SOURCE: Nobility Homes, Inc.

Nobility Homes, Inc.

March 11, 2016 12:54 ET

Nobility Homes, Inc. Announces Increased Sales and Earnings for Its First Quarter 2016

OCALA, FL--(Marketwired - Mar 11, 2016) -  Today Nobility Homes, Inc. (OTCQX: NOBH) announced increased sales and earnings results for its first quarter ended January 30, 2016. Sales for first quarter 2016 were up 32% to $7,374,050 as compared to $5,576,800 recorded in first quarter 2015. Income from operations for first quarter 2016 was up 130% to $975,741 versus $424,820 in the same period a year ago. Net income after taxes was $678,401 as compared to $479,788 for the same period last year. Diluted earnings per share for first quarter 2016 were $0.17 per share compared to $0.12 per share last year.

Nobility's financial position during first quarter 2016 remains very strong with cash and cash equivalents and short term investments of $17,162,666 and no outstanding debt. Working capital is $25,640,995 and our ratio of current assets to current liabilities is 9.5:1. Stockholders' equity is $39,602,650 and the book value per share of common stock increased to $9.84. 

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 January 2016 were up approximately 33% 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.

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 48 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 investments in retirement manufactured home communities, we are the only vertically integrated manufactured home company headquartered in Florida.


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.

Consolidated Balance Sheets  
    January 30,     October 31,  
    2016     2015  
Current assets:            
  Cash and cash equivalents   $ 16,769,727     $ 16,769,292  
  Short-term investments     392,939       462,578  
  Accounts receivable - trade     2,300,412       2,937,922  
  Mortgage notes receivable, current     10,674       9,851  
  Income tax receivable     10,335       335  
  Inventories     6,488,324       6,019,705  
  Pre-owned homes, current     1,223,496       1,366,974  
  Prepaid expenses and other current assets     767,840       826,180  
  Deferred income taxes     702,014       655,193  
    Total current assets     28,665,761       29,048,030  
Property, plant and equipment, net     4,684,545       3,964,878  
Pre-owned homes     2,898,152       2,724,190  
Mortgage notes receivable, long term     176,821       177,644  
Other investments     2,277,137       2,243,729  
Deferred income taxes     811,245       1,210,630  
Cash surrender value of life insurance     2,957,468       2,915,469  
Other assets     156,287       156,287  
    Total assets   $ 42,627,416     $ 42,440,857  
Liabilities and Stockholders' Equity                
Current liabilities:                
  Accounts payable   $ 533,609     $ 704,467  
  Accrued compensation     310,222       390,573  
  Accrued expenses and other current liabilities     765,905       926,204  
  Customer deposits     1,415,030       1,323,861  
    Total current liabilities     3,024,766       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     10,659,025       10,650,723  
  Retained earnings     38,171,478       37,493,077  
  Accumulated other comprehensive income     178,085       247,724  
  Less treasury stock at cost, 1,341,613 shares in 2016 and 1,333,338 shares in 2015     (9,942,429 )     (9,832,263 )
    Total stockholders' equity     39,602,650       39,095,752  
    Total liabilities and stockholders' equity   $ 42,627,416     $ 42,440,857  
Consolidated Statements of Comprehensive Income  
    Three Months Ended  
    January 30,     January 31,  
    2016     2015  
Net sales   $ 7,374,050     $ 5,576,800  
Cost of goods sold     (5,617,615 )     (4,404,031 )
    Gross profit     1,756,435       1,172,769  
Selling, general and administrative expenses     (780,694 )     (747,949 )
    Operating income     975,741       424,820  
Other income (loss):                
  Interest income     12,047       13,120  
  Undistributed earnings in joint venture - Majestic 21     33,408       33,578  
  Losses from investments in retirement community limited partnerships     -       (5,693 )
  Miscellaneous     9,769       15,170  
    Total other income     55,224       56,175  
Income before provision for income taxes     1,030,965       480,995  
Income tax expense     (352,564 )     (1,207 )
    Net income     678,401       479,788  
Other comprehensive loss                
  Unrealized investment loss     (69,639 )     (70,985 )
  Comprehensive income   $ 608,762     $ 408,803  
Weighed average number of shares outstanding:                
  Basic     4,025,316       4,063,913  
  Diluted     4,025,952       4,064,254  
Net income per share:                
  Basic   $ 0.17     $ 0.12  
  Diluted   $ 0.17     $ 0.12  

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