"The other income of $1.2 million for last year's fourth quarter was for gains on property dispositions.
"Our inventories are up from the 2005 levels which had been admittedly too low to properly serve our customer. We believe that we have reached a manageable breadth of products and have greatly enhanced our supply chain techniques from a year ago. The current business environment does present challenges to maintain an optimal level of inventory given the long lead times from order placement with our suppliers to receipt of the merchandise. We are actively working with our vendors to have them warehouse more of our products in Asia.
"The retail home furnishings sales environment continues to be very difficult. Business in our Florida markets remains challenging along with difficult comparative results in our gulf coast stores which were strong for most of 2006 following Hurricane Katrina. Our February delivered sales month- to-date are down approximately 12% in total from last year. We are evaluating our costs in a number of areas and reviewing our distribution processes for adjustment to the current business conditions on a regional basis.
"We are committed to our new integrated and enhanced marketing program which is focused on building our Havertys brand. The initial costs and effort from 2006 will carry over into 2007 as the campaign is fully implemented.
"Our store growth plans for 2007 are focused on strengthening our position in our current regions served by our existing distribution infrastructure. We are investing significant capital and resources towards developing a cross- channel website with e-commerce capability. We know our customers and believe that we need to provide them with additional tools to enhance their Havertys shopping experience and earn more of their business," Smith concluded.
Haverty Furniture Companies Inc, USA
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