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NH

NOBILITY HOMES INC (NOBH)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue declined to $12.24M and diluted EPS to $0.60, driven by fewer retail homes sold and ongoing supply-chain delays; gross margin held steady versus last year at ~32% .
  • Management reiterated persistent headwinds from higher mortgage rates, supplier backlogs, price increases, and labor shortages, impacting deliveries and earnings; they expect these challenges to continue into FY2025 .
  • Balance sheet remains strong with ~$29.6M in cash, CDs, and short-term investments, no debt, working capital of ~$44.8M, and stockholders’ equity of ~$58.6M .
  • Board declared a one-time cash dividend of $1.25 per share for FY2024, payable April 14, 2025, to holders of record March 31, 2025—an immediate capital return catalyst .
  • Management did not hold an earnings call; direct investor contact information was provided, limiting incremental qualitative color vs. a typical Q&A .

What Went Well and What Went Wrong

What Went Well

  • Gross margin percentage remained consistent at ~32% YoY, supported by pricing actions to offset inflation and higher average gross profit at retail centers .
  • Liquidity and equity were robust: ~$29.6M in cash/CDs/ST investments, ~$44.8M working capital, and ~$58.6M stockholders’ equity, with no debt .
  • Dividend action: Board declared a one-time $1.25/share cash dividend for FY2024, marking continued capital returns to shareholders .

What Went Wrong

  • Net sales fell YoY due to lower retail unit sales and manufacturing output; higher mortgage rates weighed on demand and customers’ purchase timing .
  • Ongoing delays in receiving key materials, backorders, price increases, and labor shortages continued to slow home completion and field setups, negatively impacting sales and earnings .
  • Florida industry shipments declined ~15% (Nov 2024–Jan 2025), reflecting broader macro headwinds in affordability and financing costs .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$13.80 $11.83 $12.24
Gross Profit ($USD Millions)$4.61 $3.91 $3.97
Operating Income ($USD Millions)$2.57 $2.05 $2.29
Net Income ($USD Millions)$2.19 $2.06 $1.98
Diluted EPS ($)$0.67 $0.63 $0.60
Gross Margin (%)33.4% (4.61/13.80) 33.1% (3.91/11.83) 32.5% (3.97/12.24)
Operating Margin (%)18.6% (2.57/13.80) 17.3% (2.05/11.83) 18.7% (2.29/12.24)
Net Margin (%)15.8% (2.19/13.80) 17.4% (2.06/11.83) 16.2% (1.98/12.24)

Estimates vs. Actual (S&P Global)

MetricQ1 2025 ConsensusQ1 2025 Actual
Revenue ($USD Millions)N/A (consensus unavailable via S&P Global)$12.24
Primary EPS ($)N/A (consensus unavailable via S&P Global)$0.60

Note: S&P Global consensus was unavailable for NOBH for Q1 2025; comparisons to estimates cannot be made.

Segment/Revenue Breakdown (Company reports one segment; revenue components)

Revenue ComponentQ1 2024 ($USD)Q1 2025 ($USD)
Homes sold through Company-owned sales centers$12,633,133 $10,648,928
Homes sold to independent dealers and through parks (net)$2,057,582 $1,534,440
Insurance agent commissions$77,283 $58,374
Total Net Sales$14,767,998 $12,241,742

KPIs

KPIQ1 2024Q1 2025
New homes sold through Company-owned sales centers (units)80 67
Pre-owned homes sold through Company-owned sales centers (units)3 0
Homes sold to independent dealers (units)44 31
Total new factory-built homes produced (units)99 87
Average retail new home price ($)$154,513 $154,016
Average wholesale new home price ($)$68,064 $69,095
Gross profit from Company-owned retail sales centers (% of net sales)23% 22%
Gross profit from manufacturing facilities (% of net sales)25% 25%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent Guidance/ActionChange
Revenue/MarginsFY2025None providedManagement expects headwinds to continue (higher rates, supply chain, labor)Maintained qualitative outlook
Dividend per share (one-time)FY2024Not previously specified$1.25 per common share; payable Apr 14, 2025; record date Mar 31, 2025Announced
Conference CallQ1 2025NoneManagement will not hold a conference call; direct contact providedMaintained practice

Earnings Call Themes & Trends

Note: No conference call was held for Q1 2025; themes reflect press releases and 10‑Q MD&A.

TopicPrevious Mentions (Q3 2024)Previous Mentions (Q4 2024)Current Period (Q1 2025)Trend
Interest rates/mortgage affordabilitySales mix shifting to lower-priced homes; demand slowed by higher rates Demand slowed; higher rates impacting sales decisions Higher rates negatively impacting sales; deferred decisions Persistent headwind
Supply chain/materials & laborDelays, back orders, price increases, labor shortages impacting completion and setups Continued delays and shortages; impacting deliveries and earnings Ongoing delays (vinyl siding, PVC), backorders, labor shortages; impacting deliveries and earnings Ongoing constraints
Pricing/inflationMaterial/labor inflation; pricing actions to offset costs Material/labor inflation; may increase wholesale/retail prices Continued inflation in building products; pricing actions helped sustain margins Stable margins via pricing
Macro/industry shipmentsFL shipments down ~3% (Nov 2023–Jul 2024) FL shipments down ~3% (Nov 2023–Oct 2024) FL shipments down ~15% (Nov 2024–Jan 2025) Deteriorated
Vertical integration positioningOnly vertically integrated FL manufactured home company Same emphasis Reiterated positioning Unchanged
Capital returnsNo specific dividend in Q3No specific dividend in Q4One-time $1.25/share dividend announced Positive development

Management Commentary

  • “Net sales decreased in first quarter of 2025 as compared to the prior year because of the decrease in the number of retail homes sold and manufactured…higher interest rates on mortgages are negatively impacting sales…delays in the receipt of certain key production materials…back orders, price increases and labor shortages…Our inability to timely deliver and set up homes to customers has negatively impacted sales and earnings…We expect these challenges will continue into fiscal year 2025.”
  • “Maintaining our strong financial position is vital for future growth and success…Management remains convinced that our specific geographic market is one of the best long-term growth areas in the country.”
  • MD&A reinforced stability in gross margin percentage (~32%) via pricing actions and higher average gross profit at retail centers, despite lower volumes .

Q&A Highlights

  • No conference call was held; management provided direct contact details for investor inquiries (phone and email) .

Estimates Context

  • S&P Global consensus estimates for Q1 2025 revenue and EPS were unavailable for NOBH; therefore, comparison to Wall Street consensus cannot be made. Actual GAAP results—revenue $12.24M and diluted EPS $0.60—serve as the anchor for analysis .
  • Given macro softness (Florida shipments down ~15% over Nov 2024–Jan 2025), sell-side models—where they exist—would likely reflect continued volume pressure in retail and cautious manufacturing throughput assumptions until mortgage rate relief or supply-chain normalization appears .

Key Takeaways for Investors

  • Revenue and EPS contracted YoY, but margins remained resilient due to pricing discipline; operating margin ~18.7% and net margin ~16.2% in Q1 2025 demonstrate solid profitability despite volume headwinds .
  • Strong balance sheet (no debt) and ~$29.6M in liquid assets position NOBH to weather demand volatility and fund operations without external financing; working capital of ~$44.8M provides flexibility .
  • Volume indicators show pressure: retail units sold fell to 67 from 80, independent dealer units to 31 from 44; total factory-built homes produced fell to 87 from 99 .
  • One-time $1.25/share dividend offers near-term capital return; investors should consider sustainability of such distributions against macro uncertainty .
  • Macro/shipments: Florida manufactured housing shipments down ~15% in the relevant period support a cautious near-term demand outlook .
  • With no earnings call, incremental qualitative color is limited; direct engagement with management may be necessary for detail on backlog, lead times, and pricing strategy .
  • Near-term trading: stock may be sensitive to mortgage rate trajectory and any signs of supply-chain normalization; medium-term thesis hinges on execution in a challenging macro plus leverage to Florida’s long-term affordable housing demand .