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La-Z-Boy Earnings Drop Slightly

By Home Furnishings Business in on February 2006 La-Z-Boy posted a slight decrease in fiscal third-quarter earnings as it continued to deal with slower sales, but its profits still beat analysts' expectations, the company announced this week.

Earnings for the quarter ended Jan. 28 slipped to $10.5 million, or 20 cents a share, from $11.1 million, or 21 cents a share, during the same period last year. The earnings included 1 cent a share in restructuring costs.

The earnings topped the company's own forecast, as well as Wall Street's expectations. In November, La-Z-Boy forecast earnings of 13 cents to 17 cents a share, including the 1-cent restructuring charge. Analysts polled by Thomson First Call had an average estimate for earnings of 15 cents a share.

La-Z-Boy's sales, however, fell to $502.3 million from $507 million, just missing analysts' expectations of $503 million.

"Overall, we are encouraged with our results for the quarter, as they indicate that the execution of our strategy in our two largest business segments, upholstery and case goods, is progressing with the acceleration and speed we expected," said Kurt Darrow, president and chief executive officer.

La-Z-Boy, noting uncertainty about the overall economic environment, forecast flat fourth-quarter sales and earnings of 26 cents to 32 cents a share. Analysts target earnings of 31 cents a share and sales of $562 million for the fourth quarter. In last year's fourth quarter, the company earned 35 cents a share from continuing operations on sales of $565.6 million.

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