Form 10-Q
Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 10-Q

 

 

Quarterly Report Pursuant to Section 13 or 15 (d)

of the Securities Exchange Act of 1934

For the quarterly period ended January 30, 2016

Commission File number 000-06506

 

 

NOBILITY HOMES, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Florida   59-1166102

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

3741 S.W. 7th Street

Ocala, Florida

  34474
(Address of principal executive offices)   (Zip Code)

(352) 732-5157

(Registrant’s telephone number, including area code)

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x;    No  ¨.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x;    No  ¨.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer   ¨    Accelerated filer   ¨
Non-accelerated filer   ¨    Smaller reporting company   x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨;    No  x.

Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date.

 

Title of Class

 

Shares Outstanding on

March 14, 2016

Common Stock   4,023,294

 

 

 


Table of Contents

NOBILITY HOMES, INC.

INDEX

 

         Page
Number
 
PART I.  

Financial Information

  
    Item 1.  

Financial Statements (Unaudited)

  
 

Consolidated Balance Sheets as of January 30, 2016 (Unaudited) and October 31, 2015

     3   
 

Consolidated Statements of Comprehensive Income for the three months ended January 30, 2016 and January  31, 2015 (Unaudited)

     4   
 

Consolidated Statements of Cash Flows for the three months ended January 30, 2016 and January  31, 2015 (Unaudited)

     5   
 

Notes to Consolidated Financial Statements (Unaudited)

     6   
    Item 2.  

Management’s Discussion and Analysis of Financial Condition and Results of Operations

     11   
    Item 4.  

Controls and Procedures

     14   
PART II.  

Other Information

  
    Item 6.  

Exhibits

     15   

Signatures

       16   

 

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NOBILITY HOMES, INC.

Consolidated Balance Sheets

 

     January 30,
2016
    October 31,
2015
 
     (Unaudited)        

Assets

    

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   
  

 

 

   

 

 

 

The accompanying notes are an integral part of these financial statements

 

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Table of Contents

NOBILITY HOMES, INC.

Consolidated Statements of Comprehensive Income

(Unaudited)

 

     Three Months Ended  
     January 30,
2016
    January 31,
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   

The accompanying notes are an integral part of these financial statements

 

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NOBILITY HOMES, INC.

Consolidated Statements of Cash Flows

(Unaudited)

 

     Three Months Ended  
     January 30,
2016
    January 31,
2015
 

Cash flows from operating activities:

    

Net income

   $ 678,401      $ 479,788   

Adjustments to reconcile net income to net cash provided by operating activities:

    

Depreciation

     30,333        23,502   

Deferred income taxes

     352,564        —     

Undistributed earnings in joint venture - Majestic 21

     (33,408     (33,578

Losses from investments in retirement community limited partnerships

     —          5,693   

Inventory impairment

     26,583        —     

Stock-based compensation

     152        1,071   

Decrease (increase) in:

    

Accounts receivable

     637,510        880,594   

Inventories

     (468,619     (88,155

Pre-owned homes

     (57,067     (127,327

Income tax receivable

     (10,000     1,207   

Prepaid expenses and other current assets

     58,340        (387,805

(Decrease) increase in:

    

Accounts payable

     (170,858     (97,180

Accrued compensation

     (80,351     (12,659

Accrued expenses and other current liabilities

     (160,299     117,839   

Customer deposits

     91,169        (71,626
  

 

 

   

 

 

 

Net cash provided by operating activities

     894,450        691,364   
  

 

 

   

 

 

 

Cash flows from investing activities:

    

Purchase of property, plant and equipment

     (750,000     (20,989

Collections on mortgage notes receivable

     —          63   

Increase in cash surrender value of life insurance

     (41,999     (31,500
  

 

 

   

 

 

 

Net cash used in investing activities

     (791,999     (52,426
  

 

 

   

 

 

 

Cash flows from financing activities:

    

Proceeds from exercise of employee stock options

     30,370        15,820   

Purchase of treasury stock

     (132,386     (40,320
  

 

 

   

 

 

 

Net cash used in financing activities

     (102,016     (24,500
  

 

 

   

 

 

 

Increase in cash and cash equivalents

     435        614,438   

Cash and cash equivalents at beginning of year

     16,769,292        14,116,412   
  

 

 

   

 

 

 

Cash and cash equivalents at end of quarter

   $ 16,769,727      $ 14,730,850   
  

 

 

   

 

 

 

Supplemental disclosure of cash flows information:

    

Income taxes paid

   $ 10,000      $ —     
  

 

 

   

 

 

 

The accompanying notes are an integral part of these financial statements

 

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Nobility Homes, Inc.

Notes to Consolidated Financial Statements

(Unaudited)

 

Note 1 Basis of Presentation and Accounting Policies

The accompanying unaudited consolidated financial statements for the three months ended January 30, 2016 have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission for Form 10-Q. Accordingly, they do not include all the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements.

The unaudited financial information included in this report includes all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary to reflect a fair statement of the results for the interim periods. The results of operations for the three months ended January 30, 2016 are not necessarily indicative of the results of the full fiscal year.

The condensed consolidated financial statements included in this report should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended October 31, 2015.

In May 2014, the FASB issued ASU 2014-09 (Revenue from Contracts with Customers (Topic 606)), which requires an entity to recognize revenue from the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance addresses, in particular, contracts with more than one performance obligation, as well as the accounting for some costs to obtain or fulfill a contract with a customer; and provides for additional disclosures with respect to revenues and cash flows arising from contracts with customers. With respect to public entities, this update is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017 and early adoption is not permitted. We believe that our implementation of this guidance will have no material impact on our consolidated financial statements.

 

Note 2 Inventories

New home inventory is carried at the lower of cost or market value. The cost of finished home inventories is determined on the specific identification method is removed from inventories and recorded as a component of cost of sales at the time revenue is recognized. In addition, an allocation of depreciation and amortization is included in cost of goods sold. Under the specific identification method, if finished home inventory can be sold for a profit there is no basis to write down the inventory below the lower of cost or market value.

Pre-owned inventory is valued at the lower of the Company’s cost to acquire the inventory plus refurbishment costs incurred to date to bring the inventory to a more saleable state or market value.

Other inventory costs are determined on a first-in, first-out basis.

 

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A breakdown of the elements of inventory is as follows:

 

     January 30,
2016
     October 31,
2015
 

Raw materials

   $ 782,202       $ 721,751   

Work-in-process

     106,757         113,891   

Finished homes

     5,524,281         5,114,568   

Model home furniture and others

     75,084         69,495   
  

 

 

    

 

 

 

Inventories, net

   $ 6,488,324       $ 6,019,705   
  

 

 

    

 

 

 

Pre-owned homes

   $ 5,515,291       $ 5,516,272   

Inventory impairment reserve

     (1,393,643      (1,425,108
  

 

 

    

 

 

 
     4,121,648         4,091,164   

Less homes expected to sell in 12 months

     (1,223,496      (1,366,974
  

 

 

    

 

 

 

Pre-owned homes, long-term

   $ 2,898,152       $ 2,724,190   
  

 

 

    

 

 

 

 

Note 3 Short-term Investments

The following is a summary of short-term investments (available for sale):

 

     January 30, 2016  
     Amortized
Cost
     Gross
Unrealized
Gains
     Gross
Unrealized
Losses
     Estimated
Fair Value
 

Equity securities in a public company

   $ 167,930       $ 225,009       $ —         $ 392,939   
  

 

 

    

 

 

    

 

 

    

 

 

 

 

     October 31, 2015  
     Amortized
Cost
     Gross
Unrealized
Gains
     Gross
Unrealized
Losses
     Estimated
Fair Value
 

Equity securities in a public company

   $ 167,930       $ 294,648       $ —         $ 462,578   
  

 

 

    

 

 

    

 

 

    

 

 

 

The fair values were estimated based on quoted market prices in active markets at each respective period end.

 

Note 4 Fair Value of Financial Instruments

The carrying amount of cash and cash equivalents, accounts receivables, accounts payable and accrued expenses approximates fair value because of the short maturity of those instruments. Short-term investments (available for sale) are carried at fair value.

FASB ASC No. 820 “Fair Value Measurements” defines fair value as the price that would be received upon the sale of an asset or paid to transfer a liability (i.e. exit price) in an orderly transaction between market participants at the measurement date. ASC No. 820 requires disclosures that categorize assets and liabilities measured at fair value into one of three different levels depending on the assumptions (i.e. inputs) used in the valuation. Financial assets and liabilities are classified in their entirety based on the lowest level of input significant to the fair value measurement. The ASC No. 820 fair value hierarchy is defined as follows:

 

    Level 1 - Valuations are based on unadjusted quoted prices in active markets for identical assets or liabilities.

 

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    Level 2 - Valuations are based on quoted prices for similar assets or liabilities in active markets, or quoted prices in markets that are not active for which significant inputs are observable, either directly or indirectly.

 

    Level 3 - Valuations are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Inputs reflect management’s best estimate of what market participants would use in valuing the asset or liability at the measurement date.

The following tables present the Company’s assets and liabilities measured at fair value on a recurring basis.

 

     January 30, 2016  
     Level 1      Level 2      Level 3  

Equity securities in a public company

   $ 392,939       $ —         $ —     
  

 

 

    

 

 

    

 

 

 

 

     October 31, 2015  
     Level 1      Level 2      Level 3  

Equity securities in a public company

   $ 462,578       $ —         $ —     
  

 

 

    

 

 

    

 

 

 

 

Note 5 Investments in Retirement Community Limited Partnerships

The Company’s investment in retirement community limited partnerships includes a 31.3% interest in Walden Woods South LLC (“Walden Woods”) and a 48.5% interest in CRF III, Ltd. (“Cypress Creek”). The Cypress Creek and Walden Woods investment are each zero at January 30, 2016 and October 31, 2015, respectively.

The following is summarized financial information of Walden Woods and Cypress Creek*:

 

     December 31,
2015
     September 30,
2015
 

Total Assets

   $ 13,545,756       $ 13,273,488   

Total Liabilities

   $ 17,496,904       $ 17,101,517   

Total Equity

   $ (3,951,148    $ (3,828,029

 

* Due to Walden Woods and Cypress Creek having a calendar year-end, the summarized financial information provided is from their most recent quarter prior to the period covered by this report.

 

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Note 6 Warranty Costs

The Company provides for a limited warranty as the manufactured homes are sold. Amounts related to these warranties are as follows:

 

     Three Months Ended  
     January 30,
2016
     January 31,
2015
 

Beginning accrued warranty expense

   $ 100,000       $ 75,000   

Less: reduction for payments

     (143,468      (40,888

Plus: additions to accrual

     143,468         40,888   
  

 

 

    

 

 

 

Ending accrued warranty expense

   $ 100,000       $ 75,000   
  

 

 

    

 

 

 

The Company’s limited warranty covers substantial defects in material or workmanship in specified components of the home including structural elements, plumbing systems, electrical systems, and heating and cooling systems which are supplied by the Company that may occur under normal use and service during a period of twelve (12) months from the date of delivery to the original homeowner, and applies to the original homeowner or any subsequent homeowner to whom this product is transferred during the duration of this twelve (12) month period.

The Company tracks the warranty claims per home. Based on the history of the warranty claims, the Company has determined that a majority of warranty claims usually occur within the first three months after the home is sold. The Company determines its warranty accrual using the last three months of home sales.

 

Note 7 Earnings Per Share

These financial statements include “basic” and “diluted” net income per share information for all periods presented. The basic net income per share is calculated by dividing net income by the weighted-average number of shares outstanding. The diluted net income per share is calculated by dividing net income by the weighted-average number of shares outstanding, adjusted for dilutive common shares.

 

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Note 8 Revenues by Products and Service

Revenues by net sales from manufactured housing, pre-owned homes and insurance agent commissions are as follows:

 

     Three Months Ended  
     January 30,
2016
     January 31,
2015
 

Manufactured housing

   $ 7,215,341       $ 5,196,445   

Pre-owned homes

     107,316         332,886   

Insurance agent commissions

     51,393         47,469   
  

 

 

    

 

 

 

Total net sales

   $ 7,374,050       $ 5,576,800   
  

 

 

    

 

 

 

 

Note 9 Commitments and Contingent Liabilities

Majestic 21 – The Company is a 50% guarantor on a $5 million note payable entered into by Majestic 21, a joint venture in which the Company owns a 50% interest. This guarantee was a requirement of the bank that provided a $5 million loan to Majestic 21. The $5 million guarantee of Majestic 21’s debt is for the life of the note which matures on the earlier of May 31, 2019 or when the principal balance is less than $750,000. The amount of the guarantee declines with the amortization and repayment of the loan. As collateral for the loan, 21st Mortgage Corporation (our joint venture partner) has granted the lender a security interest in a pool of loans encumbering homes sold by Prestige Homes Centers, Inc. If the pool of loans securing this note should decrease in value so that the notes outstanding principal balance is in excess of 80% of the principal balance of the pool of loans, then Majestic 21 would have to pay down the note’s principal balance to an amount that is no more than 80% of the principal balance of the pool of loans. The Company and 21st Mortgage Corporation are obligated jointly to contribute the amount necessary to bring the loan balance back down to 80% of the collateral provided. We do not anticipate any required contributions as the pool of loans securing the note have historically been in excess of 100% of the collateral value. As of January 30, 2016, the outstanding principal balance of the note was $1,199,454 and the amount of collateral held by our joint venture partner for the Majestic 21 note payable was $2,120,119. Based upon management’s analysis, the fair value of the guarantee is not material and as a result, no liability for the guarantee has been recorded in the accompanying balance sheets of the Company.

 

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Results of Operations

Total net sales in the first quarter of 2016 were $7,374,050, up 32% compared to $5,576,800 in the first quarter of 2015. The Company reported net income of $678,401 in the first quarter of 2016, compared to a net income of $479,788 in the first quarter of 2015.

The following table summarizes certain key sales statistics and percent of gross profit.

 

     Three Months Ended  
     January 30,
2016
    January 31,
2015
 

Homes sold through Company owned sales centers:

    

New homes

     57        43   

Pre-owned homes

     2        8   

Homes sold to independent dealers

     73        62   

Total new factory built homes produced

     140        112   

Average new manufactured home price - retail

   $ 70,460      $ 71,250   

Average new manufactured home price - wholesale

   $ 35,898      $ 33,550   

As a percent of net sales:

    

Gross profit from the Company owned retail sales centers

     17     16

Gross profit from the manufacturing facilities - including intercompany sales

     18     14

Sales to two publicly traded REITs and other companies which own multiple retirement communities in our market area accounted for approximately 23% and 22% of our sales for the first quarter of January 30, 2016 and January 31, 2015, respectively. Accounts receivable due from these customers were $1,890,571 at January 30, 2016.

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.

The Company has specialized for 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.

 

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Insurance agent commission revenues in the first quarter of 2016 were $51,393 compared to $47,469 in the first quarter of 2015. The insurance agent commissions resulted from new policies and renewals generated. The Company establishes appropriate reserves for policy cancellations based on numerous factors, including past transaction history with customers, historical experience and other information, which is periodically evaluated and adjusted as deemed necessary. In the opinion of management, no reserve was deemed necessary for policy cancellations at January 30, 2016 and October 31, 2015.

Gross profit as a percentage of net sales was 24% in first quarter of 2016 compared to 21% in the first quarter of 2015 and was $1,756,435 for the first three months of 2016 compared to $1,172,769 for the first three months of 2015. The gross profit is dependent on the sales mix of wholesale and retail homes and number of pre-owned homes sold. The increase in gross profit is primarily due to the increase in new home sales, increase in the wholesale selling price and increase in the average gross profit on each retail home sold.

Selling, general and administrative expenses as a percent of net sales was 11% in first quarter of 2016 compared to 13% in the first quarter of 2015. Selling, general and administrative expenses in first quarter of 2016 were $780,694 compared to $747,949 in the first quarter of 2015. The increase in expenses resulted from the increase in compensation expenses directly related to our increased sales.

Our earnings from Majestic 21 in the first quarter of 2016 were $33,408 compared to $33,578 for the first quarter of 2015. The earnings from Majestic 21 represent the allocation of profit and losses which are owned 50% by 21st Mortgage and 50% by the Company.

We earned interest on cash and cash equivalents in the amount of $12,047 for the first quarter of 2016 compared to $13,120 for the first quarter of 2015. Interest income is dependent on our cash balance and available rates of return.

The Company recorded an income tax expense of $352,564 for the first quarter of 2016 compared to $1,207 for the first quarter of 2015.

We reported net income of $678,401 for the first quarter of 2016 or $0.17 per share, compared to $479,788, or $0.12 per share, for the first quarter of 2015.

Liquidity and Capital Resources

Cash and cash equivalents were $16,769,727 at January 30, 2016 compared to $16,769,292 at October 31, 2015. Short-term investments were $392,939 at January 30, 2016 compared to $462,578 at October 31, 2015. Working capital was $25,640,995 at January 30, 2016 as compared to $25,702,925 at October 31, 2015. In January 2016, the Company purchased the land for one existing retail sales center for $750,000. We own the entire inventory for our Prestige retail sales centers which includes new, pre-owned and repossessed or foreclosed homes and do not incur any third party floor plan financing expenses. The Company has no material commitments for capital expenditures.

We view our liquidity as our total cash and short term investments. We currently have no line of credit facility and we do not believe that such a facility is currently necessary for our operations. We have no debt. We also have approximately $2.9 million of cash surrender value of life insurance which we could access as an additional source of liquidity though we have not currently viewed this to be necessary. As of January 30, 2016, the Company continued to report a strong balance sheet which included total assets of approximately $43 million which was funded primarily by stockholders’ equity of approximately $40 million.

 

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Critical Accounting Policies and Estimates

In Item 7 of our Form 10-K, under the heading “Critical Accounting Policies and Estimates,” we have provided a discussion of the critical accounting policies and estimates that management believes affect its more significant judgments and estimates used in the preparation of our Consolidated Financial Statements. No significant changes have occurred since that time.

Forward-Looking Statements

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, uncertain economic conditions, 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 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.

 

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures. The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a – 15e and 15d – 15e under the Securities Exchange Act of 1934, as amended) (the “Exchange Act”) as of the end of the period covered by this report (the “Evaluation Date”). Based on their evaluation as of the Evaluation Date, our Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures were effective as of January 30, 2016.

Changes in Internal Control over Financial Reporting. We made no changes in our internal control over financial reporting (as defined in Rules 13a-15(f)) and 15d-15(f) under the Exchange Act) identified in connection with the evaluation of our internal controls that occurred during our last fiscal quarter that has materially affected, or which is reasonably likely to materially affect our internal controls over financial reporting.

 

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Part II. OTHER INFORMATION AND SIGNATURES

There were no reportable events for Item 1 through Item 5.

 

Item 6. Exhibits

 

  31. (a)   Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act and Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934
        (b)   Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act and Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934
  32. (a)   Written Statement of Chief Executive Officer Pursuant to 18 U.S.C. §1350
        (b)   Written Statement of Chief Financial Officer Pursuant to 18 U.S.C. §1350
101.   Interactive data filing formatted in XBRL

 

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Signatures

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, thereunto duly authorized.

 

    NOBILITY HOMES, INC.
DATE: March 14, 2016     By:  

/s/ Terry E. Trexler

    Terry E. Trexler, Chairman,
    President and Chief Executive Officer
DATE: March 14, 2016     By:  

/s/ Thomas W. Trexler

    Thomas W. Trexler, Executive Vice President,
    and Chief Financial Officer
DATE: March 14, 2016     By:  

/s/ Lynn J. Cramer, Jr.

    Lynn J. Cramer, Jr., Treasurer
    and Principal Accounting Officer

 

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