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From Home Furnishing Business

La-Z-Boy Sets Quarterly Highs in Sales, Operating Profits & Operating Margin

La-Z-Boy established new quarterly records in sales, operating profits and operating margin in the quarter ended July 30 as it bucked the trend of declining furniture sales.

The record numbers included a 15% increase in consolidated sales to $604.1 million, and a 30% leap in sales from company-owned retail stores to $236 million. The operating profit and operating margin in the retail segment also set all-time quarterly records, while the operating profit and operating margin from consolidated sales set new records for the first quarter of its fiscal year.

"We delivered excellent results for the quarter, amidst challenging trends for the global economy and the furniture industry,” said Melinda Whittington, president and CEO. “We are focused on navigating the near-term volatile environment with agility while strengthening our business for the long term with our Century Vision strategy.”

Net income for the quarter jumped 57 percent to $38.5 million, or 89 cents per share. In last year’s first fiscal quarter, the figures were $24.6 million, 54 cents per share.

"In the near term, we remain focused on working down our backlog to drive delivered sales and enhance service to customers with shorter, pre-pandemic lead times,” Whittington added. “Our supply chain team continues to improve results and reduce start-up friction costs at our new plants in Mexico to strengthen wholesale gross margins over time. At the same time, we have increased our marketing spend to pre-pandemic levels to increase traffic and conversion and support the equity of our brands.”

In the retail segment, delivered same-store sales rose 25%, but written same-store sales – which include sales of merchandise that hasn’t been delivered – dropped 15%, The company said the decline reflected the normal summer slowdown as well as consumer concerns about the economy. However, written same-store sales were still 12% higher than pre-pandemic levels.

At the end of the quarter, there were had 348 stand-alone La-Z-Boy retail stores, including 166 that are company owned. The company completed the purchase of five retail stores in the Denver market during the quarter.

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