Unassociated Document
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
__________
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF
THE
SECURITIES EXCHANGE ACT OF 1934
Date
of Report (Date of earliest event reported): July 16, 2009
__________
HOOKER
FURNITURE CORPORATION
(Exact
name of registrant as specified in its charter)
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Virginia
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000-25349
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54-0251350
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(State or other jurisdiction
of
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(Commission
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(I.R.S.
Employer
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incorporation or
organization)
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File
No.)
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Identification
No.)
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440 East Commonwealth
Boulevard,
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Martinsville,
Virginia
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24112
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(276)
632-0459
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(Address of principal executive
offices)
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(Zip
Code)
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(Registrant’s telephone
number,
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including area
code)
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Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction A.2.
below):
o Written communications pursuant
to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to
Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
ITEM
8.01. OTHER
EVENTS.
On July
16, 2009, Hooker Furniture Corporation (“Hooker,” the “Company,”
“we,” “us,” or “our”) decided to transition production
from our Bradington-Young Woodleaf, North Carolina frame
manufacturing plant (a leased facility) to Bradington-Young’s Cherryville, North
Carolina facility by the end of December 2009. On July 17, 2009, we
met with the Woodleaf employees and announced our plans to sell the frame
production operation, including the associated machinery and equipment, as an
on-going business. However, if this initiative is not successful we
plan to close the Woodleaf operation, sell the machinery and equipment that
cannot be utilized at our other plants and vacate the facility by the end of
calendar year 2009.
As in
much of the upholstered furniture industry, demand for our domestic upholstery
has declined since 2006, resulting in excess manufacturing capacity and higher
overhead costs as a percent of sales. The current economic recession has
significantly exacerbated this decline since the second half of calendar year
2008. While we believe that maintaining our domestic upholstery
manufacturing capability remains an important part of our comprehensive sourcing
strategy for upholstered furniture, we believe this move will make our domestic
upholstery manufacturing operation more efficient.
The
34,000 square foot Woodleaf operation, under lease until December 2009, employs
23 people in the manufacturing of wood frames for Bradington-Young’s two
upholstered furniture manufacturing plants located in Cherryville and Hickory,
North Carolina. We plan to move frame production to the Cherryville
manufacturing location. During the transition, the Woodleaf plant is
expected to continue servicing Bradington-Young’s frame requirements. We expect
that exiting the Woodleaf operation and moving frame production to Cherryville
will reduce fixed overhead costs by approximately $350,000 to $550,000 annually
(or about $0.02 to $0.03 per share after tax) following the completion of the
transition period.
Woodleaf
employees were also informed that if we are unable to find a buyer for the
Woodleaf operation, we would undertake an orderly shutdown and liquidation of
the operation. Employees would be offered severance pay and other incentives to
remain with the Company during a shutdown phase, if one is
required.
In
connection with exiting this operation, Hooker Furniture expects to record
accelerated depreciation of about $60,000 (less than $0.01 per share after tax)
primarily over the 2010 third and fourth quarters.
If we are
unsuccessful in finding a buyer for the business, and as a result must close the
operation, we expect to record restructuring charges of about $140,000 pretax
(or about $0.01 per share after tax) during the 2010 third quarter, which ends
November 1, 2009, principally for severance and related employee benefits that
would be provided to the terminated Woodleaf employees.
Statements
made in this report, other than those concerning historical information, may be
considered forward-looking statements. These statements are subject
to risks and uncertainties that could cause actual results to differ materially
from those in the forward-looking statements, including but not limited to:
whether and when the Company will be able to sell the assets related to its
Woodleaf operation on terms satisfactory to the Company; current economic
conditions and instability in the financial and credit markets including their
potential impact on the Company’s (i) sales and operating costs and access to
financing and, (ii) customers and suppliers and their ability to obtain
financing or generate the cash necessary to conduct their business; general
economic or business conditions, both domestically and internationally; price
competition in the furniture industry; changes in domestic and international
monetary policies and fluctuations in foreign currency exchange rates affecting
the price of the Company’s imported products; the cyclical nature of the
furniture industry which is particularly sensitive to changes in consumer
confidence, the amount of consumers’ income available for discretionary
purchases and the availability and terms of consumer credit; risks associated
with the cost of imported goods, including fluctuation in the prices of
purchased finished goods and transportation and warehousing costs; supply,
transportation and distribution disruptions, particularly those affecting
imported products; adverse political acts or developments in, or affecting, the
international markets from which the Company imports products, including duties
or tariffs imposed on products imported by the Company; risks associated with
domestic manufacturing operations, including fluctuations in capacity
utilization and the prices of key raw materials, transportation and warehousing
costs, domestic labor costs and environmental compliance and remediation costs;
the Company’s ability to successfully implement its business plans; achieving
and managing growth and change, and the risks associated with acquisitions,
restructurings, strategic alliances and international operations; risks
associated with distribution through retailers, such as non-binding dealership
arrangements; capital requirements and costs; competition from non-traditional
outlets, such as catalogs, internet and home improvement centers; changes in
consumer preferences, including increased demand for lower quality, lower priced
furniture due to declines in consumer confidence and/or discretionary income
available for furniture purchases and the availability of consumer credit; and
higher than expected costs associated with product quality and safety, including
regulatory compliance costs related to the sale of consumer products and costs
related to defective products. Any forward looking statement that the
Company makes speaks only as of the date of that statement, and the Company
undertakes no obligation to update any forward-looking statements whether as a
result of new information, future events, or otherwise.
Signature
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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HOOKER
FURNITURE CORPORATION |
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By:
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/s/ R.
Gary Armbrister |
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R.
Gary Armbrister |
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Chief
Accounting Officer |
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Date: July
17, 2009