Haverty Furniture Companies, Inc. (NYSE:HVT) Q1 2018 Earnings Conference Call - Final Transcript
May 02, 2018 • 10:00 am ET
Good day everyone and welcome to the Haverty's First Quarter Financial Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Richard Hare. Mr. Hare, please begin.
Thank you, operator. And during this conference call, we'll make forward-looking statements, which are subject to risks and uncertainties. Actual results may differ materially from those made or implied in such statements, which speak only as of the date they are made and which we undertake no obligation to publicly update or revise. Factors that could cause actual results to differ include economic and competitive conditions and other uncertainties detailed in the Company's reports filed with the Securities and Exchange Commission.
Our President, CEO and Chairman, Clarence Smith, will now give you an update on our results and provide commentary about our business.
Good morning. Thank you for joining our first quarter conference call. As we released earlier, Q1 sales decreased 0.5% to $199.4 million with comparable store sales down 1.1%. While our sales decline was disappointing, our earnings for the quarter were in line with our expectations. We had a few store closings which, along with promotional timing shift, help cause a slightly lower gross margin. Our average ticket increased 1.8%.
We continue to see that our H Design program gains in importance and is the key driver of our average sales increases and helping to complete the home for our customers with expanded accessory sales. Our online engagement on havertys.com is growing with improved number of sessions, conversions, and sales increases. Sales for the 2018 second quarter-to-date were down approximately 1.3% with comparable store sales down 1.9%. Our total written sales were up 0.1%, with comparable written sales down 0.3%.
We're in the final phases of rightsizing our store positioning in several of our markets, with the process -- the planned closing of two Texas stores, which overlap with new and expanded nearby locations. For the full year 2018, we will close four stores, most have sister stores where we expect to pick up a significant part of the sales volume. Our recent experience in the last three markets where we repositioned with upgraded stores, but fewer locations have resulted in higher sales and more profitable operations.
Store productivity is a key focus for the Company with a constant emphasis on driving sales per square foot and comp store sales. We're pleased to finalize a lease on a former Hh Gregg location in Chattanooga, Tennessee, a market in the heart of our strongest regions and one that we've been out for over 20 years. We expect to end 2018 with 121 stores and approximately 1.6% less retail square footage.
We have several merchandise initiatives and new promotion planned for the second quarter, which we expect to help us regain positive momentum and grow our share in our markets. We have aggressive promotions for the major holidays and our team is very excited about the new merchandise hitting our stores. Several of