Nobility Homes, Inc. Announces Sales and Earnings for Its Third Quarter 2024

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Nobility Homes (OTCQX:NOBH) reported its Q3 2024 financial results. Sales decreased to $13.8 million from $14.7 million in Q3 2023. Net income fell to $2.2 million ($0.67 per diluted share) from $2.7 million ($0.80 per share) last year. For the first nine months of 2024, sales were $40.1 million, down from $48.6 million in 2023. Net income decreased to $6.5 million ($2.00 per diluted share) from $8.6 million ($2.56 per share).

The company maintains a strong financial position with $26.5 million in cash and investments and no debt. Challenges include decreased retail home sales, production of lower-priced homes due to higher mortgage rates, supply chain issues, and labor shortages. These factors are expected to impact performance through 2024 and potentially into 2025.

Positive

• Strong financial position with $26.5 million in cash and investments and no outstanding debt
• Working capital of $40.8 million and current ratio of 5.1:1
• Stockholders' equity of $54.5 million and book value per share of $16.67

Negative

• Q3 2024 sales decreased to $13.8 million from $14.7 million in Q3 2023
• Q3 2024 net income fell to $2.2 million from $2.7 million in Q3 2023
• Nine-month 2024 sales decreased to $40.1 million from $48.6 million in 2023
• Nine-month 2024 net income decreased to $6.5 million from $8.6 million in 2023
• Decrease in number of retail homes sold and manufactured
• Building and selling lower-priced homes due to higher mortgage interest rates
• Supply chain issues and labor shortages causing production and set-up delays
• Inflation in building products increasing material and labor costs

OCALA, FL / ACCESSWIRE / September 10, 2024 / Today Nobility Homes, Inc. (OTCQX:NOBH) announced sales and earnings for its third quarter ended August 3, 2024.

Sales for the third quarter of 2024 were $13.8 million as compared to $14.7 million recorded in the third quarter of 2023. Income from operations for the third quarter of 2024 was $2.6 million versus $3.1 million in the same period a year ago. Net income after taxes was $2.2 million as compared to $2.7 million for the same period last year. Diluted earnings for the third quarter of 2024 were $0.67 per share compared to $0.80 per share last year.

For the first nine months of fiscal 2024, sales were $40.1 million as compared to $48.6 million for the nine months of 2023. Income from operations for the nine months of 2024 was $7.5 million versus $10.7 million in the same period last year. Net income after taxes was $6.5 million versus last year's results of $8.6 million. Diluted earnings were $2.00 per share compared to $2.56 per share last year.

Nobility's financial position for the first nine months 2024 remains strong with cash and cash equivalents, certificates of deposit and short-term investments of $26.5 million and no outstanding debt. Working capital is $40.8 million and our ratio of current assets to current liabilities is 5.1:1. Stockholders' equity is $54.5 million and the book value per share of common stock is $16.67.

Terry Trexler, President, stated, "Net sales decreased in the first nine months of 2024 as compared to last year because of the decrease in the number of retail homes sold and manufactured. In addition, we are building and selling lower-priced homes due to the higher interest rates on mortgages that we believe are negatively impacting sales as compared to the prior years. There also remain delays in the receipt of certain key production materials from suppliers, back orders, price increases and labor shortages which continue to cause delays in the completion of the homes at our manufacturing facility and the set-up process of retail homes in the field. Our inability to timely deliver and set up homes to customers has negatively impacted sales and earnings. We expect these challenges will continue throughout the fiscal year 2024 and potentially into 2025. The Company also continues to experience inflation in some building products resulting in increases to our material and labor costs which may increase the wholesale and retail selling prices of our homes. We believe that potential customers have delayed or deferred purchasing decisions when considering the interest rate environment.

The current demand for affordable manufactured housing in Florida and the U.S. has slowed due to the interest rate environment and increased costs associated with mortgages. According to the Florida Manufactured Housing Association, shipments for the industry in Florida for the period from November 2023 through July 2024 declined by approximately 3% from the same period last year.

Maintaining our strong financial position is vital for future growth and success. 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, 2024, the Company celebrated its 57^th anniversary in business specializing in the design and production of quality, affordable manufactured homes. With multiple retail sales centers in Florida for over 34 years and an insurance agency subsidiary, 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 forward-looking statements within the meaning of the federal securities laws. Although Nobility believes that the amounts and 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, the potential adverse impact on our business caused by competitive pricing pressures at both the wholesale and retail levels, inflation, increasing material costs (including forest based products) or availability of materials due to supply chain interruptions (such as current inflation with forest products and supply issues with insulation, shingles, vinyl siding and PVC piping), changes in market demand, increase 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 attacks, or other events such as a pandemic, any armed conflict involving the United States and the impact of inflation.

NOBILITY HOMES, INC.
Condensed Consolidated Balance Sheets

		August 3,				November 4,
		2024				2023
		(Unaudited)
Assets
Current assets:
Cash and cash equivalents		$	13,052,050			$	13,879,358
Certificates of deposit			12,888,834				10,204,287
Short-term investments			618,228				527,899
Accounts receivable - trade			2,053,550				2,864,808
Mortgage notes receivable			3,533				4,391
Income tax receivable			-				-
Inventories			20,387,489				21,518,098
Prepaid expenses and other current assets			1,646,061				1,733,179
Total current assets			50,649,745				50,732,020
Property, plant and equipment, net			8,321,580				8,268,976
Mortgage notes receivable, less current portion			143,313				142,761
Other investments			419,933				1,953,199
Property held for resale			65,470				26,590
Deferred income taxes			113,511				90,274
Cash surrender value of life insurance			4,463,734				4,331,659
Other assets			156,287				156,287
Total assets		$	64,333,573			$	65,701,766
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable		$	838,561			$	819,143
Accrued compensation			972,913				992,622
Accrued expenses and other current liabilities			1,234,530				1,809,335
Income taxes payable			848,089				661,261
Customer deposits			5,948,020				8,703,107
Total current liabilities			9,842,113				12,985,468
Commitments and contingencies
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;
3,268,829 and 3,269,075 shares outstanding, respectively			536,491				536,491
Additional paid in capital			11,097,178				10,964,985
Retained earnings			72,616,229				70,969,764
Less treasury stock at cost, 2,096,078 and
2,095,832 shares, respectively			(29,758,438	)			(29,754,942	)
Total stockholders' equity			54,491,460				52,716,298
Total liabilities and stockholders' equity		$	64,333,573			$	65,701,766

NOBILITY HOMES, INC.
Condensed Consolidated Statements of Income
(Unaudited)

		Three Months Ended								Nine Months Ended
		August 3,				August 5,				August 3,				August 5,
		2024				2023				2024				2023
Net sales		$	13,803,340			$	14,654,789			$	40,099,316			$	48,599,139
Cost of sales			(9,196,740	)			(9,540,399	)			(26,589,976	)			(31,659,842	)
Gross profit			4,606,600				5,114,390				13,509,340				16,939,297
Selling, general and administrative expenses			(2,032,973	)			(1,987,782	)			(5,976,683	)			(6,238,457	)
Operating income			2,573,627				3,126,608				7,532,657				10,700,840
Other income (expense)
Interest income			318,253				203,972				836,113				513,987
Undistributed earnings in joint venture - Majestic 21			24,914				27,828				67,623				76,276
Proceeds received under escrow arrangement			47,339				115,641				147,155				209,806
Increase (decrease) in fair value of equity investment			(11,214	)			81,078				90,329				(47,939	)
Gain on disposal of property, plant and equipment			3,000				-				3,000				-
Miscellaneous			(28,706	)			16,404				96,422				42,766
Total other income			353,586				444,923				1,240,642				794,896
Income before provision for income taxes			2,927,213				3,571,531				8,773,299				11,495,736
Income tax expense			(741,901	)			(905,203	)			(2,223,591	)			(2,913,592	)
Net income		$	2,185,312			$	2,666,328			$	6,549,708			$	8,582,144
Weighted average number of shares outstanding:
Basic			3,268,829				3,323,874				3,268,829				3,354,981
Diluted			3,277,856				3,328,875				3,278,742				3,357,424
Net income per share:
Basic		$	0.67			$	0.80			$	2.00			$	2.56
Diluted		$	0.67			$	0.80			$	2.00			$	2.56

SOURCE: Nobility Homes, Inc.

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FAQ

What were Nobility Homes' (NOBH) Q3 2024 financial results?

Nobility Homes reported Q3 2024 sales of $13.8 million, down from $14.7 million in Q3 2023. Net income was $2.2 million ($0.67 per diluted share), compared to $2.7 million ($0.80 per share) in the same period last year.

How did Nobility Homes (NOBH) perform in the first nine months of fiscal 2024?

For the first nine months of fiscal 2024, Nobility Homes reported sales of $40.1 million, down from $48.6 million in 2023. Net income was $6.5 million ($2.00 per diluted share), compared to $8.6 million ($2.56 per share) in the same period last year.

What challenges is Nobility Homes (NOBH) facing in 2024?

Nobility Homes is facing challenges including decreased retail home sales, production of lower-priced homes due to higher mortgage rates, supply chain issues, labor shortages, and inflation in building materials. These factors are expected to impact performance through 2024 and potentially into 2025.

What is Nobility Homes' (NOBH) financial position as of Q3 2024?

Nobility Homes maintains a strong financial position with $26.5 million in cash and investments, no outstanding debt, working capital of $40.8 million, and a current ratio of 5.1:1. Stockholders' equity is $54.5 million with a book value per share of $16.67.