Share this on

Flexsteel's sales run flat in 3Q

By Furniture Today Staff -- Furniture Today, April 20, 2003

Dubuque, Iowa — Sales were essentially flat and earnings were off 29.5% for upholstery manufacturer Flexsteel Inds. in its third quarter ended March 31, although sales and earnings for the nine months were both up.

Sales for the quarter came in at $73.5 million compared to $73.7 million in the prior year's period. Net income was $1.4 million, or 22 cents per share, compared to $2 million, or 33 cents per share, in the previous year's third period.

Net sales for the nine months were $217.1 million, an increase of 7% over $202.8 million in the prior year's nine months. Net income for the nine months rose 93.9% to $5.7 million, or 89 cents per share, from $2.9 million, or 48 cents a share, in the previous year's first nine months.

Flexsteel said gross margin in the latest quarter was 21% compared to 22.4% in the prior year.

The company attributed the drop in margins to raw material price increases, particularly in polyfoam — where there were "tremendous increases that continue," said President Bruce Lauritsen — and to changes in product mix, higher delivery expenses related to fuel costs, and weather-related expenses.

The weather contributed to higher utility costs, manufacturing interruptions at the company's plant in eastern Pennsylvania, and delivery inefficiencies in the Eastern third of the United States during February and early March.

"We took a beating in the third quarter," Lauritsen told analysts in a conference call.

For the nine months, the gross margin was 22.2%, compared to 21% for the prior year's nine months. The improvement was due to higher volume and improved fixed cost absorption in the first six months, offset by the third quarter's difficulties. In addition, the prior year's gross margin was reduced by a charge of $900,000 for facility closing costs.

During the third quarter, residential seating sales were $49 million, down 6% from the prior year. Recreational vehicle seating sales were $19.2 million, up 8%. Commercial seating sales were $5.3 million, up 38%.

Lauritsen said that galleries now make up about 50% of Flex-steel's business. Flexsteel has 40 galleries coming online, and 17 Christopher Lowell galleries.

Flexsteel Inds.
Earnings per share are fully diluted, and all figures in parentheses are losses or declines.
Quarter ended 3/31	2003	2002	Change
(a) Based on average shares outstanding of 6.4 million in the 2003 periods, 6.2 million in the 2002 quarter and 6.1 million in the 2002 nine months.
Sales	$73,461,304	$73,742,322	(0.4%)
Operating income	2,270,705	3,024,927	(24.9%)
Net income	1,420,985	2,014,818	(29.5%)
Earnings per share (a)	0.22	0.33	(33.3%)
9 months ended 3/31	2003	2002	Change
Sales	$217,060,741	$202,776,664	7.0%
Operating income	8,646,788	4,003,416	116.0%
Net income	(b)5,668,088	2,922,469	93.9%
Earnings per share (a)	0.89	0.48	85.4%

Share this on

FBI rebounds to profit

May 10, 2010

Cost cuts help Havertys post $501,000 profit

Nov 9, 2009

Flexsteel 4Q sales up 2%

Aug 26, 2007

Flexsteel 1Q sales dip as net income doubles

Oct 28, 2007

Sales gains drive tripling of net income in Flexsteel

Feb 9, 2003

Also by this author

Also by Staff Staff

Featured Company

Brandwise Inc.

Brandwise serves a model - not just an industry - by integrating, automating, and optimizing the entire sales channel, from wholesale Suppliers to their Reps and the Retailers they service. In short, our software helps Reps and Suppliers sell more and create... more

Related Resources

Atlanta International Gift & Home Furnishings Market

Here is a selection of products shown at this month's International Gift & Home Furnishings Market here.

Networking at the 13th annual F/T Leadership Conference

NAPLES, Fla. — Industry executives and guests took the opportunity to network and play golf during down time at Furniture/Today's 13th annual Leadership Conference here this month.