EX-99.1 2 d801003dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

NOBILITY HOMES, INC. ANNOUNCES INCREASED SALES AND EARNINGS FOR ITS THIRD QUARTER 2019

Ocala, FL…September 9, 2019—Today Nobility Homes, Inc. (OTCQX: NOBH) announced sales and earnings for its third quarter ended August 3, 2019. Sales for the third quarter of 2019 were up 3% to $11,785,366 as compared to $11,447,636 recorded in the third quarter of 2018. Income from operations for the third quarter of 2019 was up 57% to $2,293,141 versus $1,462,392 in the same period a year ago. Net income after taxes was up 104% to $2,543,104 as compared to $1,248,084 for the same period last year. On June 28, 2019 the Company sold its former Pace retail sales center property located in Pace, Florida for total net proceeds of $1,078,325. The Company recognized a gain on the sale of this property of $864,887. Diluted earnings per share for the third quarter of 2019 were $0.67 per share compared to $0.32 per share last year.

For the first nine months of fiscal 2019, sales were up 19% to $35,567,828 as compared to $30,015,718 for the first nine months of 2018. Income from operations was up 66% to $6,200,698 versus $3,744,496 last year. Net income after taxes was up 73% to $5,898,635 compared to $3,399,925 last year. Diluted earnings per share were $1.53 per share compared to $0.87 per share last year.

Nobility’s financial position for the first nine months of 2019 remains very strong with cash and cash equivalents, certificates of deposit and short term investments of $31,762,269 and no outstanding debt. Working capital is $37,042,814 and our ratio of current assets to current liabilities is 5.9:1. Stockholders’ equity is $48,246,860 and the book value per share of common stock outstanding increased to $12.88.

Terry Trexler, President, stated, “The demand for affordable manufactured housing in Florida continues to be strong. According to the Florida Manufactured Housing Association, shipments in Florida for the period from November 2018 through July 2019 were up approximately 19.4% from the same period last year. Constrained consumer credit and the lack of lenders in our industry, partly as a result of an increase in government regulations, still affects our results by limiting many affordable manufactured housing buyers from purchasing homes. However, legislation may help improve this situation in the future.

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

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

On June 5, 2019 the Company celebrated its 52nd anniversary in business specializing in the design and production of quality, affordable manufactured homes. With multiple retail sales centers, an insurance agency subsidiary, and an investment in a retirement manufactured home community, we are the only vertically integrated manufactured home company headquartered in Florida.

MANAGEMENT WILL NOT HOLD A CONFERENCE CALL. IF YOU HAVE ANY QUESTIONS, PLEASE CALL TERRY OR TOM TREXLER @ 800-476-6624 EXT 121 OR TERRY@NOBILITYHOMES.COM OR TOM@NOBILITYHOMES.COM

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


NOBILITY HOMES, INC.

Condensed Consolidated Balance Sheets

 

     August 3,
2019
    November 3,
2018
 
  

 

 

   

 

 

 
     (Unaudited)        

Assets

    

Current assets:

    

Cash and cash equivalents

   $ 21,146,880     $ 28,364,861  

Certificates of Deposit

     10,118,833       6,034,093  

Short-term investments

     496,556       537,767  

Accounts receivable—trade

     1,993,058       1,783,073  

Note receivable

     67,899       46,444  

Mortgage notes receivable

     17,317       15,664  

Inventories

     9,070,508       7,270,550  

Pre-owned homes, net

     499,463       933,640  

Prepaid expenses and other current assets

     1,238,456       1,090,152  
  

 

 

   

 

 

 

Total current assets

     44,648,970       46,076,244  

Property, plant and equipment, net

     4,900,716       4,763,566  

Pre-owned homes, net

     793,671       473,191  

Note receivable, less current portion

     42,047       46,265  

Mortgage notes receivable, less current portion

     233,247       236,402  

Other investments

     1,631,721       1,571,166  

Property held for sale

     —         213,437  

Deferred income taxes

     —         40,156  

Cash surrender value of life insurance

     3,572,974       3,437,974  

Other assets

     156,287       156,287  
  

 

 

   

 

 

 

Total assets

   $ 55,979,633     $ 57,014,688  
  

 

 

   

 

 

 

Liabilities and Stockholders' Equity

    

Current liabilities:

    

Accounts payable

   $ 933,587     $ 1,085,095  

Accrued compensation

     768,825       869,657  

Accrued expenses and other current liabilities

     1,943,653       1,349,381  

Income taxes payable

     852,236       579,786  

Customer deposits

     3,107,855       4,064,268  
  

 

 

   

 

 

 

Total current liabilities

     7,606,156       7,948,187  

Deferred income taxes

     126,617       —    
  

 

 

   

 

 

 

Total liabilities

     7,732,773       7,948,187  
  

 

 

   

 

 

 

Commitments and contingent liabilities

    

Stockholders' equity:

    

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

     —         —    

Common stock, $.10 par value, 10,000,000 shares authorized;
5,364,907 shares issued; 3,746,570 and 3,873,731 outstanding, respectively

     536,491       536,491  

Additional paid in capital

     10,686,657       10,670,848  

Retained earnings

     52,386,965       50,352,546  

Accumulated other comprehensive income

     349,999       390,407  

Less treasury stock at cost, 1,618,337 shares in 2019 and
1,491,176 shares in 2018

     (15,713,252     (12,883,791
  

 

 

   

 

 

 

Total stockholders' equity

     48,246,860       49,066,501  
  

 

 

   

 

 

 

Total liabilities and stockholders' equity

   $ 55,979,633     $ 57,014,688  
  

 

 

   

 

 

 


NOBILITY HOMES, INC.

Condensed Consolidated Statements of Income and Comprehensive Income

(Unaudited)

 

     Three Months Ended     Nine Months Ended  
     August 3,
2019
    August 4,
2018
    August 3,
2019
    August 4,
2018
 

Net sales

   $ 11,785,366     $ 11,447,636     $ 35,567,828     $ 30,015,718  

Cost of sales

     (8,139,910     (8,705,847     (25,506,957     (22,745,684
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     3,645,456       2,741,789       10,060,871       7,270,034  

Selling, general and administrative expenses

     (1,352,315     (1,279,397     (3,860,173     (3,525,538
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

     2,293,141       1,462,392       6,200,698       3,744,496  
  

 

 

   

 

 

   

 

 

   

 

 

 

Other income:

        

Interest income

     134,526       99,594       431,995       216,977  

Undistributed earnings in joint venture—Majestic 21

     19,800       28,602       60,555       78,917  

Proceeds received under escrow arrangement

     76,734       117,271       289,341       172,911  

Gain on sale of assets

     864,887       —         880,129       203,512  

Miscellaneous

     10,834       10,083       33,714       22,667  
  

 

 

   

 

 

   

 

 

   

 

 

 

Total other income

     1,106,781       255,550       1,695,734       694,984  
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before provision for income taxes

     3,399,922       1,717,942       7,896,432       4,439,480  

Income tax expense

     (856,818     (469,858     (1,997,797     (1,039,555
  

 

 

   

 

 

   

 

 

   

 

 

 

Net income

     2,543,104       1,248,084       5,898,635       3,399,925  

Other comprehensive loss

        

Unrealized investment loss, net of tax effect

     (96,120     (5,046     (40,408     (50,556
  

 

 

   

 

 

   

 

 

   

 

 

 

Comprehensive income

   $ 2,446,984     $ 1,243,038     $ 5,858,227     $ 3,349,369  
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average number of shares outstanding:

        

Basic

     3,807,357       3,873,746       3,848,936       3,925,007  

Diluted

     3,808,617       3,875,897       3,850,169       3,927,066  

Net income per share:

        

Basic

   $ 0.67     $ 0.32     $ 1.53     $ 0.87  

Diluted

   $ 0.67     $ 0.32     $ 1.53     $ 0.87