OCALA, FL -- (Marketwired) -- 06/10/16 -- Today Nobility Homes, Inc. (OTCQX: NOBH) announced increased sales and earnings results for its second quarter ended April 30, 2016. Sales for second quarter 2016 were up 21% to $8,115,840 as compared to $6,706,118 recorded in second quarter 2015. Income from operations was up 44% to $953,869 versus $660,719 last year. Net income after taxes was $3,671,881 as compared to $680,553 last year. On March 31, 2016, the Company sold its limited partnership interest in CRF III, Ltd. ("Cypress Creek"), a retirement community which resulted in a gain of $3,990,000. We also received revenue of $788,566 in the second quarter of 2016 under an escrow arrangement related to the Finance Revenue Sharing Agreement between 21st Mortgage Corporation, Prestige Home Centers, Inc. and Majestic Homes Inc. Diluted earnings per share were $0.91 per share compared to $.17 per share last year.
For the first six months of fiscal 2016, sales were up 26% to $15,489,890 as compared to $12,282,918 for the first six months of 2015. Income from operations was up 78% to $1,929,610 versus $1,085,539 last year. Net income after taxes was $4,350,282 compared to $1,160,341 last year. Diluted earnings per share were $1.08 per share compared to $.29 per share last year.
Nobility's financial position for the first six months of 2016 remains very strong with cash and cash equivalents and short term investments of $20,614,116 and no outstanding debt. During the second quarter of 2016 the Company received a distribution from the Majestic 21 partnership with 21st Mortgage Corporation in the amount of $1,000,005. Working capital is $29,426,668 and our ratio of current assets to current liabilities is 9.1:1. Stockholders' equity is $43,322,379 and the book value per share of common stock outstanding increased to $10.77.
Terry Trexler, President, stated, "The demand for affordable manufactured housing in Florida and the U.S. is improving. According to the Florida Manufactured Housing Association, shipments in Florida for the period from November 2015 through April 2016 were up approximately 27% from the same period last year. Our sales and earnings continue to be affected by the challenging housing environment, the uncertainty of the U.S. and world economy, employment levels, consumer confidence and, in particular, the lack of available retail and wholesale financing. Constrained consumer credit and the lack of lenders in the industry, partly as a result of an increase in government regulations, have limited many affordable manufactured housing buyers from purchasing homes.
We understand that during this uncertain economic environment, maintaining our strong financial position is vital for future growth and success. Because of the recent years of very challenging business conditions 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."
The Company has specialized for over 49 years in the design and production of quality, affordable manufactured homes at its plant located in central Florida. With multiple retail sales centers, an insurance 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 221 OR TERRY@NOBILITYHOMES.COM OR TOM@NOBILITYHOMES.COM
Certain statements in this report are 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, continued excess retail inventory, increase in repossessions, changes in market demand, changes in interest rates, availability of financing for retail and wholesale purchasers, consumer confidence, adverse weather conditions that reduce sales at retail centers, the risk of manufacturing plant shutdowns due to storms or other factors, the impact of marketing and cost-management programs, reliance on the Florida economy, impact of labor shortage, impact of materials shortage, increasing labor cost, cyclical nature of the manufactured housing industry, impact of rising fuel costs, catastrophic events impacting insurance costs, availability of insurance coverage for various risks to Nobility, market demographics, management's ability to attract and retain executive officers and key personnel, increased global tensions, market disruptions resulting from terrorist or other attack and any armed conflict involving the United States and the impact of inflation.
NOBILITY HOMES, INC.
Consolidated Balance Sheets
April 30, October 31,
2016 2015
----------- -----------
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $20,178,789 $16,769,292
Short-term investments 435,327 462,578
Accounts receivable - trade 2,411,196 2,937,922
Note receivable 500,000 -
Mortgage notes receivable 9,464 9,851
Income tax receivable - 335
Inventories 6,839,285 6,019,705
Pre-owned homes 1,146,105 1,366,974
Prepaid expenses and other current assets 1,039,387 826,180
Deferred income taxes 490,376 655,193
----------- -----------
Total current assets 33,049,929 29,048,030
Property, plant and equipment, net 4,654,212 3,964,878
Pre-owned homes 2,734,203 2,724,190
Interest receivable 7,596 -
Note receivable, less current portion 2,530,000 -
Mortgage notes receivable, long term 175,985 177,644
Other investments 1,312,834 2,243,729
Deferred income taxes - 1,210,630
Cash surrender value of life insurance 3,005,468 2,915,469
Other assets 156,287 156,287
----------- -----------
Total assets $47,626,514 $42,440,857
=========== ===========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 624,645 $ 704,467
Accrued compensation 385,489 390,573
Accrued expenses and other current liabilities 938,612 926,204
Income taxes payable 414,284 -
Customer deposits 1,260,231 1,323,861
----------- -----------
Total current liabilities 3,623,261 3,345,105
Deferred income taxes 680,874 -
----------- -----------
Total liabilities 4,304,135 3,345,105
----------- -----------
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 536,491 536,491
Additional paid in capital 10,661,425 10,650,723
Retained earnings 41,843,359 37,493,077
Accumulated other comprehensive income 220,473 247,724
Less treasury stock at cost, 1,341,200 shares in
2016 and 1,333,338 shares in 2015 (9,939,369) (9,832,263)
----------- -----------
Total stockholders' equity 43,322,379 39,095,752
----------- -----------
Total liabilities and stockholders' equity $47,626,514 $42,440,857
=========== ===========
NOBILITY HOMES, INC.
Consolidated Statements of Comprehensive Income
Unaudited
Three Months Ended Six Months Ended
------------------------ -------------------------
April 30, May 2, April 30, May 2,
2016 2015 2016 2015
----------- ----------- ------------ -----------
Net sales $ 8,115,840 $ 6,706,118 $ 15,489,890 $12,282,918
Cost of goods sold (6,150,272) (5,167,950) (11,767,887) (9,571,981)
----------- ----------- ------------ -----------
Gross profit 1,965,568 1,538,168 3,722,003 2,710,937
Selling, general and
administrative
expenses (1,011,699) (877,449) (1,792,393) (1,625,398)
----------- ----------- ------------ -----------
Operating income 953,869 660,719 1,929,610 1,085,539
----------- ----------- ------------ -----------
Other income (loss):
Interest income 22,044 16,852 34,091 29,972
Undistributed
earnings in joint
venture - Majestic
21 35,702 35,237 69,110 68,815
Proceeds received
under escrow
arrangement 788,566 - 788,566 -
Losses from
investments in
retirement community
limited partnerships - (51,657) - (57,350)
Gain on sale of
investment in
retirement community 3,990,000 - 3,990,000 -
Miscellaneous 10,076 23,696 19,845 38,866
----------- ----------- ------------ -----------
Total other income
(loss) 4,846,388 24,128 4,901,612 80,303
----------- ----------- ------------ -----------
Income before provision
for income taxes 5,800,257 684,847 6,831,222 1,165,842
Income tax expense (2,128,376) (4,294) (2,480,940) (5,501)
----------- ----------- ------------ -----------
Net income 3,671,881 680,553 4,350,282 1,160,341
Other comprehensive
income (loss)
Unrealized investment
gain (loss) 42,388 41,941 (27,251) (29,044)
----------- ----------- ------------ -----------
Comprehensive income $ 3,714,269 $ 722,494 $ 4,323,031 $ 1,131,297
=========== =========== ============ ===========
Weighed average number
of shares outstanding:
Basic 4,023,439 4,061,853 4,024,378 4,062,883
Diluted 4,024,181 4,062,423 4,025,069 4,063,314
Net income per share:
Basic $ 0.91 $ 0.02 $ 1.08 $ 0.29
Diluted $ 0.91 $ 0.17 $ 1.08 $ 0.29
Terry or Tom Trexler
800-476-6624 Ext 221
TERRY@NOBILITYHOMES.COM or TOM@NOBILITYHOMES.COM
