HOOKER FURNISHINGS Corp 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the fiscal year ended February 1, 2026. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective as of February 1, 2026, the end of the period covered by this annual report, to provide reasonable assurance that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934, as amended, is accumulated and communicated to the Company’s management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure and are effective to provide reasonable assurance that such information is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. Management’s Report on Internal Control over Financial Reporting In accordance with Section 404 of the Sarbanes-Oxley Act and SEC rules thereunder, management has conducted an assessment of our internal control over financial reporting as of February 1, 2026, based on the framework in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Management’s report regarding that assessment is included on page F-2 of this report, with our consolidated financial statements, and is incorporated herein by reference. Report of Registered Public Accounting Firm Our independent registered public accounting firm, KPMG LLP, audited the consolidated financial statements included in this annual report on Form 10-K and has issued an audit report on the effectiveness of our internal control over financial reporting. KPMG’s report is included on page F-3 and F-4 of this report, with our consolidated financial statements, and is incorporated herein by reference. Changes in Internal Control over Financial Reporting There were no other changes in the Company’s internal control over financial reporting that occurred during the Company’s most recent fiscal quarter that has materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. ITEM 9B. OTHER INFORMATION During the fourth quarter of fiscal 2026, no director or officer of the Company adopted, terminated or modified a ‘ Rule 10b5-1 trading arrangement ’ or ‘ non-Rule 10b5-1 trading arrangement ,’ as each term is defined in Item 408(a) of Regulation S-K. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not Applicable. 32 Table of Contents Hooker Furnishings Corporation Part III In accordance with General Instruction G(3) of Form 10-K, most of the information called for by Items 10, 11, 12, 13 and 14 of Part III will be incorporated by reference to the Company’s definitive Proxy Statement for its Annual Meeting of Shareholders scheduled to be held June 9, 2026 (the “2026 Proxy Statement”), as set forth below. ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE Information relating to our directors will be set forth under the caption “Proposal One-Election of Directors” in the 2026 Proxy Statement and is incorporated herein by reference. Information relating to our executive officers is included in Part I of this report under the caption “Information about our Executive Officers” and is incorporated herein by reference. Information relating to compliance with Section 16(a) of the Exchange Act will be set forth under the caption “Delinquent Section 16(a) Reports” in the 2026 Proxy Statement and is incorporated herein by reference. Information relating to the code of ethics that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions will be set forth under the caption “Code of Business Conduct and Ethics” in the 2026 Proxy Statement and is incorporated herein by reference. Information relating to insider trading policy that applies to our directors, principal executive officers and employees will be set forth under the caption “Insider Trading Policy” in the 2026 Proxy Statement and is incorporated herein by reference. Information relating to material changes, if any, in the procedures by which shareholders may recommend nominees for our Board of Directors will be set forth under the caption “Procedures for Shareholder Recommendations of Director Nominees” in the 2026 Proxy Statement and is incorporated herein by reference. Information relating to the Audit Committee of our Board of Directors, including the composition of the Audit Committee and the Board’s determinations concerning whether certain members of the Audit Committee are “financial experts” as that term is defined under Item 407(d)(5) of Regulation S-K will be set forth under the captions “Corporate Governance” and “Audit Committee” in the 2026 Proxy Statement and is incorporated herein by reference. ITEM 11. EXECUTIVE COMPENSATION Information relating to this item will be set forth under the captions “Report of the Compensation Committee,” “Compensation Discussion and Analysis (CD&A) Executive Compensation” including the executive compensation tables and disclosures following the CD&A and “Director Compensation” in the 2026 Proxy Statement and is incorporated herein by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS Information relating to this item will be set forth under the captions “Equity Compensation Plan Information” and “Security Ownership of Certain Beneficial Owners and Management” in the 2026 Proxy Statement and is incorporated herein by reference. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE Information relating to this item will be set forth in the last two paragraphs under the caption “Audit Committee” and the caption “Corporate Governance” in the 2026 Proxy Statement and is incorporated herein by reference. ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES Information relating to this item will be set forth under the caption “Proposal Three - Ratification of Selection of Independent Registered Public Accounting Firm” in the 2026 Proxy Statement and is incorporated herein by reference. 33 Table of Contents Hooker Furnishings Corporation Part IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES (a) Documents filed as part of this report on Form 10-K: (1) The following reports and financial statements are included in this report on Form 10-K: Management’s Report on Internal Control Over Financial Reporting Reports of Independent Registered Public Accounting Firm Consolidated Balance Sheets as of February 1, 2026 and February 2, 2025 Consolidated Statements of Operations for the fifty-two-week period ended February 1, 2026, the fifty-three-week period ended February 2, 2025 and the fifty-two-week period ended January 28, 2024 Consolidated Statements of Comprehensive (Loss) / Income for the fifty-two-week period ended February 1, 2026, the fifty-three-week period ended February 2, 2025 and the fifty-two-week period ended January 28, 2024 Consolidated Statements of Cash Flows for the fifty-two-week period ended February 1, 2026, the fifty-three-week period ended February 2, 2025 and the fifty-two-week period ended January 28, 2024 Consolidated Statements of Shareholders’ Equity for the fifty-two-week period ended February 1, 2026, the fifty-three-week period ended February 2, 2025 and the fifty-two-week period ended January 28, 2024 Notes to Consolidated Financial Statements (2) Financial Statement Schedules: Financial Statement Schedules have been omitted because the information required has been separately disclosed in the consolidated financial statements or related notes. (b) Exhibits: 3.1 Amended and Restated Articles of Incorporation of the Company, as amended September 16, 2021 (incorporated by reference to Exhibit 3.1 of the Company’s Form 10-Q (SEC File No. 000-25349) for the quarter ended October 31, 2021) 3.2 Amended and Restated Bylaws of the Company as amended September 5, 2023 (incorporated by reference to Exhibit 3.2 of the Company’s Form 10-Q (SEC File No. 000-25349) filed on September 8, 2023) 4.1 Amended and Restated Articles of Incorporation of the Company (See Exhibit 3.1) 4.2 Amended and Restated Bylaws of the Company (See Exhibit 3.2) 4.3 Description of the Company’s Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (incorporated by reference to Exhibit 4.3 of the Company’s Annual Report on Form 10-K (SEC File No. 000-25349) for the year ended February 2, 2020). Pursuant to Regulation S-K, Item 601(b)(4)(iii), instruments, if any, evidencing long-term debt not exceeding 10% of the Company’s total assets have been omitted and will be furnished to the Securities and Exchange Commission upon request. 10.1(b) Form of Outside Director Restricted Stock Agreement (incorporated by reference to Exhibit 99.1 of the Company’s Current Report on Form 8-K (SEC File No. 000-25349) filed on January 17, 2006)* 10.1(c) 2024 Amendment and Restatement of the Hooker Furnishings Corporation Stock Incentive Plan (incorporated by reference to Appendix A of the Company’s Definitive Proxy Statement dated May 3, 2024 (SEC File No. 000-25349))* 10.1(d) 2010 Amended and Restated Hooker Furniture Corporation Supplemental Retirement Income Plan, dated as of June 8, 2010 (incorporated by reference to Exhibit 10.1 of the Company’s Form 10-Q (SEC File No. 000-25349) for the quarter ended October 31, 2010)* 10.1(e) Form of Performance Stock Units Grant Agreement (incorporated by reference to Exhibit 10.1 of the Company’s Quarterly Report on Form 10-Q (SEC File No. 000-25349) for the quarter ended July 28, 2024)* 10.1(f) Form of RSU Time-based Vesting Grant Agreement (incorporated by reference to Exhibit 10.2 of the Company’s Quarterly Report on Form 10-Q (SEC File No. 000-25349) for the quarter ended July 28, 2024)* 10.1(j) First Amendment to the 2010 Amended and Restated Hooker Furniture Corporation Supplemental Retirement Income Plan (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K (SEC File No. 000-25349) filed with the SEC on November 15, 2019)* 10.1(k) Employment Agreement, dated February 20, 2025, by and between Hooker Furnishings Corporation and Jeremy R. Hoff (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (SEC File No. 000-25349) filed on February 26, 2025).* 34 Table of Contents 10.1(l) Employment Agreement, dated February 20, 2025, by and between Hooker Furnishings Corporation and C. Earl Armstrong, III (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K (SEC File No. 000-25349) filed on February 26, 2025).* 10.1(m) Employment Agreement, dated February 20, 2025, by and between Hooker Furnishings Corporation and Anne J. Smith (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K (SEC File No. 000-25349) filed on February 26, 2025).* 10.2 Asset Purchase Agreement dated December 1, 2025 by and between the Company and Magnussen Home Furnishings, Inc. (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (SEC File No. 000-25349) filed on December 3, 2025). 10.3 Amended and Restated Loan and Security Agreement, dated as of December 5, 2024, between Bank of America, N.A. and Hooker Furnishings Corporation, Bradington-Young, LLC, Sam Moore Furniture LLC and Home Meridian Group, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (SEC File No. 000-25349) filed on December 6, 2024). 10.4 Cooperation Agreement dated January 1, 2026 by and among Hooker Furnishings Corporation, Global Value Investment Corporation and each of the parties listed on Schedule A thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (SEC File No. 000-25349) filed on January 2, 2026). 10.5 First Amendment to Cooperation Agreement dated February 17, 2026 by and among Hooker Furnishings Corporation, Global Value Investment Corporation and each of the parties listed on Schedule A thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K (SEC File No. 000-25349) filed on February 17, 2026). 19.1 Hooker Furniture Corporation Insider trading policy filed herewith 21 List of Subsidiaries: Bradington-Young LLC, a North Carolina limited liability company Sam Moore Furniture LLC, a Virginia limited liability company 23 Consent of Independent Registered Public Accounting Firm (filed herewith) 31.1 Rule 13a-14(a) Certification of the Company’s principal executive officer (filed herewith) 31.2 Rule 13a-14(a) Certification of the Company’s principal financial officer (filed herewith) 32.1 Rule 13a-14(b) Certification of the Company’s principal executive officer and principal financial officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith) 97 Hooker Furnishings Corporation Compensation Recoupment Policy, as amended and restated on September 5, 2023 (incorporated by reference to Exhibit 97 to the Company’s Annual Report on Form 10-K (SEC File No. 000-25349) filed on April 12, 2024) 101 The following financial statements from the Company’s Annual Report on Form 10-K for the fiscal year ended February 1, 2026, formatted in Interactive Extensible Business Reporting Language (“IXBRL”): (i) consolidated balance sheets, (ii) consolidated statements of operations, (iii) consolidated statements of comprehensive (loss)/income, (iv) consolidated statements of cash flows, (v) consolidated statements of shareholders’ equity and (vi) the notes to the consolidated financial statements, tagged as blocks of text (filed herewith) 104 Cover page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101) * Management contract or compensatory plan ITEM 16. FORM 10-K SUMMARY None. 35 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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. HOOKER FURNISHINGS CORPORATION April 17, 2026 /s/ Jeremy R. Hoff Jeremy R. Hoff Chief Executive Officer and Director (Principal Executive Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Jeremy R. Hoff Chief Executive Officer and April 17, 2026 Jeremy R. Hoff Director (Principal Executive Officer) /s/ C. Earl Armstrong III Senior Vice President - Finance April 17, 2026 C. Earl Armstrong III and Chief Financial Officer (Principal Financial and Accounting Officer) /s/ W. Christopher Beeler, Jr. Director (Board Chair) April 17, 2026 W. Christopher Beeler, Jr. /s/ Maria C. Duey Director April 17, 2026 Maria C. Duey /s/ Paulette Garafalo Director April 17, 2026 Paulette Garafalo /s/ Christopher L. Henson Director April 17, 2026 Christopher L. Henson /s/ Paul A. Huckfeldt Director April 17, 2026 Paul A. Huckfeldt /s/ Tonya H. Jackson Director April 17, 2026 Tonya H. Jackson /s/ Ellen C. Taaffe Director April 17, 2026 Ellen C. Taaffe 36 Table of Contents HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Management’s Report on Internal Control Over Financial Reporting F-2 Reports of Independent Registered Public Accounting Firm (PCAOB ID: 185 ) F-3 Consolidated Balance Sheets as of February 1, 2026 and February 2, 2025 F-5 Consolidated Statements of Operations for the fifty-two-week period ended February 1, 2026, the fifty-three-week period ended February 2, 2025 and the fifty-two-week period ended January 28, 2024 F-6 Consolidated Statements of Comprehensive (Loss)/Income the fifty-two-week period ended February 1, 2026, the fifty-three-week period ended February 2, 2025 and the fifty-two-week period ended January 28, 2024 F-7 Consolidated Statements of Cash Flows for the fifty-two-week period ended February 1, 2026, the fifty-three-week period ended February 2, 2025 and the fifty-two-week period ended January 28, 2024 F-8 Consolidated Statements of Shareholders’ Equity the fifty-two-week period ended February 1, 2026, the fifty-three-week period ended February 2, 2025 and the fifty-two-week period ended January 28, 2024 F-9 Notes to Consolidated Financial Statements F-10 F- 1 Table of Contents MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING To the Shareholders of Hooker Furnishings Corporation Martinsville, Virginia Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Securities Exchange Act Rule 13a-15(f). Under the supervision and with the participation of management, including the principal executive officer and principal financial officer, the Company conducted an evaluation of the effectiveness of its internal control over financial reporting based on the framework in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on the Company’s evaluation under that framework, management concluded that the Company’s internal control over financial reporting was effective as of February 1, 2026. The effectiveness of the Company’s internal control over financial reporting as of February 1, 2026 has been audited by KPMG LLP, the Company’s independent registered public accounting firm, as stated in their report which is included herein. Jeremy R. Hoff Chief Executive Officer and Director (Principal Executive Officer) April 17, 2026 C. Earl Armstrong III Senior Vice President – Finance and Chief Financial Officer (Principal Financial and Accounting Officer) April 17, 2026 F- 2 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors Hooker Furnishings Corporation: Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Hooker Furnishings Corporation and subsidiaries (the Company) as of February 1, 2026 and February 2, 2025, the related consolidated statements of operations, comprehensive (loss)/income, cash flows, and shareholders’ equity for each of the years in the three-year period ended February 1, 2026, and the related notes (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of February 1, 2026 and February 2, 2025, and the results of its operations and its cash flows for each of the years in the three-year period ended February 1, 2026, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of February 1, 2026, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated April 17, 2026 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Sufficiency of audit evidence over revenue As discussed in Note 1 to the consolidated financial statements, the Company generates revenue primarily through the sale of home furnishings and hospitality furniture products. Revenue is recognized by the Company at the time of shipment to the customer. The Company recorded $320.9 million of net sales for the fiscal year ended February 1, 2026. We identified the evaluation of the sufficiency of audit evidence over revenue as a critical audit matter. Subjective auditor judgment was required due to the highly automated nature of certain processes to record revenue that involved interfacing data across multiple information technology (IT) systems and the overall volume of transactions. Additionally, IT professionals with specialized skills and knowledge were required to evaluate the nature and extent of evidence obtained over revenue. The following are the primary procedures we performed to address this critical audit matter. We applied auditor judgment to determine the nature and extent of procedures to be performed over processing and recording of revenue. We involved IT professionals with specialized skills and knowledge, who assisted in 1) gaining an understanding of the systems used in the Company’s recognition of revenue and 2) evaluating the design and testing the operating effectiveness of certain internal controls over the revenue process. This included general IT and certain application controls interacting within the Company’s revenue recognition process. For a sample of revenue transactions, we assessed the recorded amount by comparing to underlying documentation, including invoices, cash receipts, bills of lading, and contracts with customers. We evaluated the sufficiency of audit evidence obtained by assessing the results of procedures performed, including the appropriateness of the nature and extent of such evidence. /s/ KPMG LLP We have served as the Company’s auditor since 2003. Charlotte, North Carolina April 17, 2026 F- 3 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors Hooker Furnishings Corporation: Opinion on Internal Control Over Financial Reporting We have audited Hooker Furnishings Corporation and subsidiaries' (the Company) internal control over financial reporting as of February 1, 2026, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of February 1, 2026, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of February 1, 2026 and February 2, 2025, the related consolidated statements of operations, comprehensive (loss)/income, cash flows, and shareholders’ equity for each of the years in the three-year period ended February 1, 2026, and the related notes (collectively, the consolidated financial statements), and our report dated April 17, 2026 expressed an unqualified opinion on those consolidated financial statements. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ KPMG LLP Charlotte, North Carolina April 17, 2026 F- 4 Table of Contents HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands) February 1, February 2, As of 2026 2025 Assets Current assets Cash and cash equivalents $ 1,112 $ 6,295 Trade accounts receivable, net (See notes 4 and 5) 37,786 45,487 Inventories (see note 6) 48,684 66,228 Income tax recoverable 30 521 Prepaid expenses and other current assets 5,283 5,080 Current assets held for sale (See note 3) - 17,513 Total current assets 92,895 141,124 Property, plant and equipment, net (See note 7) 25,207 27,343 Cash surrender value of life insurance policies (See note 10) 30,422 29,238 Deferred taxes (See note 16) 24,941 16,057 Operating leases right-of-use assets (See note 11) 23,015 39,264 Intangible assets, net (See note 9) 12,994 17,999 Goodwill (See note 9) 575 15,036 Non-current assets held for sale (See note 3) - 11,269 Other assets 15,842 16,612 Total non-current assets 132,996 172,818 Total assets $ 225,891 $ 313,942 Liabilities and Shareholders’ Equity Current liabilities Trade accounts payable $ 11,002 $ 16,376 Accrued salaries, wages and benefits 3,730 3,851 Accrued income taxes 42 49 Customer deposits 5,291 5,655 Current portion of operating lease liabilities (See note 11) 5,445 6,311 Other accrued expenses 2,083 2,916 Current liabilities held for sale (See note 3) - 4,816 Total current liabilities 27,593 39,974 Long term debt (See note 12) 3,223 21,717 Deferred compensation (See note 13) 6,365 6,795 Operating lease liabilities (See note 11) 19,468 35,331 Long-term liabilities held for sale (See note 3) - 5,742 Total long-term liabilities 29,056 69,585 Total liabilities 56,649 109,559 Shareholders’ equity Common stock, no par value, 20,000 shares authorized, 10,764 and 10,703 shares issued and outstanding on each date 51,361 50,474 Retained earnings 117,603 153,336 Accumulated other comprehensive income 278 573 Total shareholders’ equity 169,242 204,383 Total liabilities and shareholders’ equity $ 225,891 $ 313,942 See accompanying Notes to Consolidated Financial Statements. F- 5 Table of Contents HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) For the 52 Week Period Ended February 1, 2026, the 53 Week Period Ended February 2, 2025 and the 52 Week Period Ended January 28, 2024 2026 2025 2024 Net sales $ 278,139 $ 317,357 $ 344,645 Cost of sales 204,644 239,221 250,681 Gross profit 73,495 78,136 93,964 Selling and administrative expenses 71,921 83,823 74,731 Goodwill and trade name impairment charges 15,576 1,055 - Intangible asset amortization 2,462 2,763 2,816 Operating (loss) / income ( 16,464 ) ( 9,505 ) 16,417 Other income, net 196 2,711 858 Interest expense, net 765 1,274 1,573 (Loss) / income from continuing operations before income taxes ( 17,033 ) ( 8,068 ) 15,702 Income tax (benefit) / expense ( 4,254 ) ( 1,902 ) 3,356 Net (loss) / income from continuing operations ( 12,779 ) ( 6,166 ) 12,346 Net loss from discontinued operations, net of taxes ( 14,188 ) ( 6,341 ) ( 2,481 ) Net (loss) / income $ ( 26,967 ) $ ( 12,507 ) $ 9,865 Basic: (Loss) / earnings from continuing operations per share $ ( 1.20 ) $ ( 0.59 ) $ 1.15 Loss from discontinued operations per share ( 1.34 ) ( 0.60 ) ( 0.24 ) Basic (loss) / earnings per share $ ( 2.54 ) $ ( 1.19 ) $ 0.91 Diluted: (Loss) / earnings from continuing operations per share $ ( 1.20 ) $ ( 0.59 ) $ 1.15 Loss from discontinued operations per share ( 1.34 ) ( 0.60 ) ( 0.24 ) Diluted (loss) / earnings per share $ ( 2.54 ) $ ( 1.19 ) $ 0.91 Weighted average shares outstanding: Basic 10,606 10,525 10,684 Diluted 10,606 10,525 10,838 Cash dividends declared per share $ 0.805 $ 0.92 $ 0.89 See accompanying Notes to Consolidated Financial Statements. F- 6 Table of Contents HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) / INCOME (In thousands) For the 52 Week Period Ended February 1, 2026, 53 Week Period Ended February 2, 2025 and the 52 Week Period Ended January 28, 2024 2026 2025 2024 Net (Loss) / Income $( 26,967 ) $( 12,507 ) $ 9,865 Other comprehensive income: Actuarial adjustments ( 389 ) ( 212 ) ( 172 ) Income tax effect on adjustments 94 51 41 Adjustments to net periodic benefit cost ( 295 ) ( 161 ) ( 131 ) Total Comprehensive (Loss) / Income $ ( 27,262 ) $ ( 12,668 ) $ 9,734 See accompanying Notes to Consolidated Financial Statements. F- 7 Table of Contents HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) For the 52 Week Period Ended February 1, 2026, the 53 Week Period Ended February 2, 2025 and the 52 Week Period Ended January 28, 2024 2026 2025 2024 Operating Activities: Net (loss) / income $ ( 26,967 ) $ ( 12,507 ) $ 9,865 Less: Loss from discontinued operations, net of taxes ( 14,188 ) ( 6,341 ) ( 2,481 ) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 7,064 7,752 7,663 Deferred income tax expense/(benefit) ( 8,790 ) ( 4,006 ) 2,523 Goodwill and tradename impairment 15,576 1,055 - Non-cash restricted stock and performance awards 887 950 1,706 Provision adjustment for doubtful accounts and sales allowances ( 405 ) 2,672 ( 549 ) Gain on life insurance policies ( 1,335 ) ( 1,213 ) ( 984 ) Loss on disposal of assets 27 - 35 Changes in assets and liabilities: Trade accounts receivable 8,105 ( 11,338 ) 9,971 Inventories 17,544 ( 13,205 ) 33,135 Income tax recoverable 491 2,492 65 Prepaid expenses and other assets 219 ( 486 ) ( 4,876 ) Trade accounts payable ( 5,816 ) 4,766 17,131 Accrued salaries, wages and benefits ( 122 ) ( 3,549 ) ( 1,890 ) Accrued income taxes ( 7 ) 49 - Customer deposits ( 364 ) ( 265 ) ( 2,590 ) Operating lease liabilities ( 479 ) 424 ( 2,086 ) Other accrued expenses ( 696 ) ( 1,138 ) ( 4,261 ) Deferred compensation ( 818 ) ( 830 ) ( 937 ) Net cash (used in) / provided by operating activities $ 18,302 $ ( 22,036 ) $ 66,402 Investing Activities: Proceeds from sale of discontinued operations 5,499 - - Acquisitions - - ( 2,373 ) Purchases of property, plant and equipment ( 3,163 ) ( 3,074 ) ( 5,238 ) Premiums paid on life insurance policies ( 392 ) ( 395 ) ( 406 ) Proceeds received on life insurance policies - 936 1,036 Proceeds from sale of property and equipment 28 3 - Net cash used in investing activities $ 1,972 $ ( 2,530 ) $ ( 6,981 ) Financing Activities: Proceeds from revolving credit facility 104,568 22,085 - Payments for long-term loans ( 123,078 ) ( 22,900 ) ( 1,400 ) Cash dividends paid ( 8,766 ) ( 9,854 ) ( 9,682 ) Debt issuance cost ( 118 ) ( 480 ) - Purchase and retirement of common stock - - ( 11,674 ) Net cash (used in)/provided by financing activities $ ( 27,394 ) $ ( 11,149 ) $ ( 22,756 ) Discontinued Operations: Cash used in operating activities 2,070 ( 980 ) ( 10,931 ) Cash used in investing activities ( 133 ) ( 169 ) ( 1,577 ) Cash provided by / (used in) discontinued operations $ 1,937 $ ( 1,149 ) $ ( 12,508 ) Net (decrease) / increase in cash and cash equivalents ( 5,183 ) ( 36,864 ) 24,157 Cash and cash equivalents at the beginning of year 6,295 43,159 19,002 Cash and cash equivalents at the end of year $ 1,112 $ 6,295 $ 43,159 Supplemental schedule of cash flow information: Interest paid, net $ 691 $ 1,312 $ 1,375 Income taxes (refund) / paid, net ( 445 ) ( 2,328 ) 23 Supplemental schedule of noncash investing activities: Increase / (Decrease) in lease liabilities arising from obtaining right-of-use assets 55 3,201 ( 10,646 ) Increase in property and equipment through accrued purchases 441 167 190 See accompanying Notes to Consolidated Financial Statements. F- 8 Table of Contents HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (In thousands, except per share data) For the 52 Week Period Ended February 1, 2026, the 53 Week Period Ended February 2, 2025 and the 52 Week Period Ended January 28, 2024 Accumulated Other Total Common Stock Retained Comprehensive Shareholders’ Shares Amount Earnings Income Equity Balance at January 29, 2023 11,197 $ 50,770 $ 184,386 $ 865 $ 236,021 Net income $ 9,865 $ 9,865 Actuarial adjustments on defined benefit plan, net of tax of $ 41 $ ( 131 ) ( 131 ) Cash dividends paid and accrued ($ 0.89 per share) ( 9,682 ) ( 9,682 ) Purchase and retirement of common stock ( 620 ) $ ( 2,952 ) ( 8,852 ) ( 11,804 ) Restricted stock grants, net of forfeitures 95 ( 156 ) ( 156 ) Restricted stock compensation cost 1,702 1,702 Performance-based restricted stock units cost 773 773 PSU awards ( 613 ) ( 613 ) Balance at January 28, 2024 10,672 $ 49,524 $ 175,717 $ 734 $ 225,975 Net loss $ ( 12,507 ) $ ( 12,507 ) Actuarial adjustments on defined benefit plan, net of tax of $ 51 $ ( 161 ) ( 161 ) Cash dividends paid and accrued ($ 0.92 per share) ( 9,874 ) ( 9,874 ) Restricted stock grants, net of forfeitures 31 $ ( 404 ) ( 404 ) Restricted stock compensation cost 1,593 1,593 Performance-based restricted stock units cost 453 453 PSU awards ( 692 ) ( 692 ) Balance at February 2, 2025 10,703 $ 50,474 $ 153,336 $ 573 $ 204,383 Net loss $ ( 26,967 ) $ ( 26,967 ) Actuarial adjustments on defined benefit plan, net of tax of $ 94 $ ( 295 ) ( 295 ) Cash dividends paid and accrued ($ 0.81 per share) ( 8,766 ) ( 8,766 ) Restricted stock grants, net of forfeitures 61 $ ( 220 ) ( 220 ) Restricted stock compensation cost 1,257 1,257 Performance-based restricted stock units cost 432 432 PSU awards ( 582 ) ( 582 ) Balance at February 1, 2026 10,764 $ 51,361 $ 117,603 $ 278 $ 169,242 See accompanying Notes to Consolidated Financial Statements. F- 9 Table of Contents HOOKER FURNISHINGS CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollar and share amounts in tables, except per share amounts, in thousands unless otherwise indicated) For the Fifty-Two Weeks Ended February 1, 2026 NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Business Hooker Furnishings Corporation and subsidiaries (the “Company,” “we,” “us” and “our”) design, import, manufacture and market residential household furniture, hospitality and contract furniture, lighting, accessories, and home décor for sale to wholesale and retail merchandisers located principally in North America. Consolidation The consolidated financial statements include the accounts of Hooker Furnishings Corporation and our wholly owned subsidiaries. All material intercompany accounts and transactions have been eliminated in consolidation. All references to the Company refer to the Company and our consolidated subsidiaries, unless specifically referring to segment information. Operating Segments As a public entity, we are required to present disaggregated information by segment using the management approach. The objective of this approach is to allow users of our financial statements to see our business through the eyes of management based upon the way management reviews performance and makes decisions. The management approach requires segment information to be reported based on how management internally evaluates the operating performance of the Company’s business units or segments. The objective of this approach is to meet the basic principles of segment reporting as outlined in ASC 280 Segments (“ASC 280”), which are to allow the users of our financial statements to: ◾ better understand our performance; ◾ better assess our prospects for future net cash flows; and ◾ make more informed judgments about us as a whole. We define our segments as those operations our chief operating decision maker (“CODM”) regularly reviews to analyze performance and allocate resources. We measure the results of our segments using, among other measures, each segment’s net sales, gross profit and operating income, as determined by the information regularly reviewed by the CODM. For financial reporting purposes, we are organized into two operating segments and “All Other”, which includes the remainder of our businesses: ◾ Hooker Branded , consisting of the operations of our imported Hooker Casegoods and Hooker Upholstery businesses; ◾ Domestic Upholstery , which includes the domestic upholstery manufacturing operations of Bradington-Young, HF Custom (formerly Sam Moore), Shenandoah Furniture and Sunset West; and ◾ All Other, consisting of intercompany eliminations and operating segments that are not individually reportable; therefore, we combined them in “All Other” in accordance with ASC 280. Due to a change in the way management internally evaluates operating performance, beginning with the fiscal 2026 first quarter, Hooker Branded and Domestic Upholstery segments’ results now include all the sales of products formerly included in H Contract’s results. Fiscal 2025 results discussed below have been recast to reflect this change. During fiscal 2026, the Company completed the divestiture of Pulaski Furniture (“PFC”) and Samuel Lawrence (“SLF”) casegoods brands, formerly part of the Home Meridian segment. As the PFC and SLF businesses have been classified as discontinued operations, the remaining business does not qualify as a reportable segment, therefore, the Home Meridian segment will be eliminated. The Samuel Lawrence Hospitality product line will be reported within All Other. Cash and Cash Equivalents We consider cash on hand, demand deposits in banks and all highly liquid investments with an original maturity of three months or less to be cash and cash equivalents. F- 10 Table of Contents Trade Accounts Receivable Substantially all of our trade accounts receivable are due from retailers and dealers that sell residential home furnishings or commercial purchasers of our hospitality and senior living products, and consist of a large number of entities with a broad geographic dispersion. We perform credit evaluations of our customers and generally do not require collateral. These trade accounts receivable are reported net of customer allowances and an allowance for doubtful accounts. Reserves for customer allowances comprise the majority of the reduction of our gross trade accounts receivable to the estimated fair value reported on the face of our financial statements. We regularly review and revise customer allowances based on unprocessed claims received and current and historical activity and any agreements made with specific customers. We regularly review and revise accounts receivable for doubtful accounts based upon historical bad debts. If the financial condition of a customer or customers were to deteriorate, resulting in an impairment of their ability to make payments, additional bad debt allowances may be required. In the event a receivable is determined to be potentially uncollectible, we engage collection agencies or law firms to attempt to collect amounts owed to us after all internal collection attempts have ended. Once we have determined the receivable is uncollectible, it is charged against the allowance for doubtful accounts. Fair Value Measurements We utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. We determine fair value based on assumptions that we believe market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following levels: ◾ Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. ◾ Level 2 Inputs: Observable inputs other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. ◾ Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. Fair Value of Financial Instruments The carrying value of certain of our financial instruments (cash and cash equivalents, trade accounts receivable and payable, and accrued liabilities) approximates fair value because of the short-term nature of those instruments. The carrying value of Company-owned life insurance is marked to market each reporting period and any change in fair value is reflected in income for that period. See Note 10 for details. Inventories Inventories, consisting of finished furniture for sale, raw materials, manufacturing supplies and furniture in process, are stated at the lower of cost, or market value, with cost determined using the last-in, first-out (LIFO) method. Under this method, inventory is valued at cost, which is determined by applying a cumulative index to current year inventory dollars. We believe the use of the LIFO method results in a better matching of costs and revenues. We review inventories on hand and record an allowance for slow-moving and obsolete inventory based on historic experience and expected sales. Property, Plant and Equipment Property, plant and equipment are stated at cost, less allowances for depreciation. Provision for depreciation has been computed at annual rates using straight-line or declining balance depreciation methods that will amortize the cost of the depreciable assets over their estimated useful lives. Leases Leases are classified as either finance leases or operating leases based on criteria in Topic 842. All of our current leases are classified as operating leases. We do not currently have finance leases but could in the future. Operating lease right-of-use (“ROU”) assets and liabilities are recognized on the adoption date based on the present value of lease payments over the remaining lease term. As interest rates are not explicitly stated or implicit in any of our leases, we utilized our collateralized incremental borrowing rate at the adoption date of February 4, 2019. The Company generally uses its incremental borrowing rate as the discount rate for the lease. The Company’s incremental borrowing rate for a lease is the rate of interest it would have to pay on a collateralized basis to borrow an amount equal to the lease payments under similar terms. Lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. At the inception of a lease, we allocate the consideration in the contract to each lease and non-lease component based on the component’s relative stand-alone price to determine the lease payments. Lease and non-lease components are accounted for separately. Lease expense for operating leases is recognized on a straight-line basis over the lease term. Included in lease expense are any variable lease payments incurred in the period that were not included in the initial lease liability. Some of our real estate leases contain variable lease payments, including payments based on the percentage increase in the Consumer Price Index for Urban Consumers (“CPI-U”). We used February 2019 CPI-U issued by the US Department of Labor’s Bureau of Labor Statistics to measure lease payments and calculate lease liabilities upon adoption of this standard. Additional payments based on the change in an index or rate, or payments based on a change in our portion of the operating expenses, including real estate taxes and insurance, are recorded when incurred. F- 11 Table of Contents We have a sub-lease at one of our warehouses. In accordance with the provisions of Topic 842, since we have not been relieved as the primary obligor of the warehouse lease, we cannot net the sublease income against our lease payment to calculate the lease liability and ROU asset. Our practice is to straight-line the sub-lease income over the term of the sublease. Our leases have remaining lease terms of less than one year to ten years, some of which include options to extend the leases for up to ten years . We have elected not to recognize ROU assets and lease liabilities that arise from short term leases for any class of underlying asset. Short term leases are leases with lease terms of 12 months or less with either (a) no renewal option or (b) a renewal option which we are not reasonably certain to exercise. Impairment of Long-Lived Assets Long-lived assets, such as property, plant and equipment and definite-lived assets, are evaluated for impairment annually or more frequently when events or changes in circumstances indicate that the carrying amount of the assets or asset groups may not be recoverable through the estimated undiscounted future cash flows from the use of those assets. When any such impairment exists, the related assets are written down to fair value. Long-lived assets subject to disposal by sale are measured at the lower of their carrying amount or fair value less estimated cost to sell, are no longer depreciated, and are reported separately as “assets held for sale” in the consolidated balance sheets. Intangible Assets and Goodwill We own both definite-lived (amortizable) assets and indefinite-lived intangible assets. Our amortizable intangible assets are related to the Shenandoah and Sunset West acquisitions, and includes customer relationships and trademarks. Our indefinite lived assets include goodwill related to the Shenandoah and BOBO acquisitions, as well as the remaining Bradington-Young, Home Meridian and BOBO tradenames. We may acquire additional amortizable assets and/or indefinite lived intangible assets in the future. Our indefinite-lived intangible assets are not amortized but are tested for impairment annually or more frequently if events or circumstances indicate that the asset might be impaired. In accordance with ASC 350, Intangibles – Goodwill and Other, our goodwill, trademarks and trade names are tested for impairment annually as of the first day of our fourth quarter or more frequently if events or changes in circumstances indicate that the asset might be impaired. Circumstances that could indicate a potential impairment include, but are not limited to: ◾ a significant adverse change in the economic or business climate either within the furniture industry or the national or global economy; ◾ significant changes in demand for our products; ◾ loss of key personnel; and ◾ the likelihood that a reporting unit or significant portion of a reporting unit will be sold or otherwise subject to disposal. The assumptions used to determine the fair value of our intangible assets are highly subjective and judgmental and include long-term growth rates, sales volumes, projected revenues, assumed royalty rates and factors used to develop an applied discount rate. If the assumptions that we use in these calculations differ from actual results, we may realize additional impairment on our intangible assets that may have a material-adverse effect on our results of operations and financial condition. Cash Surrender Value of Life Insurance Policies We own seventy life insurance policies on certain of our current and former executives and other key employees. These policies had a carrying value of $ 30.4 million at February 1, 2026 and have a face value of approximately $ 54 million as of that date. Proceeds from the policies are used to fund certain employee benefits and for other general corporate purposes. We account for life insurance as a component of employee benefits cost. Consequently, the cost of the coverage and any resulting gains or losses related to those insurance policies are recorded as a decrease or increase to operating income. Cash payments that increase the cash surrender value of these policies are classified as investing outflows on the Consolidated Statements of Cash Flows, with amounts paid in excess of the increase in cash surrender value included in operating activities. Gains on life insurance policies, which typically occur at the time a policy is redeemed, are included in the reconciliation of net income to net cash used in or provided by operating activities. Revenue Recognition We recognize revenue pursuant to Accounting Standards Codification 606, which requires revenue to be recognized at an amount that reflects the consideration we expect to be entitled to receive in exchange for transferring goods or services to our customers. Our policy is to record revenue when control of the goods transfers to the customer. We have a present right to payment at the time of shipment as customers are invoiced at that time. We believe the customer obtains control of goods at the time of shipment, which is typically when title passes. While the customer may not enjoy immediate physical possession of the products, the customers’ right to re-direct shipment indicates control. In the very limited instances when products are sold under consignment arrangements, we do not recognize revenue until control over such products has transferred to the end consumer. Orders are generally non-cancellable once loaded into a shipping trailer or container. F- 12 Table of Contents The transaction price for each contract is the stated price of the product, reduced by any stated discounts or allowances at that point in time. We do not engage in sales of products that attach a future material right which could result in a separate performance obligation for the purchase of goods in the future at a material discount. The implicit contract with the customer, as reflected in the order acknowledgement and invoice, states the final terms of the sale, including the description, quantity, and price of each product purchased. The transaction price reflects the amount of estimated consideration to which we expect to be entitled. This amount of variable consideration included in the transaction price, and measurement of net sales, is included in net sales only to the extent that it is probable that there will be no significant reversal in a future period. Net sales are comprised of gross revenues from sales of home furnishings and hospitality furniture products and are recorded net of allowances for trade promotions, estimated product returns, rebate advertising programs and other discounts. Physical product returns are very rare due to the high probability of damages to our products in return transit. Other revenues, primarily royalties, are immaterial to our overall results. Payment is typically due within 30-60 days of shipment for customers qualifying for payment terms. Collectability is reasonably assured since we extend credit to customers for whom we have performed credit evaluations and/or from whom we have received a down payment or deposit. Due to the highly-customized nature of our hospitality products, we typically require substantial prepayments on these orders, with the balance due within 30 days of delivery. For our outdoor furnishings, most orders require a 50% deposit upon order and the balance when production is started. Cost of Sales The major components of cost of sales are: ◾ the cost of imported products purchased for resale; ◾ raw materials and supplies used in our domestically manufactured products; ◾ labor and overhead costs associated with our domestically manufactured products; ◾ the cost of our foreign import operations; ◾ charges associated with our inventory reserves; ◾ warehousing and certain shipping and handling costs; and ◾ all other costs required to be classified as cost of sales. Selling and Administrative Expenses The major components of our selling and administrative expenses are: ◾ the cost of our marketing and merchandising efforts, including showroom expenses; ◾ sales and design commissions; ◾ the costs of administrative support functions including, executive management, information technology, human resources and finance; and ◾ all other costs required to be classified as selling and administrative expenses. Advertising We offer advertising programs to qualified dealers under which we may provide signage, catalogs and other marketing support to our dealers and may reimburse some advertising and other costs incurred by our dealers in connection with promoting our products. The cost of these programs does not exceed the fair value of the benefit received. We charge the cost of point-of-purchase materials (including signage, catalogs, and fabric and leather swatches) to selling and administrative expense as incurred. Advertising costs charged to selling and administrative expense for fiscal years 2026, 2025, and 2024 were $ 2.0 million, $ 2.6 million, and $ 2.6 million, respectively. The costs for other advertising allowance programs are charged against net sales. We also have arrangements with some dealers to reimburse them for a portion of their advertising costs, which provides advertising benefits to us. Costs for these arrangements are expensed as incurred and are netted against net sales in our consolidated statements of operations and comprehensive income. Earnings Per Share We use the two-class method to compute basic earnings per share. Under this method we allocate earnings to common shares and participating securities according to their participation rights in dividends declared and undistributed earnings and divide the income available to each class by the weighted average number of common shares for the period in each class. Unvested restricted stock grants made to our non-employee directors and certain employees are considered participating securities because the shares have the right to receive non-forfeitable dividends. Because the participating shares have no obligation to share in net losses, we do not allocate losses to our common shares in this calculation. F- 13 Table of Contents Diluted earnings per share reflect the potential dilutive effect of securities that could share in our earnings. Restricted stock awarded to non-employee directors and certain employees and restricted stock units granted to employees that have not yet vested are considered when computing diluted earnings per share. We use the treasury stock method to determine the dilutive effect of both unvested restricted stock and unvested restricted stock units. Shares of unvested restricted stock and unvested restricted stock units under a stock-based compensation arrangement are considered options for purposes of computing diluted earnings per share and are considered outstanding shares as of the grant date for purposes of computing diluted earnings per share even though their exercise may be contingent upon vesting. Those stock-based awards are included in the diluted earnings per share computation even if the non-employee director may be required to forfeit the stock at some future date, or no shares may ever be issued to the employees. Unvested restricted stock and unvested restricted stock units are not included in outstanding common shares in computing basic earnings per share. Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires us to make estimates and assumptions that affect the reported amounts of: (i) assets and liabilities, including disclosures regarding contingent assets and liabilities at the dates of the financial statements; and (ii) revenue and expenses during the reported periods. Significant items subject to such estimates and assumptions include inventory reserves, useful lives of fixed and intangible assets; allowance for doubtful accounts; deferred tax assets; the valuation of fixed assets and goodwill; our pension and supplemental retirement income plans; and stock-based compensation. These estimates and assumptions are based on our best judgments. We evaluate these estimates and assumptions on an ongoing basis using historic experience and other factors, including the current economic environment, which we believe to be reasonable under the circumstances. We adjust our estimates and assumptions as facts and circumstances dictate. Actual results could differ from our estimates. Recently Adopted Accounting Standards In November 2023, the FASB issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”. The new guidance requires enhanced reportable segment disclosures to include significant segment expenses. The Company adopted this ASU on January 29, 2024. The adoption did not have an impact on our Consolidated Financial Statements. See “Note 18. Segment Information.” In December 2023, the FASB issued Accounting Standards Updates “ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures”. The new guidance requires enhanced effective tax rate reconciliation and income taxes paid disclosures. The Company adopted this ASU on February 3, 2025 on a prospective basis. The adoption of this guidance did not have a material impact on the Company’s consolidated financial statements, but resulted in expanded income tax disclosures. See “Note 16, Income Taxes”. In November 2024, the FASB issued ASU 2024-03, “Disaggregation of income statement expenses”. The new guidance requires new tabular disclosures to disaggregate prescribed natural expenses underlying any income statement caption. ASU 2024-03 is effective for annual periods beginning after December 15, 2026 (our fiscal 2028). We are currently evaluating the impact that the adoption of this new guidance will have on our consolidated financial statements and will add necessary disclosures upon adoption. We reviewed all other newly issued accounting pronouncements and concluded that they are either not applicable to our business or are not expected to have a material effect on our Consolidated Financial Statements as a result of future adoption. NOTE 2 - FISCAL YEAR Our fiscal years end on the Sunday closest to January 31. In some years, generally once every six years, the fourth quarter will be fourteen weeks long and the fiscal year will consist of fifty-three weeks. Our quarterly periods are based on thirteen-week “reporting periods,” which end on Sundays. As a result, each quarterly period generally will be thirteen weeks, or 91 days long, except during a 53-week fiscal year which will have 14 weeks in the fourth quarter. The 2026 fiscal year that ended on February 1, 2026 was a 52-week fiscal year. In the notes to the consolidated financial statements, references to the: ◾ 2026 fiscal year and comparable terminology mean the fiscal year that began February 3, 2025 and ended February 1, 2026; ◾ 2025 fiscal year and comparable terminology mean the fiscal year that began January 29, 2024 and ended February 2, 2025; and ◾ 2024 fiscal year and comparable terminology mean the fiscal year that began January 30, 2023 and ended January 28, 2024. NOTE 3 – DISCONTINUED OPERATIONS During the third quarter of fiscal 2026, we determined that the Home Meridian segment no longer aligned with our long-term strategy to streamline our portfolio and enhance profitability by focusing on brands that generate consistent earnings. As a result, we initiated a process to sell two brands in the segment. On December 1, 2025, we entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with a buyer to sell the Company’s Pulaski Furniture (“PFC”) and Samuel Lawrence (“SLF”) casegoods brands, including specified assets and liabilities associated with those brands. We will retain the Samuel Lawrence brand in connection with the operation of its hospitality business. On December 12, 2025, the Company completed the sale and received cash proceeds of approximately $ 5.5 million, representing the estimated net book value of the assets at closing, less a holdback amount of approximately $ 0.6 million, in accordance with the terms of the purchase agreement. Final transaction pricing, including working capital adjustments, resulted in a difference of approximately $ 0.3 million between the estimated fair value less costs to sell determined at the measurement date and the final net proceeds received. Following the sale, the Home Meridian segment was eliminated, with its remaining Samuel Lawrence Hospitality brand reclassified into the “All Other” category. We believe this transaction represents a single disposal plan that constitutes a strategic shift expected to have a material effect on our operations and financial results. Accordingly, the financial results of the PFC and SLF businesses are reflected in our consolidated financial statements as discontinued operations for all periods presented. F- 14 Table of Contents The following table represents carrying amounts of major classes of assets and liabilities as of the date of the divestiture: Assets: Trade accounts receivable $ 8,324 Less allowances ( 527 ) Inventories 2,228 Other current assets 154 Property, plant and equipment, net 797 Intangible assets 4,796 Operating lease right-of-use assets 5,465 Total assets of discontinued operations $ 21,237 Liabilities: Accounts payable $ 2,810 Accrued expenses and other current liabilities 109 Operating lease liabilities 6,054 Total liabilities of discontinued operations $ 8,973 Net assets disposed $ 12,264 Cash $ 5,500 Receivable from buyer 611 Selling costs $ 735 (Loss) on sale of the discontinued operations $ ( 6,888 ) Assets: February 1, 2026 February 2, 2025 Trade accounts receivable $ - $ 13,575 Less allowances ( 865 ) Inventories 4,528 Other current assets 275 Property, plant and equipment, net 852 Intangible assets 4,106 Operating lease right-of-use assets 6,311 Total assets of discontinued operations $ - $ 28,782 Liabilities: Accounts payable $ - $ 3,625 Accrued expenses and other current liabilities - Operating lease liabilities 6,933 Total liabilities of discontinued operations $ - $ 10,558 The following table represents statements of operations information of carrying amounts of major classes of line items constituting pretax loss of discontinued operations included as part of discontinued operations in fiscal 2026, 2025 and 2024: For the 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, February 2, January 28, 2026 2025 2024 Net sales $ 42,795 $ 80,107 $ 88,581 Cost of sales 41,550 69,295 73,593 Gross profit 1,245 10,812 14,988 Selling and administrative expenses 13,404 16,694 18,209 Trade name impairment charges - 1,776 - Intangible asset amortization 742 922 841 Other income items that are not major ( 1,099 ) ( 222 ) ( 798 ) Pretax loss of discontinued operations related to major classes ( 11,802 ) ( 8,358 ) ( 3,264 ) Loss on sale of the discontinued operations 6,888 - - (Loss) / income from discontinued operations before income taxes ( 18,690 ) ( 8,358 ) ( 3,264 ) Income tax (benefit) / expense ( 4,502 ) ( 2,017 ) ( 783 ) Net income / (loss) from discontinued operations ( 14,188 ) ( 6,341 ) ( 2,481 ) F- 15 Table of Contents The significant components included in our Consolidated Statements of Cash Flows for the discontinued operations are as follows: 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, February 2, January 28, 2026 2025 2024 Operating Activities: Loss from discontinued operations, net of tax $ ( 14,188 ) $ ( 6,341 ) $ ( 2,481 ) Depreciation and amortization 1,120 1,477 1,293 Tradename impairment - 1,776 - Loss on sale of the discontinued operations 6,888 - - Loss / (gain) on disposal of assets 2,422 - - Changes in assets and liabilities: Trade accounts receivable, net 4,914 1,748 1,428 Inventories 2,299 4,265 3,470 Trade accounts payable ( 815 ) ( 1,401 ) ( 16,941 ) Other assets and liabilities ( 570 ) ( 2,504 ) 2,300 Cash provided by / (used in) operating activities from discontinued operations 2,070 ( 980 ) ( 10,931 ) Investing Activities: Purchase of properties and equipment ( 133 ) ( 169 ) ( 1,577 ) Cash used in investing activities from discontinued operations $ ( 133 ) $ ( 169 ) $ ( 1,577 ) NOTE 4 – DOUBTFUL ACCOUNTS AND CUSTOMER ALLOWANCES The activity in the allowance for doubtful accounts was: 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, February 2, January 28, 2026 2025 2024 Balance at beginning of year $ 4,964 $ 1,693 $ 1,658 Non-cash charges to cost and expenses 932 3,167 21 Increase / (decrease) in allowance, net of recoveries ( 709 ) 104 14 Balance at end of year $ 5,187 $ 4,964 $ 1,693 The activity in customer allowances was: 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, February 2, January 28, 2026 2025 2024 Balance at beginning of year $ 317 $ 1,503 $ 2,597 Charges to cost and expenses 5,221 7,197 9,184 Less allowances applied ( 5,856 ) ( 8,096 ) ( 10,541 ) Increase / (decrease) in allowance, net of recoveries 672 ( 287 ) 263 Balance at end of year $ 354 $ 317 $ 1,503 NOTE 5 – ACCOUNTS RECEIVABLE February 1, February 2, 2026 2025 Gross accounts receivable $ 43,327 $ 50,768 Customer allowances ( 354 ) ( 317 ) Allowance for doubtful accounts ( 5,187 ) ( 4,964 ) Trade accounts receivable $ 37,786 $ 45,487 NOTE 6 – INVENTORIES February 1, February 2, 2026 2025 Finished furniture $ 61,178 $ 77,546 Furniture in process 1,497 1,524 Materials and supplies 11,879 11,229 Inventories at FIFO 74,554 90,299 Reduction to LIFO basis ( 25,870 ) ( 24,071 ) Inventories $ 48,684 $ 66,228 At February 1, 2026 and February 2, 2025, we had $ 178,000 and $ 253,000 , respectively, in consigned inventories, which are included in the “Finished furniture” line in the table above. At February 1, 2026 and February 2, 2025, we held $ 11.9 million and $ 5.5 million, respectively, in inventory in Vietnam. F- 16 Table of Contents NOTE 7 – PROPERTY, PLANT AND EQUIPMENT Depreciable Lives February 1, February 2, (In years) 2026 2025 Buildings and land improvements 15 - 30 $ 34,566 $ 34,439 Machinery and equipment 10 11,852 12,165 Computer software and hardware 3 - 10 8,286 8,581 Leasehold improvements Term of lease 7,630 8,882 Furniture and fixtures 3 - 8 3,067 7,075 Other 5 701 701 Total depreciable property at cost 66,102 71,843 Less accumulated depreciation ( 46,060 ) ( 47,532 ) Total depreciable property, net 20,042 24,311 Land 1,077 1,077 Construction-in-progress 4,088 1,955 Property, plant and equipment, net $ 25,207 $ 27,343 Depreciation expenses for fiscal 2026, 2025, and 2024 were $ 2.7 million, $ 3.5 million, and $ 4.0 million, respectively. Capitalized Software Costs Certain costs incurred in connection with developing or obtaining computer software for internal use are capitalized. These costs are amortized over periods of ten years or less. Capitalized software is reported as a component of computer software and hardware above and on the property, plant, and equipment line of our consolidated balance sheets. The activity in capitalized software costs was: 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, February 2, January 28, 2026 2025 2024 Balance beginning of year $ 65 $ 103 $ 1,348 Additions - 7 33 Amortization expense ( 21 ) ( 45 ) ( 389 ) Disposals ( 6 ) - ( 889 ) Balance end of year $ 38 $ 65 $ 103 NOTE 8 – CLOUD COMPUTING HOSTING ARRANGEMENT We have implemented a common Enterprise Resource Planning (ERP) system across all divisions. The ERP system went live at Sunset West in December 2022 and in the legacy Hooker divisions and for consolidated reporting in early September 2023. Based on the provisions of ASU 2018-15, Intangibles — Goodwill and Other — Internal-Use Software, we capitalize implementation costs associated with hosting arrangements that are service contracts. These costs are recorded in “other noncurrent assets” of our consolidated balance sheets. We amortize these costs on a straight-line basis over a 10 -year term. The amortization expenses are recorded as a component of selling and administrative expenses in our consolidated statements of operations. Implementation costs of $ 697,000 and interest expense of $ 186,000 were capitalized in fiscal 2026. Implementation costs of $ 3.0 million and interest expense of $ 239,000 were capitalized in fiscal 2025. Implementation costs of $ 5.1 million and interest expense of $ 273,000 were capitalized in fiscal 2024. Amortization expenses of $ 1.4 million, $ 1.2 million and $ 410,000 were recorded in fiscal 2026, 2025 and 2024, respectively. The capitalized implementation costs at February 1, 2026 and February 2, 2025 were as follows: February 1, 2026 February 2, 2025 Gross carrying amount Accumulated amortization Gross carrying amount Accumulated amortization Implementation Costs $ 17,479 $ ( 2,963 ) $ 16,782 $ ( 1,561 ) Interest Expenses 782 ( 49 ) 596 ( 27 ) F- 17 Table of Contents NOTE 9 – INTANGIBLE ASSETS AND GOODWILL Our goodwill, some trademarks and trade names have indefinite useful lives and, consequently, are not subject to amortization for financial reporting purposes but are tested for impairment annually or more frequently if events or circumstances indicate that the asset might be impaired. Our non-amortizable intangible assets consist of: ◾ Goodwill related to the Shenandoah (acquired 2017) and BOBO (acquired 2023) acquisitions; and ◾ Trademarks and tradenames related to the acquisitions of Bradington-Young (acquired 2002), Home Meridian (acquired 2016), and BOBO Intriguing Objects (acquired 2023). We review goodwill and other intangible assets annually for impairment or more frequently if events or circumstances indicate that it might be impaired. In accordance with ASC 350, Intangibles—Goodwill and Other, we perform our annual goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. Management judgment is a significant factor in the goodwill impairment evaluation process. The computations require management to make estimates and assumptions, the most critical of which are potential future cash flows and the appropriate discount rate. In conjunction with our evaluation of the cash flows generated by the Home Meridian, Bradington-Young and BOBO reporting units, we evaluated the carrying value of trademarks and trade names using the income approach, specifically the relief from royalty method, which values the trademarks and trade names by estimating the savings achieved by ownership of the trademarks and trade name when compared to licensing the trademarks and trade names from an independent owner. The inputs used in the trademarks and trade names analyses are considered Level 3 fair value measurements. During the third quarter of fiscal 2026, adverse economic conditions, including declines in our market value, as well as other changes in market dynamics, triggered an evaluation of our goodwill and intangible assets. We engaged an independent third-party valuation firm to assist in performing this assessment. The valuation procedures were performed with consideration of applicable accounting guidance, including Accounting Standards Codification (“ASC”) Topic 350, Goodwill and Other Intangible Assets and ASC Topic 820, Fair Value Measurement. The determination of the fair value of our Home Meridian and Domestic Upholstery reporting units incorporated three valuation approaches: (i) the Discounted Cash Flow method, which utilized management’s cash flow projections and growth assumptions over an eight-year forecast period; (ii) the Guideline Public Company Method, which considered market data for comparable publicly traded companies; and (iii) the Guideline Transaction Method, which considered market multiples derived from transactions involving comparable businesses under varying risk profiles, geographies, and market conditions. Based on the results of this valuation analysis, we recorded non-cash impairment charges of $ 15.6 million related to continuing operations. These charges consisted of $ 14.5 million related to the impairment of Sunset West goodwill within the Domestic Upholstery segment, $ 558,000 for the trade name in the remaining HMI business classified in All Other, and $ 556,000 for the Bradington-Young trade name in the Domestic Upholstery segment. At February 1, 2026, we concluded the Shenandoah goodwill and BOBO non-amortizable trade name are not impaired. Our amortizable intangible assets are recorded in the Domestic Upholstery segment, consisting of Shenandoah and Sunset West trade names and customer relations. Details of our intangible assets were as follows: February 1, 2026 February 2, 2025 Gross carrying amount Accumulated Amortization Gross carrying amount Accumulated Amortization Intangible assets with indefinite lives: Goodwill Domestic Upholstery - Shenandoah * 490 - 490 - Domestic Upholstery - Sunset West - - 14,462 - All Other - BOBO Intriguing Objects 85 - 84 - Goodwill 575 - 15,036 - Trademarks and Trade names * 2,019 ( 1,114 ) 3,692 - Intangible assets with definite lives: Customer Relations 23,601 ( 12,620 ) 23,601 ( 10,565 ) Trademarks and Trade names 2,334 ( 1,225 ) 2,334 ( 1,062 ) Intangible assets, net 27,954 ( 14,959 ) 29,627 ( 11,627 ) *: The amounts are net of impairment charges of $ 16.4 million related to Shenandoah goodwill, $ 14.5 million related to Sunset West goodwill and $ 5.2 million related to certain trade names not related to PFC and SLF, of which $ 2.6 million were recorded in fiscal 2021 and $ 2.5 million were recorded in fiscal 2025. F- 18 Table of Contents The estimated amortization expense associated with our amortizable intangible assets is expected to be as follows: Fiscal Year Amount 2027 2,178 2028 2,178 2029 2,178 2030 2,178 2031 1,842 2032 and thereafter 1,536 $ 12,090 NOTE 10 – FAIR VALUE MEASUREMENTS Fair value is the price that would be received upon the sale of an asset or paid upon the transfer of a liability (an exit price) in an orderly transaction between market participants on the applicable measurement date. We use a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets for identical assets and liabilities; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions. As of February 1, 2026 and February 2, 2025, Company-owned life insurance was measured at fair value on a recurring basis based on Level 2 inputs. The fair value of the Company-owned life insurance is determined by inputs that are readily available in public markets or can be derived from information available in publicly quoted markets. Additionally, the fair value of the Company-owned life insurance is marked to market each reporting period and any change in fair value is reflected in income for that period. Our assets measured at fair value on a recurring basis at February 1, 2026 and February 2, 2025 were as follows: Fair value at February 1, 2026 Fair value at February 2, 2025 Description Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total (In thousands) Assets measured at fair value Company-owned life insurance $ - $ 30,422 $ - $ 30,422 $ - $ 29,238 $ - $ 29,238 NOTE 11 – LEASES In fiscal 2020, we adopted Accounting Standards Codification Topic 842 Leases. See “Leases” under Note 1 for a discussion of our accounting policies and elections under Topic 842. The analysis below includes office space, warehousing facilities, showroom space, and office equipment related to our continuing operations. Leases and sub-leases associated with the discontinued operations of the PFC and SLF businesses, as well as the former Home Meridian segment, have been excluded for all periods presented. We have a sub-lease at one of our warehouses and we recognized sub-lease income of $ 252,000 in fiscal 2026. The components of lease cost and supplemental cash flow information for leases in fiscal 2026, 2025, and 2024 were: 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, 2026 February 2, 2025 January 28, 2024 Operating lease cost $ 6,587 $ 6,648 $ 6,223 Variable lease cost 325 354 248 Short-term lease cost 193 325 399 Total operating lease cost $ 7,105 $ 7,327 $ 6,870 Operating cash outflows $ 6,956 $ 7,007 $ 6,360 F- 19 Table of Contents The right-of-use assets and lease liabilities recorded on our Consolidated Balance Sheets as of February 1, 2026 and February 2, 2025 were: February 1, 2026 February 2, 2025 Real estate $ 22,328 $ 38,329 Property and equipment 687 935 Total operating leases right-of-use assets $ 23,015 $ 39,264 Current portion of operating lease liabilities $ 5,445 $ 6,311 Long term operating lease liabilities 19,468 35,331 Total operating lease liabilities $ 24,913 $ 41,642 The weighted-average discount rate is 4.91 % at February 1, 2026. The weighted-average remaining lease term is 5.5 years. The following table reconciles the undiscounted future lease payments for operating leases to the operating lease liabilities recorded in the consolidated balance sheet at February 1, 2026. Fiscal Year Undiscounted Future Operating Lease Payments 2027 $ 6,546 2028 4,685 2029 3,915 2030 3,881 2031 3,913 2032 and thereafter 5,833 Total lease payments $ 28,773 Less: impact of discounting ( 3,860 ) Present value of lease payments $ 24,913 As of February 1, 2026, the Company had an additional lease for an administrative office in High Point, North Carolina. This lease is expected to commence in April of calendar 2026 with an initial lease term of seven years and estimated future minimum rental commitments of approximately $ 2.2 million. Since the lease has not yet commenced, the undiscounted amounts are not included in the table above. NOTE 12 – LONG-TERM DEBT On December 5, 2024, the Company and its wholly owned subsidiaries, Bradington-Young, LLC, Sam Moore Furniture LLC and Home Meridian Group, LLC (together with the Company, the “Borrowers”), entered into an Amended and Restated Loan and Security Agreement (the “Amended and Restated Loan Agreement”) with Bank of America, N.A. (“BofA”), as lender. The Amended and Restated Loan Agreement amends, restates and replaces the Second Amended and Restated Loan Agreement, dated as of September 29, 2017, between the Borrowers and BofA, as amended (the “Existing Loan Agreement”). The outstanding principal amount of loans and letters of credit issued under the Existing Loan Agreement and used to collateralize certain insurance arrangements and for imported product purchases will remain outstanding as loans and letters of credit under the Amended and Restated Loan Agreement. The Amended and Restated Loan Agreement provides for a revolving credit facility in a committed principal amount of up to $ 70,000,000 (the “Revolving Commitment”), including subline of $ 8,000,000 for letters of credit, and an option to increase the Revolving Commitment by up to $ 30,000,000 upon meeting certain conditions, including agreement by BofA to increase the Revolving Commitment by such amount. Proceeds of loans and letters of credit under the Amended and Restated Loan Agreement are available for general working capital and other corporate purposes of the Borrower. Availability of loans and letters of credit under the Revolving Commitment is capped by a borrowing base formula calculated as of any date as the sum for the Borrowers of (a) the value of their accounts receivable, (b) the value of their inventory, (c) the value of their in-transit inventory and (d) the life insurance cash surrender value of company-owned life insurance policies, in each case subject to eligibility requirements, advance rates, valuation metrics, reductions for write-offs and other dilutive items and reserves (the “Borrowing Base”). The lesser of the Revolving Commitment and the Borrowing Base, in each case net of the principal amount of outstanding loans and the face amount of letters of credit, constitutes “Availability” under the Amended and Restated Credit Agreement. F- 20 Table of Contents Outstanding loans under the Amended and Restated Loan Agreement will bear interest at a rate per annum equal to the then-current Term SOFR Rate for a period of one month plus 0.10% plus a margin of 1.75%. The Term SOFR Rate will be adjusted on a monthly basis. Letters of credit are subject to a letter of credit fee equal to the actual daily amount of undrawn letters of credit multiplied by a per annum rate of 1.75 % and a fronting fee equal to the actual daily amount of undrawn letters of credit multiplied by a per annum rate of 0.125 %. We must also pay a monthly unused commitment fee that is based on the average daily unused amount of Revolving Commitment multiplied by a per annum rate of 0.25 %. All accrued interest and fees are payable in cash monthly in arrears. We may prepay any outstanding principal amounts borrowed under the Amended and Restated Loan Agreement at any time, without penalty provided that any payment is accompanied by all accrued interest owed. Subject to the Borrowers having sufficient borrowing base capacity and customary conditions precedent to borrowing, amounts repaid may be reborrowed. The Revolving Commitment will terminate, and all amounts outstanding thereunder will be due and payable, on December 5, 2029. The obligations under the Amended and Restated Loan Agreement are secured by a first priority security interest in substantially all of the assets of the Borrowers, other than real estate, including all Company-owned life insurance policies, all accounts receivable, all inventory, all intellectual property, all equipment and all other personal property. The Amended and Restated Loan Agreement includes customary representations and warranties and requires the Borrowers to comply with customary affirmative and negative covenants, including, among other things, a financial covenant requiring the maintenance of a ratio of (x) EBITDA net of capital expenditures (to the extent not paid using Borrowed Money) to (y) the sum of debt service and dividends paid, in each case as of the last day of each month for the trailing twelve-month period ending on such day, of at least 1.0 to 1.0, if an event of default has occurred and is continuing or Availability has fallen below 10% of the Revolving Commitment at any time (until such time as both Availability is 10% or greater and no event of default exists, for the 30 consecutive days prior to such month end). The Amended and Restated Loan Agreement also limits the Borrowers’ right to incur other indebtedness, make certain investments and create liens upon our assets, subject to certain exceptions, among other restrictions. The Amended and Restated Loan Agreement does not restrict the Company’s ability to pay cash dividends on, or repurchase, shares of its common stock, subject to (a) no default existing prior to or resulting from such dividend or repurchase, (b) Availability is not less than 15% of the Revolving Commitment for each of the preceding 45 days prior to announcement of such dividend or repurchase and after giving pro forma effect to such dividend or repurchase and (c) if Availability is less than 20% of the Revolving Commitment on any day in such 45-day period, the Borrowers are in compliance with the financial covenant described above after giving effect to such dividend or repurchase. We incurred $ 480,000 in debt issuance costs in fiscal 2025 and an additional $ 118,000 in fiscal 2026 in connection with our term loans. As of February 1, 2026, unamortized loan costs of $ 476,000 were netted against the carrying value of our term loans on our consolidated balance sheets. As of February 1, 2026, we had $ 3.6 million principal amount of outstanding loans and $ 3.6 million face amount of letters of credit. We had $ 62.8 million of Availability based on the current Borrowing Base. There were no additional borrowings outstanding under the Amended and Restated Loan Agreement as of February 1, 2026. NOTE 13 – EMPLOYEE BENEFIT PLANS Employee Savings Plans We sponsor a tax-qualified 401(k) retirement plan covering substantially all employees. This plan assists employees in meeting their savings and retirement planning goals through employee salary deferrals and discretionary employer matching contributions. Our contributions to the plan amounted to $ 1.5 million in fiscal 2026 and $ 1.8 million in fiscal 2025 and 2024. Executive Benefits SRIP and SERP Overview We maintain two “frozen” retirement plans, which are paying benefits and may include active employees among the participants but we do not expect to add participants to these plans in the future. The two plans include: ◾ a supplemental retirement income plan (“SRIP”) for certain former and current executives of Hooker Furnishings Corporation; and ◾ the Pulaski Furniture Corporation Supplemental Executive Retirement Plan (“SERP”) for certain former executives. This is excluded from the disposal group classified as held for sale. SRIP and SERP The SRIP provides monthly payments to participants or their designated beneficiaries based on a participant’s “final average monthly earnings” and “specified percentage” participation level as defined in the plan, subject to a vesting schedule that may vary for each participant. The benefit is payable for a 15-year period following the participant’s termination of employment due to retirement, disability or death . In addition, the monthly retirement benefit for each participant, regardless of age, becomes fully vested and the present value of that benefit is paid to each participant in a lump sum upon a change in control of the Company as defined in the plan. The SRIP is unfunded and all benefits are payable solely from our general assets. The plan liability is based on the aggregate actuarial present value of the vested benefits to which participating employees are currently entitled but based on the employees’ expected dates of separation or retirement. No employees have been added to the plan since 2008 and we do not expect to add additional employees in the future, due to changes in our compensation philosophy, which emphasizes more performance-based compensation measures in total management compensation. F- 21 Table of Contents The SERP provides monthly payments to eight retirees or their designated beneficiaries based on a defined benefit formula as defined in the plan. The benefit is payable for the life of the retiree with the following forms available as a reduced monthly benefit: Ten-year Certain and Life; 50% or 100% Joint and Survivor Annuity. The SERP is unfunded and all benefits are payable solely from our general assets. The plan liability is based on the aggregate actuarial present value of the benefits to which retired employees are currently entitled. No employees have been added to the plan since 2006 and we do not expect to add additional employees in the future. Summarized SRIP and SERP information as of each fiscal year-end (the measurement date) is as follows: SRIP (Supplemental Retirement Income Plan) February 1, February 2, 2026 2025 Change in benefit obligation: Beginning projected benefit obligation $ 6,836 $ 7,371 Service cost 60 58 Interest cost 336 348 Benefits paid ( 978 ) ( 877 ) Actuarial (gain)/ loss 124 ( 64 ) Ending projected benefit obligation (funded status) $ 6,378 $ 6,836 Accumulated benefit obligation $ 6,378 $ 6,677 Discount rate used to value the ending benefit obligations: 5.30 % 5.30 % Amount recognized in the consolidated balance sheets: Current liabilities (Accrued salaries, wages and benefits line) $ 912 $ 962 Non-current liabilities (Deferred compensation line) 5,466 5,874 Total $ 6,378 $ 6,836 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, February 2, January 28, 2026 2025 2024 Net periodic benefit cost Service cost $ 60 $ 58 $ 58 Interest cost 336 348 364 Net (gain)/loss ( 179 ) ( 236 ) ( 279 ) Net periodic benefit cost $ 217 $ 170 $ 143 Other changes recognized in accumulated other comprehensive income Net loss / (gain) arising during period 124 ( 64 ) ( 150 ) Amortizations: Gain (loss) 179 236 279 Total recognized in other comprehensive income 303 172 129 Total recognized in net periodic benefit cost and accumulated other comprehensive income $ 520 $ 342 $ 272 Assumptions used to determine net periodic benefit cost: Discount rate 5.30 % 5.05 % 4.85 % Increase in future compensation levels 4.00 % 4.00 % 4.00 % Estimated Future Benefit Payments: Fiscal 2027 $ 912 Fiscal 2028 821 Fiscal 2029 809 Fiscal 2030 809 Fiscal 2031 809 Fiscal 2032 through fiscal 2036 2,981 For the SRIP, the discount rate used to determine the fiscal 2026 net periodic cost was 5.30%, based on the Mercer yield curve and the plan’s expected benefit payments. At February 1, 2026, combining the Mercer yield curve and the plan’s expected benefit payments resulted in a rate of 5.30 %. This rate was used to value the ending benefit obligations. F- 22 Table of Contents At February 1, 2026, the actuarial loss related to the SRIP amounted to $ 124,000 , net of tax of $ 30,000 . At February 2, 2025, the actuarial gain related to the SRIP amounted to $ 64,000 , net of tax of $ 15,000 . At January 28, 2024, the actuarial gain related to the SRIP amounted to $ 150,000 , net of tax of $ 41,000 . The estimated actuarial gain that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the 2027 fiscal year is $ 192,000 . There is no expected prior service (cost) or credit amortization. SERP (Supplemental Executive Retirement Plan) February 1, February 2, 2026 2025 Change in benefit obligation: Beginning projected benefit obligation $ 1,137 $ 1,224 Service cost - - Interest cost 57 56 Benefits paid ( 158 ) ( 171 ) Actuarial (gain)/loss 76 28 Ending projected benefit obligation (funded status) $ 1,112 $ 1,137 Accumulated benefit obligation $ 1,112 $ 1,137 Discount rate used to value the ending benefit obligations: 4.90 % 5.40 % Amount recognized in the consolidated balance sheets: Current liabilities (Accrued salaries, wages and benefits line) $ 154 $ 155 Non-current liabilities (Deferred compensation line) 958 982 Total $ 1,112 $ 1,137 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, February 2, January 28, 2026 2025 2024 Net periodic benefit cost Service cost $ - $ - $ - Interest cost 57 56 57 Net gain ( 10 ) ( 12 ) ( 15 ) Net periodic benefit cost $ 47 $ 44 $ 42 Other changes recognized in accumulated other comprehensive income Net (gain)/loss arising during period 76 28 29 Amortizations: Gain (Loss) 10 12 15 Total recognized in other comprehensive income 86 40 44 Total recognized in net periodic benefit cost and accumulated other comprehensive income $ 133 $ 84 $ 86 Assumptions used to determine net periodic benefit cost: Discount rate 5.40 % 4.90 % 4.70 % Increase in future compensation levels N/A N/A N/A Estimated Future Benefit Payments: Fiscal 2027 $ 154 Fiscal 2028 146 Fiscal 2029 138 Fiscal 2030 129 Fiscal 2031 119 Fiscal 2032 through fiscal 2036 448 For the SERP, the discount rate assumption used to measure the projected benefit obligations is set by reference to a certain hypothetical AA-rated corporate bond spot-rate yield curve constructed by our actuary, Aon (“Aon”) and the plan’s projected cash flows, rounded to the nearest 10 bps. At February 1, 2026, combining the Aon AA Above Median yield curve and the plan’s expected benefit payments created a rate of 4.9%. This rate was used to value the ending benefit obligations. At February 2, 2025, combining the Aon AA Above Median yield curve and the plan’s expected benefit payments created a rate of 5.40%. This rate was used to determine the fiscal 2026 net periodic cost. At February 1, 2026 and February 2, 2025, the actuarial loss related to the SERP was $ 76,000 and $ 28,000 , respectively. F- 23 Table of Contents NOTE 14 – SHARE-BASED COMPENSATION Our Stock Incentive Plan permits incentive awards of restricted stock, restricted stock units, stock appreciation rights and performance grants to key employees. The Stock Incentive Plan also provides for annual restricted stock awards to non-employee directors. We have issued restricted stock awards to our non-employee directors since January 2006 and certain other management employees since 2014. The Company’s 2024 Amendment and Restatement of the Hooker Furnishings Corporation Stock Incentive Plan (the “2024 Plan”) was approved by shareholders on June 4, 2024 at the annual shareholders meeting. The 2024 plan preserves key elements and historical award practices, while reserving 900,000 new shares of the Company’s common stock. We account for restricted stock awards as “non-vested equity shares” until the awards vest or are forfeited. Restricted stock awards to non-employee directors and certain other management employees vest if the director/employee remains on the board/employed generally over 1 to 3 years. Annual restricted stock awards for non-employee directors do not vest unless the director remains in service to the next annual meeting following annual shareholder meeting. The fair value of each share of restricted stock is the market price of our common shares on the grant date. We have awarded time-based restricted stock units to certain senior executives since 2011. Each restricted stock unit, or “RSU”, entitles the executive to receive one share of the Company’s common stock if he or she remains continuously employed with the Company through the end of a three-year service period . Under the 2024 Plan, each RSU grant vests one-third annually on the anniversary date, provided the executive officer remains continuously employed with the Company through each vesting date. The RSUs may be paid in shares of the Company’s common stock, cash or both, at the discretion of the Compensation Committee. The RSUs are accounted for as “non-vested stock grants.” Similar to the restricted stock grants issued to our non-employee directors, RSU compensation expense is recognized ratably over the applicable service period. However, unlike restricted stock grants, no shares are issued, or other payment made, until the end of the applicable vesting date (commonly referred to as “cliff vesting”). Historically, grantees are not entitled to receive dividends on their RSUs during that time. The fair value of each RSU is the market price of a share of our common stock on the grant date, reduced by the present value of the dividends expected to be paid on a share of our common stock during the applicable service period, discounted at the appropriate risk-free rate. Under the 2024 Plan, dividends declared on unvested RSU awards accumulate in cash and are paid out only upon vesting of the underlying shares. We have issued Performance-based Restricted Stock Units (“PSUs”) to our named executive officers since fiscal 2019. Each PSU entitles the executive officer to receive one share of our common stock based on the achievement of two specified performance conditions if the executive officer remains continuously employed through the end of the three-year performance period. Historically, one target is based on our annual average growth in our EPS over the performance period and the other target is based on EPS growth over the performance period compared to our peers. For the PSU issued under the 2024 Plan, one target is the Company’s absolute EPS compound annual growth rate and the other target is the relative Total Shareholder Return as measured against the Company’s compensation peer group. The payout or settlement of the PSUs will be made in shares of our common stock. Dividends declared on unvested PSU awards accumulate in cash and are paid out only upon vesting of the underlying shares. Share-based compensation expense related to restricted stock, RSU and PSU is included in the selling and administrative expenses on the consolidated statements of operations. The following tables summarize stock awards activity, including the number and weighted-average grant-date fair value, compensation expense recognized, unrecognized compensation expenses, and weighted-average vesting periods of the unvested shares for each grant as of February 1, 2026 (values are in thousands; number of shares and per-share amounts are in whole numbers): Time-based Restricted Stock Time-Based RSU Performance-Based PSU Number of Shares Weighted-Average Grant Date Fair Value per share Number of Shares Weighted-Average Grant Date Fair Value per share Number of Shares Weighted-Average Grant Date Fair Value per share Awards outstanding at January 29, 2023 132,304 19.33 37,765 19.79 63,204 23.20 Granted 101,685 18.43 18,676 16.19 45,552 18.73 Vested ( 46,244 ) 15.71 ( 9,052 ) 12.01 - - Forfeited ( 5,960 ) 21.36 - - ( 16,479 ) 37.20 Awards outstanding at January 28, 2024 181,785 19.68 47,389 19.86 92,277 18.49 Granted 68,413 18.30 39,644 21.77 39,644 17.15 Vested ( 61,182 ) 21.69 ( 21,987 ) 25.16 - - Assumed - - - - ( 8,313 ) ** Forfeited ( 37,599 ) 19.42 ( 9,322 ) 20.47 ( 64,633 ) 18.19 Awards outstanding at February 2, 2025 151,417 $ 18.30 55,724 $ 19.05 58,975 $ 17.94 Granted 95,728 10.51 60,498 13.05 60,499 13.05 Vested ( 68,784 ) 16.74 ( 23,133 ) 18.36 - - Forfeited ( 38,577 ) 15.27 ( 14,180 ) 15.64 ( 43,390 ) 17.41 Awards outstanding at February 1, 2026 139,784 $ 14.57 78,909 $ 15.27 76,084 $ 14.35 F- 24 Table of Contents 52 week ended February 1, 2026 53 week ended February 2, 2025 52 week ended January 28, 2024 Time-based Restricted Stock Grant date fair value of awards vested $ 1,152 $ 1,327 $ 727 Stock based compensation expense 800 1,121 1,398 Time-based RSU Grant date fair value of awards vested 425 553 109 Stock based compensation expense 457 472 304 Performance-based PSU Grant date fair value of awards vested - - - Stock based compensation expense $ ( 150 ) $ ( 239 ) $ 160 As of February 1, 2026 February 2, 2025 January 28, 2024 Time-based Restricted Stock Unrecognized compensation cost $ 723 $ 1,106 $ 1,705 Weighted-average remaining period 1.5 1.6 1.7 Time-based RSU Unrecognized compensation cost $ 666 $ 556 $ 355 Weighted-average remaining period 1.8 2.0 1.7 Performance-based PSU Unrecognized compensation cost $ 630 $ 394 $ 853 Weighted-average remaining period 1.9 1.5 1.7 NOTE 15 – EARNINGS PER SHARE We refer you to the Earnings Per Share disclosure in Note 2-Summary of Significant Accounting Policies, above, for more detailed information concerning the calculation of earnings per share. All stock awards are designed to encourage retention and to provide an incentive for increasing shareholder value. We have issued restricted stock awards to non-employee members of the board of directors since 2006 and to certain non-executive employees since 2014. We have issued RSUs to certain senior executives since fiscal 2012 under the Company’s Stock Incentive Plan. Each RSU entitles an executive to receive one share of the Company’s common stock if the executive remains continuously employed with the Company through the end of a three-year service period. The RSUs may be paid in shares of our common stock, cash or both at the discretion of the Compensation Committee of our board of directors. We have issued PSUs to certain senior executives since fiscal 2019 under the Company’s Stock Incentive Plan. Each PSU entitles the executive officer to receive one share of our common stock based on the achievement of two specified performance conditions if the executive officer remains continuously employed through the end of the three-year performance period. Historically, one target is based on our annual average growth in our EPS over the performance period and the other target is based on EPS growth over the performance period compared to our peers. For the PSUs issued under the Company’s 2024 Plan in fiscal 2025 and afterwards, one target is the Company’s annual EPS growth over the performance period and the other target is the Company’s total shareholder return during the performance period compared to the Company’s peer group. The payout or settlement of the PSUs will be made in shares of our common stock. We expect to continue to grant these types of awards annually in the future. The following table sets forth the number of outstanding restricted stock awards and RSUs and PSUs, net of forfeitures and vested shares, as of the fiscal period-end dates indicated: February 1, February 2, January 28, 2026 2025 2024 Restricted shares 139,784 151,417 181,785 RSUs and PSUs 154,995 114,700 139,666 294,779 266,117 321,451 All restricted shares, RSUs and PSUs awarded that have not yet vested are considered when computing diluted earnings per share. During fiscal 2024, we purchased and retired 620,634 shares of our common stock (at an average price of $ 18.79 per share) under the $ 20 million share repurchase authorization approved by our board of directors in fiscal 2023 and the additional $ 5 million share repurchase authorization approved by our board of directors in the second quarter of fiscal 2024. These repurchases reduced our total outstanding shares and, consequently, reduced the weighted outstanding shares used in our calculation of earnings per share for fiscal 2024 shown below. The share repurchase program was completed during the fiscal 2024 third quarter. F- 25 Table of Contents The following table sets forth the computation of basic and diluted earnings per share: 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, February 2, January 28, 2026 2025 2024 Net (loss) / income from continuing operations $ ( 12,779 ) $ ( 6,166 ) $ 12,346 Less: Unvested participating restricted stock dividends 116 159 153 Net earnings allocated to unvested participating restricted stock - - 156 (Loss) / Earnings from continuing operations available for common shareholders ( 12,895 ) ( 6,325 ) 12,037 (Loss) / Earnings from discontinued operations available for common shareholders ( 14,188 ) ( 6,341 ) ( 2,481 ) (Loss) / Earnings available for common shareholders $ ( 27,083 ) $ ( 12,666 ) $ 9,556 Weighted average shares outstanding for basic earnings per share 10,606 10,525 10,684 Dilutive effect of unvested restricted stock, RSU and PSU awards * * 154 Weighted average shares outstanding for diluted earnings per share 10,606 10,525 10,838 Basic (loss) / earnings from continuing operations per share $ ( 1.20 ) $ ( 0.59 ) $ 1.15 Basic (loss) / earnings from discontinued operations per share ( 1.34 ) ( 0.60 ) ( 0.24 ) Basic (loss) / earnings per share $ ( 2.54 ) $ ( 1.19 ) $ 0.91 Diluted (loss) / earnings from continuing operations per share $ ( 1.20 ) $ ( 0.59 ) $ 1.15 Diluted (loss) / earnings from discontinued operations per share ( 1.34 ) ( 0.60 ) ( 0.24 ) Diluted (loss) / earnings per share $ ( 2.54 ) $ ( 1.19 ) $ 0.91 * Due to net loss in fiscal 2026 and 2025, approximately 128,000 and 186,000 shares, respectively, would have been antidilutive and are therefore excluded from the calculation of earnings per share. NOTE 16 – INCOME TAXES Our provision for income taxes was as follows for the periods indicated: 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, February 2, January 28, 2026 2025 2024 Current expense Federal $ - $ - $ 6 Foreign 15 41 47 State 18 42 - Total current expense 33 83 53 Deferred taxes Federal ( 3,463 ) ( 1,852 ) 2,887 State ( 824 ) ( 133 ) 416 Total deferred taxes ( 4,287 ) ( 1,985 ) 3,303 Income tax (benefit)/expense $ ( 4,254 ) $ ( 1,902 ) $ 3,356 Total tax benefit for fiscal 2026 was $ 8.9 million, of which $ 4.3 million benefit was allocated to continuing operations, $ 4.5 million benefit was allocated to discontinued operations, and $ 94,000 tax benefit was allocated to other comprehensive income. Total tax benefit for fiscal 2025 was $ 4.0 million, of which $ 1.9 million benefit was allocated to continuing operations, $ 2.0 million benefit was allocated to discontinued operations, and $ 51,000 tax benefit was allocated to other comprehensive income. Total tax expense for fiscal 2024 was $ 2.6 million, of which $ 3.4 million expense was allocated to continuing operations, $ .8 million benefit allocated to discontinued operations, and $ 41,000 tax benefit was allocated to other comprehensive income. F- 26 Table of Contents The effective income tax rate differed from the federal statutory tax rate as follows for the periods indicated: 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, February 2, January 28, 2026 2025 2024 Amounts Percentages Amounts Percentages Amounts Percentages Income taxes at statutory rate $ ( 3,575 ) 21.0 % $ ( 1,694 ) 21.0 % $ 3,297 21.0 % State taxes, net of federal benefit ( 637 ) 3.7 % ( 72 ) 0.9 % 328 2.1 % Foreign taxes 16 - 0.1 % 41 - 0.5 % 47 0.3 % Tax credits ( 32 ) 0.2 % ( 51 ) 0.6 % ( 75 ) - 0.5 % Nontaxable or nondeductible items: Officer’s life insurance ( 279 ) 1.6 % ( 255 ) 3.2 % ( 207 ) - 1.3 % Nondeductible meals and entertainment 67 - 0.4 % 111 - 1.4 % 117 0.8 % Stock compensation 150 - 0.9 % 90 - 1.1 % ( 28 ) - 0.2 % Other ( 52 ) 0.3 % ( 79 ) 1.0 % ( 121 ) - 0.8 % Change in valuation allowance 90 - 0.5 % 7 - 0.1 % 8 0.1 % Other ( 1 ) 0.1 % - 0.0 % ( 10 ) - 0.1 % Effective income tax rate ( 4,254 ) 25.0 % ( 1,902 ) 23.6 % 3,356 21.4 % State and local income taxes in California and Virginia comprise the majority of the domestic state and local taxes, net of federal category, for all years. All of the foreign taxes relate to China for all years. In fiscal year 2026, income taxes paid (net of refunds) were ($ 445,000 ), including ($ 491,000 ) for federal, $ 16,000 for foreign (China) and $ 30,000 for state. All of the state tax is for Texas. In fiscal year 2025, income taxes paid (net of refunds) were ($ 2.4 million), including ($ 2.2 million) for federal, $ 41,000 for foreign (China) and ($ 288,000 ) for state. Included in state income taxes are ($ 124,000 ) for California and ($ 110,000 ) for Virginia. In fiscal year 2024, income taxes paid (net of refunds) were $ 23,000 , including none for federal, $ 47,000 for foreign (China) and ($ 25,000 ) for state. Included in state income taxes are ($ 58,000 ) for Georgia, $ 29,000 for Texas and $ 5,000 for Oregon. The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities for the period indicated were: February 1, February 2, 2026 2025 Assets Intangible assets $ 9,079 $ 5,174 Deferred compensation 1,762 1,956 Allowance for bad debts 1,275 1,410 Employee benefits 803 924 Loss and credit carryover 16,022 11,687 Accrued liabilities 206 262 Deferred rent 555 819 Total deferred tax assets 29,702 22,232 Valuation allowance ( 204 ) ( 229 ) 29,498 22,003 Liabilities Inventories 2,628 4,175 Research and development costs 1,774 356 Property, plant and equipment 68 1,235 Other 87 180 Total deferred tax liabilities 4,557 5,946 Net deferred tax assets $ 24,941 $ 16,057 At February 1, 2026 and February 2, 2025 our net deferred tax assets were $ 24.9 and $ 16.1 million, respectively. The decrease in the valuation allowance of $ 25,000 was due to additional foreign tax credit carryforward and a portion of state loss carryforwards. We expect to fully realize the benefit of the net deferred tax assets, after valuation allowance, in future periods when the amounts become deductible. We have federal and state net operating loss carry forwards of $ 58.4 million and $ 41.2 million, respectively, which have various expiration dates beginning in fiscal 2039 through fiscal 2046, with all the federal and $ 20.9 million of state net operating loss carry forwards having an indefinite carry forward period. We have foreign tax credit carry forwards of $ 204,000 which expire beginning in fiscal 2029 through fiscal 2036. We also have charitable contribution carry forwards of $ 5.4 million, which expire in fiscal 2028 through fiscal 2031. Current accounting standards prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The guidance also addresses de-recognition, classification, interest and penalties, accounting in interim periods and disclosure. We do not have unrecognized tax benefits as of February 1, 2026. Tax years ending January 29, 2023 through February 1, 2026 remain subject to examination by federal and state taxing authorities. F- 27 Table of Contents NOTE 17 – SEGMENT INFORMATION As a public entity, we are required to present disaggregated information by segment using the management approach. The objective of this approach is to allow users of our financial statements to see our business through the eyes of management based upon the way management reviews performance and makes decisions. The management approach requires segment information to be reported based on how management internally evaluates the operating performance of the company’s business units or segments. The objective of this approach is to meet the basic principles of segment reporting as outlined in ASC 280 Segments (“ASC 280”), which are to allow the users of our financial statements to: ◾ better understand our performance; ◾ better assess our prospects for future net cash flows; and ◾ make more informed judgments about us as a whole. We define our segments as those operations our chief operating decision maker (“CODM”) regularly reviews to analyze performance and allocate resources. The Company’s CODM is the Chief Executive Officer. The CODM regularly reviews net sales, gross profit, and operating income by segment as the primary measures of segment performance. The CODM reviews net sales as a primary indicator of operational performance, assessing how much revenue is brought in from core business activities, after returns, allowances, and discounts, which reflects demand and execution of each segment’s strategy. Gross profit, which is derived from net sales and cost of sales, is reviewed by the CODM as a diagnostic metric, particularly useful in evaluating margin trends. Operating income is the key profitability metric used to assess performance across segments and make decisions related to resource allocation, including capital expenditures, headcount, and other investment initiatives. Each of these metrics are considered in budgeting, forecasting, and operational planning decisions. For financial reporting purposes, we are organized into two reportable segments and “All Other”, which includes the remainder of our businesses: ◾ Hooker Branded , consisting of the operations of our imported Hooker Casegoods and Hooker Upholstery businesses; ◾ Domestic Upholstery, which includes the domestic upholstery manufacturing operations of Bradington-Young, HF Custom (formerly Sam Moore), Shenandoah Furniture and Sunset West; and ◾ All Other , consisting of intercompany eliminations and operating segments that are not individually reportable. Due to a change in the way management internally evaluates operating performance, beginning with the fiscal 2026 first quarter, Hooker Branded and Domestic Upholstery segments’ results now include all the sales of products formerly included in H Contract’s results. Fiscal 2025 results discussed below have been recast to reflect this change. Subsequent to the third quarter of fiscal 2026, the Company completed the divestiture of the Pulaski Furniture (“PFC”) and Samuel Lawrence (“SLF”) casegoods brands, formerly part of the Home Meridian segment. As the PFC and SLF businesses have been classified as discontinued operations, the remaining business does not qualify as a reportable segment, therefore, we combined them in “All Other” in accordance with ASC 280. The Home Meridian segment has been eliminated. The Samuel Lawrence Hospitality product line, along with the remaining Home Meridian businesses, has been reported within All Other. F- 28 Table of Contents The following table presents segment information for the periods, and as of the dates indicated. Prior-year information has been recast to reflect the changes in segments discussed above. 52 Weeks Ended 53 Weeks Ended 52 Weeks Ended February 1, 2026 February 2, 2025 January 28, 2024 % Net % Net % Net Net Sales Sales Sales Sales Hooker Branded $ 146,978 52.8 % $ 151,298 47.7 % $ 162,524 47.2 % Domestic Upholstery 111,177 40.0 % 114,216 36.0 % 126,827 36.8 % All Other 19,984 7.2 % 51,843 16.3 % 55,294 16.0 % Consolidated $ 278,139 100 % $ 317,357 100 % $ 344,645 100 % Cost of Sales Hooker Branded $ 98,766 67.2 % $ 104,671 69.2 % $ 101,736 62.6 % Domestic Upholstery 90,816 81.7 % 95,927 84.0 % 102,779 81.0 % All Other 15,062 75.4 % 38,623 74.5 % 46,166 83.5 % Consolidated $ 204,644 73.6 % $ 239,221 75.4 % $ 250,681 72.7 % Gross Profit/(Loss) Hooker Branded $ 48,212 32.8 % $ 46,627 30.8 % $ 60,788 37.4 % Domestic Upholstery 20,361 18.3 % 18,289 16.0 % 24,048 19.0 % All Other 4,922 24.6 % 13,220 25.5 % 9,128 16.5 % Consolidated $ 73,495 26.4 % $ 78,136 24.6 % $ 93,964 27.3 % Selling and Administrative Expenses Hooker Branded $ 46,284 31.5 % $ 47,060 31.1 % $ 42,836 26.4 % Domestic Upholstery 20,021 18.0 % 21,287 18.6 % 20,582 16.2 % All Other 5,616 28.1 % 15,476 29.9 % 11,313 20.5 % Consolidated $ 71,921 25.9 % $ 83,823 26.4 % $ 74,731 21.7 % Goodwill and Intangible assets impairment Domestic Upholstery $ 15,018 13.5 % $ - 0.0 % $ - 0.0 % All Other 558 2.8 % 1,055 2.0 % - 0.0 % Consolidated $ 15,576 5.6 % $ 1,055 0.3 % $ - 0.0 % Intangible assets amortization Domestic Upholstery 2,219 2.0 % $ 2,376 2.1 % $ 2,335 1.8 % All Other 243 1.2 % 387 0.7 % 481 0.9 % Consolidated $ 2,462 0.9 % $ 2,763 0.9 % $ 2,816 0.8 % Operating (Loss) / Income Hooker Branded $ 1,928 1.3 % $ ( 433 ) - 0.3 % $ 17,952 11.0 % Domestic Upholstery ( 16,897 ) - 15.2 % ( 5,374 ) - 4.7 % 1,131 0.9 % All Other ( 1,495 ) - 7.5 % ( 3,698 ) - 7.1 % ( 2,666 ) - 4.8 % Consolidated $ ( 16,464 ) - 5.9 % $ ( 9,505 ) - 3.0 % $ 16,417 4.8 % Other Income, net Hooker Branded $ 131 0.1 % $ 1,292 0.9 % $ 872 0.5 % Domestic Upholstery ( 5 ) 0.0 % 770 0.7 % 2 0.0 % All Other 70 0.4 % 649 1.3 % ( 16 ) 0.0 % Consolidated $ 196 0.1 % $ 2,711 0.9 % $ 858 0.2 % Interest expense - Corporate $ 765 0.3 % $ 1,274 0.4 % $ 1,573 0.5 % Income taxes - Corporate $ ( 4,254 ) - 1.5 % $ ( 1,902 ) - 0.6 % $ 3,356 1.0 % Net (loss) / income from continuing operations - Corporate $ ( 12,779 ) - 4.6 % $ ( 6,166 ) - 1.9 % $ 12,346 3.6 % Restructuring Costs Hooker Branded $ 1,301 $ 1,406 $ - Domestic Upholstery 511 639 - All Other 235 2,011 - Consolidated $ 2,047 $ 4,056 $ - Capital Expenditures Hooker Branded 2,464 1,438 4,186 Domestic Upholstery 281 1,515 860 All Other 418 121 192 Consolidated $ 3,163 $ 3,074 $ 5,238 Depreciation & Amortization Hooker Branded 2,223 2,254 2,268 Domestic Upholstery 4,012 4,279 3,972 All Other 829 1,219 1,423 Consolidated $ 7,064 $ 7,752 $ 7,663 F- 29 Table of Contents We recorded $ 2.0 million and $ 4.1 million in restructuring costs in fiscal 2026 and 2025, respectively, primarily related to severance and warehouse consolidation initiatives. Within discontinued operations, we recorded restructuring costs of $ 3.9 million in fiscal 2026, including $ 2.4 million associated with the exit of the Savannah warehouse, which primarily supported the PFC and SLF businesses. These costs included fixed asset write-offs, inventory liquidation and relocation expenses, and severance. In connection with the divestiture, we recorded a $ 6.9 million valuation allowance. In addition, these businesses incurred approximately $ 1.0 million of bad debt expense related to a customer bankruptcy. As of February 1, 2026, we had accrued restructuring charges of approximately $ 298,000 . The balance is expected to be paid during the next 12 months. The restructuring costs were recorded under cost of sales and selling and administrative expenses in the statements of operations. As of February 1, As of February 2, 2026 %Total 2025 %Total Assets Assets Assets Hooker Branded $ 140,732 66.3 % $ 153,373 54.6 % Domestic Upholstery 55,083 25.9 % 58,746 20.9 % All Other 16,507 7.8 % 40,006 14.2 % Assets Held for Sale, net - 0.0 % 28,782 10.2 % Consolidated Assets $ 212,322 100 % $ 280,907 100 % Consolidated Goodwill and Intangibles 13,569 33,035 Total Consolidated Assets $ 225,891 $ 313,942 Sales by product type are as follows: Net Sales (in thousands) Fiscal 2026 2025 2024 Casegoods $ 140,639 51 % $ 159,562 50 % $ 160,046 46 % Upholstery 137,500 49 % 157,795 50 % 184,599 54 % $ 278,139 100 % $ 317,357 100 % $ 344,645 100 % No significant long-lived assets were held outside the United States at either February 1, 2026 or February 2, 2025. International customers accounted for less than 2 % of consolidated invoiced sales in fiscal 2026, 2025, and 2024. We define international sales as sales outside of the United States and Canada. NOTE 18 – COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET ARRANGEMENTS Commitments and Off-Balance Sheet Arrangements We had letters of credit outstanding totaling $ 3.6 million on February 1, 2026. We utilize letters of credit to collateralize certain imported inventory purchases and certain insurance arrangements. In the ordinary course of our business, we may become involved in legal proceedings involving contractual and employment relationships, product liability claims, intellectual property rights and a variety of other matters. We do not believe that any pending legal proceedings will have a material impact on our financial position or results of operations. Our business is subject to a number of significant risks and uncertainties, including our reliance on offshore sourcing, any of which can adversely affect our business, results of operations, financial condition or future prospects. F- 30 Table of Contents NOTE 19 – CONCENTRATIONS OF RISK Imported Products Sourcing We source imported products through multiple vendors, located in seven countries. Because of the large number and diverse nature of the foreign factories from which we can source our imported products, we have some flexibility in the placement of products in any particular factory or country. Factories located in Vietnam are a critical resource for Hooker Furnishings. In fiscal 2026, imported products sourced from Vietnam accounted for 87 % of our import purchases and our top five suppliers accounted for 69 % of our fiscal 2026 import purchases. A disruption in our supply chain from Vietnam could significantly impact our ability to fill customer orders for products manufactured at that factory or in that country. Raw Materials Sourcing for Domestic Upholstery Manufacturing Our five largest domestic upholstery suppliers accounted for 30 % of our raw materials supply purchases for domestic upholstered furniture manufacturing operations in fiscal 2026. One supplier accounted for 8 % of our raw material purchases in fiscal 2026. Should disruptions with these suppliers occur, we believe we could successfully source these products from other suppliers without significant disruption to our operations. Concentration of Sales and Accounts Receivable One customer accounted for approximately 9 % of our consolidated sales in fiscal 2026. Our top five customers accounted for 26 % of our fiscal 2026 consolidated sales. The loss of any one or more of these customers could adversely affect our earnings, financial condition and liquidity. At February 1, 2026, 23 % of our consolidated accounts receivable is concentrated in our top five customers. NOTE 20 - RELATED PARTY TRANSACTIONS We lease the four properties utilized in Shenandoah’s operations. One of our employees has an ownership interest in the entities that own these properties. The leases commenced on September 29, 2017 with an option to renew each for an additional seven years . All four leases include annual rent escalation clauses with respect to minimum lease payments after the initial 84-month term of the lease is completed. In addition to monthly lease payments, we also incur expenses for property taxes, routine repairs and maintenance and other operating expenses. The total amount of the lease expenses and other expenses do not have a material effect on our consolidated financial statements. NOTE 21 - SUBSEQUENT EVENTS Cash Dividend On March 5, 2026 , our Board of Directors declared a quarterly cash dividend of $ 0.115 per share, payable on March 31, 2026 to shareholders of record at March 16, 2026 . F- 31