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Flexsteel sales rise 4%

By Furniture Today Staff -- Furniture Today, October 20, 2006

Dubuque, Iowa — Upholstery major Flexsteel Inds. said sales in its first quarter rose 4%, but net income plunged 42.9% due to higher interest expenses and higher costs of goods sold.

The company said sales declined in its residential furniture and recreational vehicle seating segments, but commercial seating sales rose 35.7%.

"Retail furniture stores, the primary driver of demand for our residential seating products, have faced a very challenging business environment for the last 18 months," the company said in a statement. "We continue to take actions to address top-line growth for each product application and our overall profitability by focusing on those areas that we can control or significantly influence."

Total sales for the quarter ended Sept. 30 were $101.3 million. That compares with $97.4 million in last year's first fiscal quarter.

The company said residential furniture sales in the quarter dropped 2.2% to $56.9 million, while recreational vehicle seating sales were off 12.8% to $15.9 million. Commercial seating sales rose to $28.5 million.

Net income totaled $563,125 or 9 cents per share. That compares with $985,553 or 15 cents per share in the comparable quarter last year.

Gross margin for the quarter was 18.2%, compared with 19.6% in the same quarter last year. The company said increased manufacturing and warehousing costs, as well as under-utilization of manufacturing capacity, were key factors in the decline.

"We continue to take actions to address top-line growth for each product application and our overall profitability by focusing on those areas that we can control or significantly influence."

Flexsteel Inds.
Quarter ended 9/30	2006	2005	Change
Sales	$101,339,556	$97,435,163	4.0%
Operating income	1,124,250	1,656,529	(32.1%)
Net income	563,125	985,553	(42.9%)
Earnings per share	0.09	0.15	(40.0%)

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Flexsteel sales rise 4%

Oct 23, 2006

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