance	$ 4,816	$ 4,522
Additions charged to expense	3,648	2,969	$ 4,922
Write-offs	3,297	2,675
Balance	5,167	4,816	4,522
Operating Segments [Member] | Wholesale Segment [Member]
Balance	3,683	3,421
Additions charged to expense	2,577	2,057
Write-offs	2,157	1,795
Balance	4,103	3,683	3,421
Operating Segments [Member] | Retail Segment [Member]
Balance	1,133	1,101
Additions charged to expense	1,071	912
Write-offs	1,140	880
Balance	$ 1,064	$ 1,133	$ 1,101

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Note 7 - Property and Equipment - Property and Equipment (Details) - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021
Land	$ 10,866	$ 8,538
Buildings and leasehold improvements	116,418	107,975
Machinery and equipment	101,153	94,521
Property and equipment at cost	228,437	211,034
Less accumulated depreciation	(151,436)	(141,866)
Property and equipment, net	$ 77,001	$ 69,168

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Note 7 - Property and Equipment - Summary of Reportable Segment Property and Equipment (Details) - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021
Property and equipment, net	$ 77,001	$ 69,168
Wholesale Segment [Member]
Property and equipment, net	36,502	30,020
Retail Segment [Member]
Property and equipment, net	$ 40,499	$ 39,148

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Note 7 - Property and Equipment - Depreciation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Total depreciation expense included in income from operations	$ 9,986	$ 9,909	$ 9,646
Cost of Sales [Member]
Total depreciation expense included in income from operations	2,082	1,797	1,552
Selling, General and Administrative Expenses [Member]
Total depreciation expense included in income from operations	7,904	8,112	8,094
Selling, General and Administrative Expenses [Member] | Wholesale Segment [Member]
Total depreciation expense included in income from operations	2,154	1,532	1,516
Selling, General and Administrative Expenses [Member] | Retail Segment [Member]
Total depreciation expense included in income from operations	$ 5,750	$ 6,580	$ 6,578

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Note 8 - Goodwill and Other Intangible Assets (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Non-cash goodwill impairment charge	$ 0	$ 0	$ 1,971
Goodwill, Impaired, Accumulated Impairment Loss	$ 3,897	$ 3,897	$ 3,897

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Note 8 - Goodwill and Other Intangible Assets - Goodwill and Other Intangible Assets (Details) - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021
Customer relationships, net	$ 232	$ 232
Trade names	8,723	6,848
Goodwill	12,772	7,217
Total goodwill and other intangible assets	21,727	14,354
Customer Relationships [Member]
Customer relationships, gross	512	512
Customer relationships, accumulated amortization	(280)	(223)
Customer relationships, net	$ 232	$ 289

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Note 8 - Goodwill and Other Intangible Assets - Changes in Carrying Amount of Goodwill by Reportable Segment (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021
Balance	$ 7,217	$ 7,217
No changes in fiscal 2021		0
Acquisition of Noa Home Inc.	5,715
Foreign currency translation adjustment	(161)
Balance	12,771	7,217
Wholesale Segment [Member]
Balance	7,217	7,217
No changes in fiscal 2021		0
Acquisition of Noa Home Inc.	0
Foreign currency translation adjustment	0
Balance	7,217	7,217
Retail Segment [Member]
Balance	0	0
No changes in fiscal 2021		0
Acquisition of Noa Home Inc.	5,715
Foreign currency translation adjustment	(161)
Balance	$ 5,554	$ 0

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Note 8 - Goodwill and Other Intangible Assets - Useful Lives and Remaining Amortization Period of Goodwill and Other Intangible Assets (Details) - Customer Relationships [Member]	12 Months Ended
	Nov. 26, 2022
Finite-lived intangible assets, useful life (Year)	9 years
Finite-lived intangible assets, remianing amortization period (Year)	4 years

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Note 8 - Goodwill and Other Intangible Assets - Estimated Future Amortization Expense for Intangible Assets (Details) - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021
Fiscal 2023	$ 57
Fiscal 2024	57
Fiscal 2025	57
Fiscal 2026	57
Fiscal 2027	4
Total	$ 232	$ 232

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Note 9 - Bank Credit Facility (Details Textual)		12 Months Ended
	Jan. 27, 2022	Nov. 26, 2022 USD ($)
Bank One [Member]
Line of Credit Facility, Maximum Borrowing Capacity		$ 25,000,000
Letters of Credit Outstanding, Amount		3,931,000
Line of Credit Facility, Remaining Borrowing Capacity		$ 21,069,000
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage		0.25%
Debt Instrument, Covenant, Fixed Charge Coverage Ratio	1.4
Debt Instrument, Covenant, Lease-adjusted Leverage Ratio	3.0
Debt Instrument, Covenant, Minimum Tangible Net Worth		$ 140,000
Bank One [Member] | London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument, Basis Spread on Variable Rate		1.50%
Bank Two [Member]
Letters of Credit Outstanding, Amount		$ 250,000

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Note 10 - Post-employment Benefit Obligations (Details Textual) $ in Thousands			12 Months Ended
	May 02, 2017 USD ($)	May 01, 2017	Nov. 26, 2022 USD ($)	Nov. 27, 2021 USD ($)	Nov. 28, 2020 USD ($)
Defined Benefit Plan, Accumulated Other Comprehensive (Income) Loss, before Tax, Total			$ (314)	$ 2,448
Postemployment Benefits Liability, Noncurrent			$ 9,954	12,968
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay			25.00%
Defined Contribution Plan, Maximum Annual Contributions Per Employee, Percent			8.00%
Defined Contribution Plan, Cost			$ 1,108	1,040	$ 548
Unfunded Deferred Compensation Plan [Member]
Pension Cost (Reversal of Cost)			154	204	176
Postemployment Benefits Liability, Noncurrent			1,616	1,648
Management Savings Plan [member]
Defined Benefit Plan, Fixed Future Benefit Award	$ 2,000
Defined Benefit Plan, Fixed Future Benefit Award, Individual Participants	$ 400
Defined Benefit Plan, Benefit Obligation, Number of Annual Installments	10
Payment to Acquire Life Insurance Policy, Operating Activities			853	647	609
Current Net Death Benefit			14,998
Supplemental Employee Retirement Plan [Member]
Deferred Compensation Arrangement with Individual, Deferred Compensation, Maximum Percentage of Base Salary		75.00%
Deferred Compensation Arrangement with Individual, Deferred Compensation, Maximum Percentage of Discretionary, Annual Incentive or Other Bonus		100.00%
Deferred Compensation Arrangement with Individual, Deferred Compensation, Annual installment Payments, Maximum Number of Years		15 years
Deferred Compensation Arrangement with Individual, Deferred Compensation, Scheduled Distributions, Maximum Number of Years		5 years
Deferred Compensation Arrangement with Individual, Compensation Expense			(16)	338	$ 264
Current Net Death Benefit			$ 1,587
Percent Of Final Average Compensation Provided By Supplemental Retirement Income Plan			65.00%
Death Benefit Percent Of Final Average Annual Compensation For Period of 120 Months			50.00%
Death Benefit Payment Term			120 months
Death Benefit Percent Of Final Average Annual Compensation Single Payment			200.00%
Supplemental Employee Retirement Plan [Member] | Non-current Portion of Post Employment Benefits Liability [Member]
Deferred Compensation Arrangement with Individual, Recorded Liability			$ 2,070	$ 1,789

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Note 10 - Post-employment Benefit Obligations - Plan Summary (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Projected benefit obligation at beginning of year	$ 10,740	$ 10,071
Service cost	36	121	$ 172
Interest cost	231	196	268
Actuarial (gains) and losses	(2,503)	762
Benefits paid	(1,242)	(409)
Projected benefit obligation at end of year	7,262	10,740	$ 10,071
Accumulated Benefit Obligation	$ 7,262	$ 10,740
Discount rate used to value the ending benefit obligations:	5.38%	2.25%
Current liabilities	$ 698	$ 913
Noncurrent liabilities	6,564	9,827
Total amounts recognized	7,262	10,740
Prior service cost	229	355
Actuarial (gain) loss	(543)	2,093
Net amount recognized	(314)	2,448
Total recognized in net periodic benefit cost and accumulated other comprehensive income:	$ (2,236)	$ 1,078

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Note 10 - Post-employment Benefit Obligations - Components of Net Periodic Pension Cost (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Service cost	$ 36	$ 121	$ 172
Interest cost	231	196	268
Amortization of prior service cost	126	126	126
Amortization of other loss	133	59	8
Net periodic pension cost	$ 526	$ 502	$ 574
Pension Plan [Member]
Discount rate	2.25%	2.00%	2.75%
Increase in future compensation levels	3.00%	3.00%	3.00%

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Note 10 - Post-employment Benefit Obligations - Assumptions Used in Calculating Net Periodic Pension Cost (Details) $ in Thousands	Nov. 26, 2022 USD ($)
Fiscal 2023	$ 698
Fiscal 2024	667
Fiscal 2025	715
Fiscal 2026	683
Fiscal 2027	691
Fiscal 2028 through 2032	$ 3,135

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Note 10 - Post-employment Benefit Obligations - Estimated Future Benefit Payments (Details) $ in Thousands	Nov. 26, 2022 USD ($)
Prior service cost	$ 126
Other loss	1
Total expected to be amortized to net periodic pension cost in 2023	$ 125

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Note 11 - Accumulated Other Comprehensive Income (Loss) - Activity in Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Balance	$ 162,732	$ 158,030	$ 178,670
Foreign currency translation adjustment	(274)	0	0
Balance	195,609	162,732	158,030
AOCI Attributable to Parent [Member]
Balance	(1,823)	(1,394)	(1,236)
Actuarial losses	2,503	(762)
Net pension amortization reclassified from accumulated other comprehensive loss	256	186
Tax effects	(614)	147
Foreign currency translation adjustment	(272)
Balance	$ 50	$ (1,823)	$ (1,394)

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Note 12 - Capital Stock and Stock Compensation (Details Textual) - USD ($) $ in Thousands		12 Months Ended
	Mar. 01, 2017	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020	Mar. 10, 2021
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Grants in Period, Gross (in shares)		0	0	0
Payment, Tax Withholding, Share-Based Payment Arrangement		$ 19	$ 219	$ 228
Effective Income Tax Rate Reconciliation, Share-based Compensation, Excess Tax Benefit, Amount		(115)	$ (115)	$ (114)
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount, Total		$ 611
Stock Issued During Period, Shares, Employee Stock Purchase Plans		30,074	22,547	50,217
Restricted Stock [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Vested in Period		10,605
Effective Income Tax Rate Reconciliation, Share-based Compensation, Excess Tax Benefit, Amount		$ 1	$ (133)	$ (114)
Restricted Stock [Member] | Employees [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Vested in Period		3,500
Share-Based Payment Arrangement, Shares Withheld for Tax Withholding Obligation		1,225	10,850	14,010
Payment, Tax Withholding, Share-Based Payment Arrangement			$ 219
Restricted Stock [Member] | Director [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Vested in Period		7,105
Plan 2021 [Member]
Common Stock, Capital Shares Reserved for Future Issuance (in shares)					500,000
Plan 2010 [Member] | Restricted Stock [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Vested in Period		10,605
Payment, Tax Withholding, Share-Based Payment Arrangement		$ 19
Employee Stock Purchase Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award, Purchase Price of Common Stock, Percent	85.00%
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Shares Available for Grant		102,460

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Note 12 - Capital Stock and Stock Compensation - Compensation Expense Related to Restricted Stock and Stock Options Included in Selling, General and Administrative Expenses (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Selling, General and Administrative Expenses [Member]
Stock based compensation expense	$ 538	$ 158	$ 420

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Note 12 - Capital Stock and Stock Compensation - Changes in Outstanding Options (Details) - USD ($) $ in Thousands				12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Total intrinsic value of options exercised	$ 0	$ 93	$ 0
Proceeds from exercise of stock options		42	0	$ 0	$ 42	$ 0
Excess tax benefits recognized in income tax expense upon the exercise of options				$ (115)	$ (115)	$ (114)
Share-Based Payment Arrangement, Option [Member]
Excess tax benefits recognized in income tax expense upon the exercise of options	$ 0	$ 18	$ 0

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Note 12 - Capital Stock and Stock Compensation - Additional Information Regarding Activity in Stock Options (Details) - Restricted Stock [Member]	12 Months Ended
	Nov. 26, 2022 $ / shares shares
Non-vested restricted shares outstanding, shares (in shares) | shares	10,605
Non-vested restricted shares outstanding, grant date fair value (in dollars per share) | $ / shares	$ 21.24
Granted, shares (in shares) | shares	67,099
Granted, grant date fair value (in dollars per share) | $ / shares	$ 16.27
Vested, shares (in shares) | shares	10,605
Vested, grant date fair value (in dollars per share) | $ / shares	$ 21.24
Non-vested restricted shares outstanding, shares (in shares) | shares	67,099
Non-vested restricted shares outstanding, grant date fair value (in dollars per share) | $ / shares	$ 16.27

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Note 12 - Capital Stock and Stock Compensation - Changes in Non-vested Options (Details) - Restricted Stock [Member] - $ / shares	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021
Restricted shares outstanding (in shares)	67,099	10,605
Granted, grant date fair value (in dollars per share)	$ 16.27
January 12, 2022 [Member]
Restricted shares outstanding (in shares)	51,300
Granted, grant date fair value (in dollars per share)	$ 15.82
Remaining restriction period (Year)	2 years 1 month 6 days
March 9, 2022 [Member]
Restricted shares outstanding (in shares)	15,799
Granted, grant date fair value (in dollars per share)	$ 17.72
Remaining restriction period (Year)	3 months 18 days

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Note 13 - Income Taxes (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Effective Income Tax Rate Reconciliation, Share-based Compensation, Excess Tax Benefit, Amount	$ 115	$ 115	$ 114
Income Taxes Paid, Net, Total	$ 20,176	$ 3,092	$ 539
Open Tax Year	2018 2019 2020 2021 2022
State and Local Jurisdiction [Member]
Operating Loss Carryforwards	$ 238
State and Local Jurisdiction [Member] | Earliest Tax Year [Member]
Operating Loss Carryforwards, Expiration Year	2030
State and Local Jurisdiction [Member] | Latest Tax Year [Member]
Operating Loss Carryforwards, Expiration Year	2040

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Note 13 - Income Taxes - Components of Income Tax Provision (Benefit) (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Federal	$ 5,659	$ 4,507	$ (8,233)
State	2,154	171	148
Federal	484	60	2,067
State	405	1,098	(518)
Total	$ 8,702	$ 5,836	$ (6,536)

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Note 13 - Income Taxes - Reconciliation of Statutory Federal Income Tax Rate and Effective Income Tax Rate (Details)	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Statutory federal income tax rate	21.00%	21.00%	21.00%
Adjustments to state net operating CARES Act benefit	0.00%	0.00%	19.20%
State income tax, net of federal benefit	4.40%	4.20%	1.70%
Impairment of non-deductible goodwill	0.00%	0.00%	(2.50%)
Excess tax from stock-based compensation	0.00%	0.40%	(0.60%)
Other	0.10%	(0.10%)	(2.50%)
Effective income tax rate	25.50%	25.50%	36.30%

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Note 13 - Income Taxes - Income Tax Effects of Temporary Differences and Carryforwards (Details) - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021
Trade accounts receivable	$ 315	$ 199
Inventories	3,782	3,121
Notes receivable	0	44
Post employment benefit obligations	2,734	3,562
State net operating loss carryforwards	9	153
Foreign net operating loss carryforwards	1,339	0
Operating lease liabilities	29,423	34,813
Other	1,713	1,180
Gross deferred income tax assets	39,315	43,072
Valuation allowance	(1,339)	0
Total deferred income tax assets	37,976	43,072
Property and equipment	5,532	7,013
Intangible assets	726	1,712
Operating lease assets	25,166	29,758
Prepaid expenses and other	1,024	1,400
Total deferred income tax liabilities	32,448	39,883
Net deferred income tax assets	$ 5,528	$ 3,189

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Note 14 - Other Gains and Losses (Details Textual) - USD ($)	3 Months Ended		12 Months Ended
	Aug. 27, 2022	May 28, 2022	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Gain (Loss) on Disposition of Property Plant Equipment, Excluding Oil and Gas Property and Timber Property			$ 4,595,000	$ 0	$ 0
Gain (Loss) on Disposition of Property Plant Equipment, Total			4,595,000	367,000	81,000
Legal Fees			0	$ 0	1,050,000
Gain (Loss) from Company Owned Life Insurance			1,441,000		914,000
Underperforming Retail Stores [Member]
Operating Lease, Impairment Loss					6,239,000
Underperforming Retail Stores [Member]
Asset Impairment Charges, Total					11,114,000
Closed Custom Upholstery Manufacturing Facility in Grand Prairie, Texas [Member]
Asset Impairment Charges, Total					1,070,000
Land and Building occupied by Spring, Texas Retail Store [Member]
Gain (Loss) on Disposition of Property Plant Equipment, Total					$ 1,313,000
Houston, Texas [Member]
Sale of Real Estate, Expected Taxable Gain (Loss)	$ 4,300,000
Tampa Florida [Member]
Payments to Acquire Real Estate, Total		$ 7,668,000
Discontinued Operations, Disposed of by Sale [Member] | Houston, Texas [Member]
Disposal Group, Including Discontinued Operation, Consideration	$ 8,217
Gain (Loss) on Disposition of Property Plant Equipment, Excluding Oil and Gas Property and Timber Property			$ 4,595,000

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Note 15 - Leases and Lease Guarantees (Details Textual) $ in Thousands	12 Months Ended
	Nov. 26, 2022 USD ($) ft²	Nov. 28, 2020 USD ($)	Nov. 27, 2021 USD ($)
Rent Abatement		$ 775
Loss Contingency, Estimate of Possible Loss	$ 1,828		$ 1,794
Lease Obligations of Licensee Operators [Member]
Loss Contingency, Estimate of Possible Loss	$ 1,880		$ 1,845
Post Oak Plaza in Houston, Texas [Member]
Area of Real Estate Property (Square Foot) | ft²	9,597
Lessee, Operating Lease, Lease Not yet Commenced, Term of Contract (Year)	10 years
Lessee, Operating Lease, Lease Not yet Commenced, Monthly Payments	$ 36
Lessee, Operating Lease, Lease Not yet Commenced, Renewal Options	3
Lessee, Operating Lease, Lease Not yet Commenced, Renewal Term (Year)	5 years
Warehouse Space Near Dallas, Texas and Columbus, Ohio [Member]
Area of Real Estate Property (Square Foot) | ft²	61,182
Lessee, Operating Lease, Lease Not yet Commenced, Term of Contract (Year)	5 years
Lessee, Operating Lease, Lease Not yet Commenced, Monthly Payments	$ 41

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Note 15 - Leases and Lease Guarantees - Supplemental Lease Disclosures (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020	Nov. 27, 2022
Right of use assets	$ 99,472	$ 95,955		$ 99,472
Lease liabilties, short-term	18,819	20,235
Lease liabilties, long-term	97,477	94,845
Right of use assets (1)	623	832
Lease liabilties, short-term (2)	282	254
Lease liabilties, long-term (3)	360	588
Cash paid for amounts included in the measurements of lease liabilities, operating	27,011	26,842	$ 26,913
Cash paid for amounts included in the measurements of lease liabilitiesCash paid for amounts included in the measurements of lease liabilities, financing	0	103	302
Lease liabilities arising from new right-of-use assets, operating	8,541	15,678	23,171
Lease liabilities arising from new right-of-use assets, financing	$ 0	$ 927	$ 73
Weighted average remaining lease terms (years), operating (Year)	6 years 2 months 12 days	6 years 3 months 18 days	6 years 4 months 24 days
Weighted average discount rates, operating	5.53%	5.07%	5.00%
Weighted average remaining lease terms (years)Weighted average remaining lease terms (years), financing (Year)	2 years 3 months 18 days	3 years 2 months 12 days
Weighted average discount rates, financing	4.68%	4.63%

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Note 14 - Leases and Lease Guarantees - Right of Use Assets (Details) - USD ($) $ in Thousands	Nov. 27, 2022	Nov. 26, 2022	Nov. 27, 2021
Right of use assets	$ 99,472	$ 99,472	$ 95,955
Wholesale Segment [Member]
Right of use assets	8,183		9,842
Retail Segment [Member]
Right of use assets	$ 91,289		$ 86,113

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Note 15 - Leases and Lease Guarantees - Lease Cost (Details) - USD ($) $ in Thousands			12 Months Ended
	Nov. 27, 2021	Nov. 28, 2020	Nov. 26, 2022
Operating lease cost	$ 24,367	$ 24,946	$ 24,399
Amortization of right-of-use assets	95	0	279
Interest on lease liabilities	15	0	35
Short-term lease cost	387	545	674
Variable lease cost (net of abatements received)	277	(605)	447
Sublease income	(1,292)	(1,557)	(1,444)
Total lease cost	$ 23,849	$ 23,329	$ 24,390

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Note 15 - Leases and Lease Guarantees - Lease Maturities (Details) - USD ($) $ in Thousands	Nov. 26, 2022	Nov. 27, 2021
Fiscal 2023, operating lease	$ 24,670
Fiscal 2023, finance lease		$ 319
Fiscal 2024, operating lease	24,458
Fiscal 2024, finance lease		256
Fiscal 2025, operating lease	23,172
Fiscal 2025, finance lease		94
Fiscal 2026, operating lease	20,506
Fiscal 2026, finance lease		5
Fiscal 2027, operating lease	16,222
Fiscal 2027, finance lease		2
Thereafter, operating lease	28,839
Thereafter, finance lease		0
Total lease payments, operating lease	137,867
Total lease payments, finance lease		676
Less: interest, operating lease	21,571	34
Total operating lease obligations	$ 116,296
Total lease obligations		$ 642

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Note 15 - Leases and Lease Guarantees - Minimum Future Rental Income (Details) $ in Thousands	Nov. 26, 2022 USD ($)
Fiscal 2023	$ 1,289
Fiscal 2024	879
Fiscal 2025	599
Fiscal 2026	156
Fiscal 2027	0
Thereafter	0
Total minimum future rental income	$ 2,923

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Note 17 - Earnings (Loss) Per Share - Reconciliation of Basic and Diluted Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
		Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Net income (loss) from continuing operations		$ 25,360	$ 16,921	$ (11,477)
Denominator for basic income per share - weighted average shares (in shares)		9,394,873	9,835,829	9,969,616
Effect of dilutive securities* (in shares)	[1]	8,107	7,945	0
Denominator for diluted income per share — weighted average shares and assumed conversions (in shares)		9,402,980	9,843,774	9,969,616
Basic income (loss) per share - continuing operations: (in dollars per share)		$ 2.70	$ 1.72	$ (1.15)
Diluted income (loss) per share - continuing operations (in dollars per share)		$ 2.70	$ 1.72	$ (1.15)
Net income from discontinued operations		$ 39,985	$ 1,121	$ 1,056
Denominator for basic income per share - weighted average shares (in shares)		9,394,873	9,835,829	9,969,616
Basic income per share - discontinued operations (in dollars per share)		$ 4.26	$ 0.11	$ 0.11
Diluted income per share - discontinued operations (in dollars per share)		$ 4.26	$ 0.11	$ 0.11

[1] Due to the net losses in 2020, the potentially dilutive securities would have been anti-dilutive and are therefore excluded.

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Note 17 - Earnings (Loss) Per Share - Antidilutive Securities (Details) - shares	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Restricted Stock [Member]
Antidilutive securities (in shares)	0	0	90,153
Share-Based Payment Arrangement, Option [Member]
Antidilutive securities (in shares)	0	0	5,250

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Note 18 - Discontinued Operations (Details Textual) - Discontinued Operations, Disposed of by Sale [Member] - Zenith Freight Lines [Member] - USD ($)	6 Months Ended	12 Months Ended
	Nov. 26, 2022	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax, Net of Working Capital Adjustment	$ 52,534
Disposal Group, Service Agreement with Buyer for Continuation of Services, Term (Year)		7 years
Disposal Group, Including Discontinued Operation, Interest Expense		$ 78,000	$ 289,000	$ 49,000
Logistical Services [Member] | Subsidiaries [Member]
Related Party Transaction, Amounts of Transaction		9,121,000	$ 31,329,000	$ 26,967,000
Disposal Group, Including Discontinued Operation, Operating Expense		27,604,000
Other Current Liabilities and Accrued Expenses [Member]
Disposal Group, Including Discontinued Operation, Reserve for Pre-disposal Workers'' Compensation	$ 639	$ 639

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Note 18 - Discontinued Operations - Disposal Groups, Including Discontinued Operations (Details) - USD ($) $ in Thousands			12 Months Ended
		Feb. 28, 2022	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Net proceeds from the sale (2)			$ 84,534	$ 0	$ 0
Current assets of discontinued operations held for sale			0	11,064
Long-term assets of discontinued operations held for sale			0	52,757
Current liabilities of discontinued operations held for sale			0	16,095
Long-term liabilities of discontinued operations held for sale			0	16,210
Gain on disposal			52,534	0	0
Income tax expense				362	171
Income from discontinued operations, net of tax				1,121	1,056
Discontinued Operations, Disposed of by Sale [Member] | Zenith Freight Lines [Member]
Disposal Group, Including Discontinued Operation, Consideration		$ 86,939
Amount held in escrow for contingencies related to representations and warranties (1)	[1]	1,000
Seller expenses paid at closing		418
Working capital adjustment paid to buyer		987
Net proceeds from the sale (2)		$ 84,534	(81)	(4,508)	(2,900)
Accounts receivable, net			7,601
Other current assets			3,463
Property and equipment, net			24,898
Goodwill and other intangible assets			9,094
Right of use assets under operating leases			18,193
Other			572
Disposal Group, Including Discontinued Operation, Assets, Total			63,821
Current assets of discontinued operations held for sale			11,064
Long-term assets of discontinued operations held for sale			52,757
Accounts payable			4,336
Accrued compensation and benefits			3,295
Current portion operating lease obligations			7,458
Other current liabilites and accrued expenses			1,006
Long-term portion of operating lease obligations			10,996
Other long-term liabilities			5,214
Disposal Group, Including Discontinued Operation, Liabilities, Total			32,305
Current liabilities of discontinued operations held for sale			16,095
Long-term liabilities of discontinued operations held for sale			16,210
Logistical services revenue			16,776	55,648	48,191
Cost of logistical services			15,001	53,905	46,910
Other loss, net			(63)	(260)	(54)
Income from operations of logistical services			1,712	1,483	1,227
Gain on disposal			52,534
Pretax income of discontinued operations			54,246	1,483	1,227
Income tax expense			14,261
Income from discontinued operations, net of tax			39,985
Cash provided by operating activities			1,681	4,082	5,536
Cash used in financing activities			(371)	(1,259)	(121)
Net cash provided by (used in) discontinued operations			$ 1,229	$ (1,685)	$ 2,515

[1] To be held in escrow until the first anniversary of the sale, at which time any amount not distributed or reserved for specified claims will be released to the Company. This amount is included in other current assets in the accompanying condensed consolidated balance sheet at November 26, 2022.

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Note 19 - Segment Information - Segment Information by Segment (Details) - USD ($) $ in Thousands	12 Months Ended
	Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Sales revenues	$ 485,601	$ 430,886	$ 337,672
Net sales of furniture and accessories	485,601	430,886	337,672
Income (loss) from Operations	34,865	24,257	(17,505)
Asset impairment charges	0	0	(12,184)
Goodwill impairment charge	0	0	(1,971)
Litigation expense	0	0	(1,050)
Gain (Loss) on Disposition of Property Plant Equipment, Excluding Oil and Gas Property and Timber Property	4,595	0	0
Depreciation and amortization	11,309	14,597	13,480
Capital expenditures	21,296	6,242	3,129
Identifiable Assets	406,273	421,660	402,549
Discontinued Operations, Disposed of by Sale [Member]
Identifiable Assets	0	63,821	53,209
Wholesale Segment [Member]
Sales revenues	198,680	183,059	125,728
Net sales of furniture and accessories	198,680	183,059	125,728
Furniture and Accessories [Member]
Sales revenues	485,601	430,886	337,672
Net sales of furniture and accessories	485,601	430,886	337,672
Operating Segments [Member] | Discontinued Operations, Disposed of by Sale [Member]
Depreciation and amortization	1,266	4,631	3,777
Operating Segments [Member] | Wholesale Segment [Member]
Sales revenues	324,569	295,329	221,075
Net sales of furniture and accessories	324,569	295,329	221,075
Income (loss) from Operations	9,286	17,490	4,587
Depreciation and amortization	4,293	3,386	3,125
Capital expenditures	10,748	5,943	2,434
Identifiable Assets	215,748	196,910	180,235
Operating Segments [Member] | Retail Segment [Member]
Sales revenues	286,921	247,827	211,944
Net sales of furniture and accessories	286,921	247,827	211,944
Identifiable Assets	190,525	160,929	169,105
Operating Segments [Member] | Retail Segments [Member]
Income (loss) from Operations	21,508	7,044	(9,497)
Depreciation and amortization	5,750	6,580	6,578
Capital expenditures	10,548	299	695
Intersegment Eliminations [Member]
Income (loss) from Operations	(524)	(277)	2,610
Intersegment Eliminations [Member] | Wholesale Segment [Member]
Sales revenues	(125,889)	(112,270)	(95,347)
Net sales of furniture and accessories	$ (125,889)	$ (112,270)	$ (95,347)

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Note 20 - Revenue Recognition - Disaggregated Revenue (Details) - USD ($) $ in Thousands		12 Months Ended
		Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
Net sales of furniture and accessories		$ 485,601	$ 430,886	$ 337,672
Bassett Custom Upholstery [Member]
Net sales of furniture and accessories		288,320	244,972	184,728
Bassett Leather [Member]
Net sales of furniture and accessories		37,660	36,383	22,813
Bassett Custom Wood [Member]
Net sales of furniture and accessories		65,742	55,010	48,624
Bassett Casegoods [Member]
Net sales of furniture and accessories		55,774	60,036	49,447
Accessories, Mattresses and Other [Member]
Net sales of furniture and accessories	[1]	38,105	34,485	32,060
Furniture and Accessories [Member]
Net sales of furniture and accessories		485,601	430,886	337,672
Wholesale Segment [Member]
Net sales of furniture and accessories		198,680	183,059	125,728
Wholesale Segment [Member] | Bassett Custom Upholstery [Member]
Net sales of furniture and accessories		124,565	105,445	71,840
Wholesale Segment [Member] | Bassett Leather [Member]
Net sales of furniture and accessories		35,953	36,157	20,487
Wholesale Segment [Member] | Bassett Custom Wood [Member]
Net sales of furniture and accessories		22,534	24,079	19,682
Wholesale Segment [Member] | Bassett Casegoods [Member]
Net sales of furniture and accessories		15,628	17,378	13,719
Wholesale Segment [Member] | Accessories, Mattresses and Other [Member]
Net sales of furniture and accessories	[1]	0	0	0
Wholesale Segment [Member] | Furniture and Accessories [Member]
Net sales of furniture and accessories		198,680	183,059	125,728
Retail Segment [Member] | Bassett Custom Upholstery [Member]
Net sales of furniture and accessories		163,755	139,527	112,888
Retail Segment [Member] | Bassett Leather [Member]
Net sales of furniture and accessories		1,707	226	2,326
Retail Segment [Member] | Bassett Custom Wood [Member]
Net sales of furniture and accessories		43,208	30,931	28,942
Retail Segment [Member] | Bassett Casegoods [Member]
Net sales of furniture and accessories		40,146	42,658	35,728
Retail Segment [Member] | Accessories, Mattresses and Other [Member]
Net sales of furniture and accessories	[1]	38,105	34,485	32,060
Retail Segment [Member] | Furniture and Accessories [Member]
Net sales of furniture and accessories		$ 286,921	$ 247,827	$ 211,944

[1] Includes the sale of goods other than Bassett-branded products, such as accessories and bedding, and also includes the sale of furniture protection plans.

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Schedule II - Analysis of Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands		12 Months Ended
		Nov. 26, 2022	Nov. 27, 2021	Nov. 28, 2020
SEC Schedule, 12-09, Allowance, Credit Loss [Member]
Balance Beginning of Period		$ 567	$ 905	$ 725
Additions Charged to Cost and Expenses		761	(161)	329
Deductions	[1]	(67)	(177)	(149)
Other		0	0	0
Balance End of Period		1,261	567	905
SEC Schedule, 12-09, Allowance, Notes Receivable [Member]
Balance Beginning of Period		359	359	359
Additions Charged to Cost and Expenses		0	0	0
Deductions	[1]	(359)	0	0
Other		0	0	0
Balance End of Period		0	359	$ 359
SEC Schedule, 12-09, Valuation Allowance, Deferred Tax Asset [Member]
Balance Beginning of Period		0
Additions Charged to Cost and Expenses		1,339
Deductions	[1]	0
Other		0
Balance End of Period		$ 1,339	$ 0

[1] Deductions are for the purpose for which the reserve was created.