La-Z-Boy posts $11 million profit in quarter
Sales rise 5.7% from a year earlier
Larry Thomas -- Furniture Today, February 17, 2010
MONROE, Mich. — La-Z-Boy recorded a profit of $11 million in the quarter ended Jan. 23 as sales rose 5.7%.The quarterly profit, which equals 21 cents per share, reversed a net loss in the comparable period a year earlier, and marked the company's fourth consecutive profitable quarter after a string of money-losing quarters.
Sales for the period, the third quarter of La-Z-Boy's fiscal year, totaled $305.1 million. That was up from $288.6 million in the quarter ended Jan. 24, 2009.
"Although we are comparing the period to a low-volume quarter last year, we believe the strength of the La-Z-Boy brand, with the inherent quality associated with it, and our mid-price-point focus has served our company well in this environment," said Kurt Darrow, president and CEO. "We are also encouraged that the consumer appears to be slowly returning to the marketplace."
Sales in the upholstery segment were up 17.6% to $234.3 million, including a one-time accounting adjustment for the timing of inter-company revenue recognition. Without the revenue adjustment, sales in the segment rose 11%.
The upholstery segment's operating margin was 11.1%
Sales in the case goods segment fell 14.5% to $36 million, but the segment eked out a small profit and posted an operating margin of 0.8%.
Sales at the 68 company-owned retail stores were $40.4 million, essentially even with the same quarter last year, and the group recorded an operating loss of $4.1 million.
For all 308 La-Z-Boy Furniture Galleries stores, same-store written sales rose 3.9% in the quarter. For the calendar year 2009, same-store sales decreased 5.7%.
"While we remain concerned about various economic factors, particularly unemployment and credit availability, we note some positive signs with respect to La-Z-Boy's same-store-sales figures, the strength of our upholstery sales performance this quarter as well as continued progress in our retail segment," Darrow said.
For the nine months ended Jan. 23, sales declined 7.8% to $868.5 million.,
The nine-month profit came to $18.9 million or 36 cents per share. In the first nine months of the previous fiscal year, the company had a net loss of $127.8 million or $2.49 per share.
The previous year's bottom line included writedowns of nearly $55 million in the value of intangibles, as well as $8.1 million in money received from antidumping duties for Chinese-made bedroom furniture.
In the first nine months of the current fiscal year, the company received $4.4 million from antidumping duties.
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La-Z-Boy earns $11M profit
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