UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
of the Securities Exchange Act of 1934
Date of Report: May 2, 2005
(Date of earliest event reported: May 2, 2005)
HAVERTY FURNITURE COMPANIES, INC.
(Exact name of registrant as specified in its charter)
Maryland 1-14445 58-0281900
(State or other (Commission (I.R.S.
jurisdiction of File Number) Employer
incorporation or Identification
organization) No.)
780 Johnson Ferry Road,
Suite 800,
Atlanta, Georgia 30342
(Address of principal executive officers) ( Zip Code)
Telephone number, including area code: (404) 443-2900
Check the appropriate box below if the Form 8-K filing is
intended to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions (see General
Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17CFR240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17CFR240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17CFR240.13e-4(c))
ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On May 2, 2005, Haverty Furniture Companies, Inc., a Maryland
corporation (the "Company") issued a press release regarding
matters discussed under Item 4.02 below and incorporated herein
by reference.
ITEM 4.02. NON-RELIANCE ON PREVIOUSLY ISSUED FINANCIAL STATEMENTS
OR A RELATED AUDIT REPORT OR COMPLETED INTERIM REVIEW.
(a)(1) The Company and its audit committee concluded on April 28,
2005 that the Company will restate previously issued historical
financial statements to properly account for leases. The
restatement adjustments will correct the Company's historical
accounting for leases and will have no impact on previously
reported revenue, cash balances, or compliance with any debt
covenants.
As a result of the restatement adjustments, the Company's
previously issued consolidated financial statements contained in
the Annual Report on Form 10-K for the year ended December 31,
2004 should not be relied upon. The restatement adjustments will
impact the Consolidated Balance Sheets and Consolidated
Statements of Income for the years ended December 31, 2004, 2003
and 2002, as discussed below. While the Company's Form 10-Q for
the quarter ended March 31, 2005 will reflect the necessary
adjustments for the quarter then ended, the Company anticipates
filing a Form 12b-25 with the SEC providing for an extension of
time to file its Form 10-Q.
(a)(2) Similar to several other companies within the industry
and retailers in general, the restatement adjustments reflect the
views expressed by the Office of the Chief Accountant of the
Securities and Exchange Commission ("SEC") in its February 7,
2005 letter (the "SEC Letter") to the American Institute of
Certified Public Accountants. The adjustments relate to the
Company's calculation of straight line rent and accounting for
rent holidays.
In conjunction with the Company's fourth quarter 2004 results,
the Company determined adjustments were necessary to recognize
the cumulative impact of correcting its computation of straight
line rent expense. Specifically, the Company revised its
computation of straight line rent to include certain option
periods where failure to exercise such options would result in an
economic penalty. Although this cumulative adjustment was
originally included in the Company's fourth quarter results,
based on the impact of additional lease issues discussed in the
SEC Letter and the additional clarifications made subsequent to
the Company's filing of its Form 10-K for the year ended December
31, 2004 as discussed in the following paragraph, the Company
will restate the periods impacted by this adjustment.
The restatement will also include adjustments for rent holidays,
which is the period of time between the Company taking control
and possession (generally the beginning of construction) of a
leased site and the commencement of lease payments. Previously
the Company began its computation of straight line rent at the
earlier of the commencement of the lease payments or when the
leased site opened for business. However, based on the views
expressed in the SEC Letter, the Company has determined that the
calculation of straight line rent should begin on the date when
the Company takes control and possession of the site. Thus, the
effect of this adjustment will be to increase the period over
which rent is expensed beginning with a period of time prior to
the opening of a leased site.
The restatement adjustments related to lease accounting are
anticipated to decrease net income by $0.1 million and $0.5
million for the years ended December 31, 2004 and 2003,
respectively, and have a negligible impact on the year ended
December 31, 2002. The adjustments are expected to reduce
previously reported diluted earnings per common share by $.01 and
$.02 for the years ended December 31, 2004 and 2003, respectively
and have no impact for 2002. The cumulative effect of these
adjustments for periods prior to 2002 is a reduction in retained
earnings of $1.1 million as of December 31, 2001. The impact of
these adjustments on the Company's Consolidated Balance Sheets as
of December 31, 2004, will be an increase to other liabilities of
approximately $1.7 million.
(a)(3) Pursuant to this Item 4.02(a), the Company's management
and audit committee have discussed the matters disclosed in this
Form 8-K with the Company's independent registered public
accounting firm, Ernst & Young LLP. The discussion of the
Company's revised financial results contained in this Current
Report on Form 8-K has been prepared by management and represents
management's preliminary assessment of the revised results. These
results are subject to change as the Company's independent
registered public accounting firm completes its review.
Item 9.01. Financial Statements, Pro Forma Financial Information
and Exhibits
(c) Exhibits
99.1 Press Release dated May 2, 2005.
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 hereunto duly authorized.
HAVERTY FURNITURE COMPANIES, INC.
May 2, 2005 By: /s/ Jenny Hill Parker
-------------------------------
Jenny Hill Parker
Vice President, Secretary
and Treasurer
EXHIBIT INDEX
99.1 Press Release dated May 2, 2005.