La-Z-Boy reverses loss, but sales decline 7.8%
Board cuts quarterly dividend
Larry Thomas -- Furniture Today, February 20, 2008
MONROE, Mich. — La-Z-Boy said Tuesday that it reversed a net loss from last year’s third fiscal quarter, but the company’s board of directors voted to slash its quarterly dividend due to continued weakness in the housing and home furnishings markets.
That weakness resulted in a 7.8% sales decline in the quarter ended Jan. 26, as the company experienced shortfalls in its upholstery, case goods and retail business segments.
However, the company recorded net income of $9.5 million or 19 cents per share. That compares with a net loss of $7.8 million or 15 cents per share in last year’s third fiscal quarter.
The most recent quarter included income of 9 cents per share from antidumping duties the U.S. government collects on imported Chinese wood bedroom furniture. Last year’s third quarter included one-time charges of 29 cents per share from a writedown of the value of intangible assets.
Sales in the most recent quarter totaled $373.1 million, compared with $404.8 million in last year’s third quarter.
Directors voted to cut the dividend from 12 cents per share to 4 cents per share in order to pay down debt and plow more cash back into the business.
“The board believes this redeployment of cash into the business to transform the company will ultimately provide a better return for shareholders,” directors said in a statement issued by the company.
In the most recent quarter, upholstery sales declined 3.8%, case goods sales were down 16.6% and sales at company-owned retail stores slid 18.4%.
For the first nine months of La-Z-Boy’s fiscal year, total sales were down 10.8% to $1.08 billion.
The company recorded a nine-month net loss of $9.1 million or 18 cents per share. In the first nine months of the previous fiscal year, the net loss was $3.6 million or 7 cents per share.
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La-Z-Boy reverses loss
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