Flexsteel earnings jump 31% as sales rise 14% in first quarter
Larry Thomas -- Furniture Today, October 16, 2013
DUBUQUE, Iowa — Powered by its upholstery and ready-to-assemble furniture segments, Flexsteel Inds. reported double-digit sales and earnings growth in the first quarter of its fiscal year.
The company said it was the strongest first quarter in its history.
For the three months ended Sept. 30, sales totaled $104.3 million, an increase of 14.4% from $91.2 million in the same quarter last year.
Residential furniture sales were up approximately 16% to $84 million, while commercial furniture rose about 8% to $20.3 million, the company reported.
Net income was $3.77 million or 51 cents per share. That was up 31.2% from $2.87 million or 40 cents per share in last year's first fiscal quarter.
The bottom-line increase came even though gross margin slipped 0.4% to 22.7% of sales. The company said the decrease was due primarily to changes in product mix and price discounting on traditional case goods to improve operating efficiency.
"The discounting may continue for the remainder of the fiscal year as we realign inventory to focus on growth opportunities," the company said in a statement accompanying the earnings report.
The company also said it believes top-line growth will continue through the end of the fiscal year on June 30, 2014.
"Residential growth is expected to continue with existing customers and products, and through expanding our product portfolio and customer base," the statement said. "The company expects this growth to be led by increased demand for upholstered and ready-to-assemble products."