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Flexsteel sales rise 7.3% in quarter but profits slip 6.7%

Andrea Lillo, Larry Thomas -- Furniture Today, April 17, 2013

DUBUQUE, Iowa — Increased demand for upholstered furniture drove Flexsteel Inds. to a 7.3% sales increase in the quarter ended March 31.

Profits, however, slipped 6.7% as margins were squeezed by changes in product mix and increased freight and raw materials costs.

Flexsteel, a manufacturer and importer of upholstery and case goods, said residential furniture sales rose 12.3% in the quarter, while commercial furniture sales fell 9.9%.

Net sales totaled $98.4 million, up from $91.6 million in the same quarter last year.

Net income was $3.12 million or 42 cents per share. That was down from $3.34 million or 48 cents per share in the comparable quarter a year ago.

For the nine months ended March 31, net sales were $284.2 million, an increase of 10.1% from $258.2 million in the first nine months of the previous fiscal year.

Residential furniture sales were $228.9 million in the nine-month period, an increase of 14% from the first nine months of the previous fiscal year.

Nine-month profits totaled $8.91 million or $1.22 per share. That was up from $8.67 million or $1.24 per share in the comparable period. The company had about 7.3 million outstanding shares as of March 31, compared with 6.97 million outstanding shares a year earlier.

In a statement accompanying the earnings announcement, the company said is believes "moderate top line growth" will continue through the end of the 2013 calendar year. The growth will continue to be driven by increased demand for upholstery, the company said.

"The company is confident of its ability to take advantage of market opportunities. However, our optimism is tempered due to continued economic uncertainty and its impact on the consumers' confidence and willingness to buy," the statement read.

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