Bassett Net Leaps on Tax Benefit in Q4
BASSETT, Va.-Rising sales and a net tax benefit or $14.2 million elevated Bassett Furniture Industries' fourth-quarter net income by 2,569 percent, to $16.9 million.
The tax benefit resulted from a $16 million reduction of certain valuation reserves against the company's deferred tax assets. Net sales in the quarter, which ended on Nov. 24, jumped 21.4 percent to $76.8 million, including an 18 percent gain in wholesale sales and a 24 percent gain in sales from the retail segment.
For the fiscal year as a whole, Bassett posted net income of $26.7 million, down 51.7 percent from the prior year. Net sales totaled $269.7 million, an increase of 6.5 percent.
In the fourth quarter, the company's gross margin slimmed by 30 basis points to 52.3 percent. Selling, general and administrative expenses, while gaining 20.2 percent in dollars, were down 50 basis points as a percentage of sales to 49.1 percent.
Robert Spilman Jr., Bassett's president and CEO, said the company's revenue accelerated as 2012 progressed, and have provided momentum for a strong performance in 2013. Spilman cited the company's "much healthier retail network," recent product introductions that have had success at retail, improving retail sales and promising initial sales from products in the company's HGTV Design Studio in the Bassett Home Furnishings store network.