Greetings ladies and gentlemen, and welcome to the Hooker Furniture Quarterly Investor Conference Call reporting it's Operating Results for the Fiscal 2019 Third Quarter First Nine Months. All participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] It is now my pleasure to introduce your host, Paul Huckfeldt, Vice President, Finance and Chief Financial Officer for Hooker Furniture Corporation. Sir, you may begin.

Thank you, Valerie [ph]. Good afternoon and welcome to our quarterly conference call to review our sales and earnings for the fiscal 2019 third quarter, which ended October 28, 2018. We appreciate your attention this afternoon. Paul Toms, our Chairman and CEO, will join me for our prepared remarks. For the question-and-answer portion of the call, we have several of our business unit heads available to take questions including Michael Delgatti, President of Hooker Domestic Upholstery and Emerging Channel; HMI Co-Presidents, Doug Townsend and Lee Boone; Jeremy Hoff, President of our Hooker Branded Segment; and Anne Jacobsen, our Chief Administrative Officer. During our call, we may make forward-looking statements which are subject to risks and uncertainties. A discussion of factors that could cause our actual results to differ materially from management's expectations is contained in our press release and SEC filings announcing our fiscal 2019 third quarter results. Any forward-looking statements speaks only as of today, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after today's call. This morning, we reported consolidated net sales of $171.5 million and net income of $9.3 million, or $0.79 per diluted share for our fiscal 2019 third quarter, which ended on October 28. For the quarter, consolidated net sales increased 8.6% compared to a year ago, with increases in each of our three segments. Diluted earnings per share increased to $0.79 per share compared to $0.61 a share in the prior year quarter. Now, Paul Toms will comment on our second quarter results.

Thank you, Paul, and good afternoon everyone. We're pleased to report increased revenues across all three of our business segments during the quarter. Consolidated sales were up nearly 9% and consolidated net income was up more than 29%. The efforts we are making to focus on winning channels of distribution are benefiting all segments of our business. The Hooker branded segment led the way in our quarterly sales and income gains with both, Hooker Casegoods and Hooker Upholstery reporting solid sales increases and a corresponding increase in profitability. At Home Meridian profitability performance is improving and most of the business units are growing with some growing dramatically. And the all other segment which includes our domestic upholstery operations, NH contract, sales growth of nearly 29% for the quarter was driven mainly by the inclusion of Shenandoah's net sales, and a 10% sales increase at Bradington-Young. Now taking a closer look at each of our segments, I will begin with our Hooker branded segment. During the second quarter of this year you may remember that sales in the Hooker branded segment were essentially flat following four consecutive quarters of year-over-year sales growth. The segment strongly rebounded this quarter with a 9% year-over-year improvement in both the Casegoods and Upholstery divisions. The increases were driven by our focus on winning channels of distribution, strong product lines, and inside positions on our bestsellers. We also had a good all-high point furniture market, we believe the Hooker branded segment is growing at a faster rate than the industry average and that the profitable growth we're enjoying should continue. Hooker Casegoods is fueling momentum with a speed-to-market strategy and which the division preordered to make new collections prior to the fall High Point Furniture Market. These collections have been favorably previewed by major retailers in…

Thanks, Paul. Consolidated average selling price increased 2.9% mostly due to higher average selling prices at Home Meridian and all of it which offset a decline in [indiscernible] in the Hooker branded segment. Most of the change in ASP was the result of product and customer mix. Unit volume increased slightly on a consolidated basis but there were significant changes between segments, again driven by product and customer mix as well as a significant sales increase in the Hooker branded segment. In all other, the inclusion of Shenandoah Furniture this quarter, an increased sales of higher priced Bradington-Young products helped to offset sales decrease at Sam Moore. Consolidated gross profit of almost $36 million was $1.6 million higher than Q3 of fiscal 2018. Gross profit increase in Hooker branded and all other due to increased sales volumes while gross profit declined slightly at Home Meridian due to a greater mix of lower margin sales programs as we'll as hire freight cost and part attributable to increase demand for freight capacity, in anticipation the opposition of tariffs on Chinese products. Gross margin was flat to late year in Hooker branded, and somewhat lower in all other due to the next of customers. However, the additional volume attributable to Shenandoah more than offset the lower margin. Consolidated selling and administrative expenses increased about $660,000 but declined as a percent of sales. Higher selling expenses on higher volume, higher employee benefit costs, and the cost of investments in people and systems drove the increased spending which offset the absence of $700,000 in acquisition related cost last year, but we are able to better leverage fixed costs on the higher sales this quarter. For these reasons, operating income for the fiscal 2019 third quarter was $925,000 higher than the prior year quarter. Operating margin for the quarter remained at 7.2%. For the fiscal 2019 nine months, consolidated operating income increased over $3 million to $33.5 million or 6.9% of net sales, thanks primarily to a $38 million sales increase. Our balance sheet remains strong despite the use of cash and additional long-term debt incurred to acquire the business of Shenandoah Furniture last year, and the unscheduled $10 million debt payment made earlier this year, as well as $3 million additional pending -- pension funding made in September. At the end of the quarter, we had cash and cash equivalents of over $29 million available to provide the required working capital and to service our acquisition related debt. We also have access of $28.5 million on our revolving credit facility and $23 million of cash surrender value of company-owned life insurance which gives us additional financial flexibility. In today's press release, we also announced an increase in our quarterly dividend of $0.15 per share based on continued confidence in our long-term prospects and the strength of our business model. Now, I'd like to turn the call back to Paul Toms for his outlook.

Thanks Paul. As of quarter end on October 28, consolidated orders were up 19%, backlog was up 17%, compared to the prior year quarter. With a higher backlog driven primarily by Home Meridian. Our view on macroeconomic trends is a bit more mixed and uncertain than in recent months due to the current bumpy stock market, a slowdown in the housing sector, and the overhanging concern about the ongoing trade negotiations between the U.S. and China. After a positive meeting between the two countries at the recent G20 summit and now so tentative agreement to put on hold additional tariffs that have been scheduled to take affect January 1. The current 10% rate remains in place for 90 days while negotiations continue. Despite some mix trends in the overall economy based on our incoming order trends, higher backlog of HMI, and overall momentum in our business. We're bullish as we look ahead to the fourth quarter. This ends the formal part of our discussion. And at this time, I'll turn the call back over to our operator Valeria for questions.

Well, we must have done a really good job of anticipating all their questions and answered them at a point. Really have nothing else to add, I appreciate everybody joining us for today's call. We'll look forward to joining you again, and about four months as we release our year-end results in early April. Thank you for joining today's call.

Thank you. Ladies and gentlemen, this does conclude today's conference call. Thank you for participating and have a wonderful day. You may all disconnect.