54
H O N  I N D U S T R I E S  I n c .  a n d  S U B S I D I A R I E S
Subsequent Acquisition
On January 5, 2004, the Company finalized the acquisition of Paoli Inc., a subsidiary of Klaussner Furniture Industries, Inc. Paoli is a leading 
provider of wood case goods and seating, with well-known brands, broad product offering, and strong independent representative sales and 
dealer networks. Further details of the transaction will be included in the Company’s SEC Quarterly Report on Form 10-Q for the first quarter 
ended April 3, 2004.
Summary of Quarterly Results of Operations (Unaudited)
The following table presents certain unaudited quarterly financial information for each of the past 12 quarters. In the opinion of the Company’s 
management, this information has been prepared on the same basis as the consolidated financial statements appearing elsewhere in this report 
and includes all adjustments (consisting only of normal recurring accruals) necessary to present fairly the financial results set forth herein. 
Results of operations for any previous quarter are not necessarily indicative of results for any future period.
   First Second  Third Fourth
(In thousands, except per share data) Quarter Quarter Quarter Quarter
YEAR-END 2003: 
 Net sales $ 391,971 $ 406,793 $ 500,091 $ 456,873
 Cost of products sold  252,841  260,367  316,412  286,893
 Gross profit  139,130  146,426  183,679  169,980
 Selling and administrative expenses  114,426  112,979  127,472  125,867
 Restructuring-related charges (income)  –  2,265  3,881  2,364
 Operating income  24,704  31,182  52,326  41,749
 Interest income (expense) – net  (265)  (149)  617  767
 Income before income taxes  24,439  31,033  52,943  42,516
 Income taxes   8,554  10,861   18,530   14,881
 Net income  $ 15,885  $ 20,172  $ 34,413  $ 27,635
 Net income per common share – basic $ .27 $ .35 $ .59 $ .47
 Weighted-average common shares outstanding – basic  58,317  58,143  58,043  58,222
 Net income per common share – diluted $ .27 $ .35 $ .59 $ .47
 Weighted-average common shares outstanding – diluted  58,582  58,468  58,448  58,731
 As a Percentage of Net Sales
 Net sales  100.0%  100.0%  100.0%  100.0%
 Gross profit  35.5  36.0  36.7  37.2
 Selling and administrative expenses  29.2  27.8  25.5  27.5
 Restructuring-related charges  –  0.6  0.8  0.5
 Operating income  6.3  7.7  10.5  9.1
 Income taxes  2.2  2.7  3.7  3.3
 Net income  4.1  5.0  6.9  6.0
YEAR-END 2002: 
 Net sales $ 399,139 $ 399,299 $ 446,274 $ 447,910
 Cost of products sold  259,398  256,696  285,996  290,653
 Gross profit  139,741  142,603  160,278  157,257
 Selling and administrative expenses  110,425  111,320  117,274  115,170
 Restructuring-related charges (income)  3,900  (900)  –  –
 Operating income  25,416  32,183  43,004  42,087
 Interest income (expense) – net  (580)  (710)  (577)  (269)
 Income before income taxes  24,836  31,473  42,427  41,818
 Income taxes   8,941  11,330   15,274   13,649
 Net income $ 15,895 $ 20,143 $ 27,153 $ 28,169
 Net income per common share – basic and diluted $ .27 $ .34 $ .46 $ .48
 Weighted-average common shares outstanding – basic  58,777  58,918  59,140  58,546
 As a Percentage of Net Sales
 Net sales  100%  100%  100%  100%
 Gross profit  35.0  35.7  35.9  35.1
 Selling and administrative expenses  27.7  27.9  26.3  25.7
 Restructuring-related charges  1.0  (.2)  –  –
 Operating income  6.4  8.1  9.6  9.4
 Income taxes  2.2  2.8  3.4  3.0
 Net income  4.0  5.0  6.1  6.3