La-Z-Boy Reports Fiscal 2021 Second-Quarter Results
La-Z-Boy Incorporated (NYSE: LZB) reported solid second-quarter results for FY 2021, with consolidated sales rising 2.7% to $459.1 million. Operating income increased 62% to $47.9 million, while GAAP operating margin improved to 10.4%. Same-store sales for La-Z-Boy Furniture Galleries® surged 34%. The company generated $196 million in cash from operating activities, ending the quarter with $353 million in cash. A quarterly cash dividend of $0.14 per share was reinstated. Despite potential risks from COVID-19 and supply chain disruptions, optimism remains for continued strong performance into the second half of FY 2021.
- Consolidated sales increased 2.7% to $459.1 million.
- Operating income rose 62% to $47.9 million.
- GAAP operating margin increased to 10.4% from 6.6%.
- Same-store sales at La-Z-Boy Furniture Galleries® increased 34%.
- Generated $196 million in cash from operating activities year to date.
- Cash balance of $353 million at quarter end.
- Reinstated quarterly cash dividend of $0.14 per share.
- Delivered sales in the Wholesale segment decreased 2% to $343 million.
- Temporary supply shortage of polyurethane foam affecting unit volume.
- Risks associated with COVID-19-related shutdowns and supply chain disruptions.
Reinstates Full Dividend on Solid Results and Strong Outlook for Second Half of FY 21
MONROE, Mich., Nov. 17, 2020 (GLOBE NEWSWIRE) -- La-Z-Boy Incorporated (NYSE: LZB), a global leader in residential furniture, today reported strong operating results for the fiscal 2021 second quarter ended October 24, 2020.
Fiscal 2021 second quarter versus Fiscal 2020 second quarter:
- Consolidated sales increased
2.7% to$459.1 million - Written same-store sales for the entire La-Z-Boy Furniture Galleries® network increased
34% - Consolidated operating income:
- GAAP:
$47.9 million versus$29.6 million , an increase of62% - Non-GAAP(1):
$51.2 million versus$33.7 million , an increase of52%
- GAAP:
- Consolidated operating margin:
- GAAP:
10.4% versus6.6% - Non-GAAP(1):
11.1% versus7.5% - Wholesale(2):
12.2% versus10.6% - Retail:
9.4% versus5.8%
- Wholesale(2):
- GAAP:
- Net income attributable to La-Z-Boy Incorporated per diluted share (“EPS”):
- GAAP:
$0.75 versus$0.48 - Non-GAAP(1):
$0.82 versus$0.52
- GAAP:
- Strong cash generation, with fiscal year-to-date cash from operating activities of
$195.7 million - Cash(3) was
$353.4 million at quarter end after full repayment of$50 million outstanding balance on credit line
Kurt L. Darrow, Chairman, President and Chief Executive Officer of La-Z-Boy, said, "Demand across all La-Z-Boy Incorporated businesses is at record levels as consumers continue to allocate more discretionary spending to home furnishings. Orders are fueling an unprecedented backlog and our supply chain team is doing a great job to continually increase weekly production to service customers and drive increased delivered sales. For the quarter, we produced a double-digit consolidated operating margin, with all operating companies posting excellent results, including Joybird which turned a profit for the first time. With the well-known and trusted La-Z-Boy brand clearly resonating with consumers during these uncertain times, solid cash generation, a robust balance sheet, and prudent expense management, we are confident we will continue to adeptly navigate the challenging COVID-19 landscape while we remain focused on providing a safe environment for employees and customers."
Consolidated sales in the second quarter of fiscal 2021 increased
For the entire La-Z-Boy Furniture Galleries® network, written same-store sales increased
For the quarter, delivered sales in the company’s Wholesale(2) segment decreased
With the demand acceleration outpacing production acceleration, the company continued to increase weekly production levels and took the following actions to improve capacity moving forward:
- Added additional manufacturing cells at its U.S.-based upholstery manufacturing facilities as well as additional weekend shifts
- Temporarily re-activated a portion of its Newton, Mississippi assembly plant
- Added manufacturing cells at its Cut-and-Sew Center in Mexico
- Leased a 200,000 square-foot upholstery plant south of Yuma, Arizona, in San Luis Rio Colorado, Mexico, which is expected to start production in December with full ramp up extending over the first half of the new calendar year
Darrow stated, "In this stronger-than-expected demand environment, our supply chain team is demonstrating agility and flexibility to significantly increase production capacity on both an opportunistic and permanent basis. As part of our longer-term strategic plan, we have been considering alternatives to most efficiently serve the western portion of North America, and we are excited to take this first step with our new facility in Mexico."
The Retail segment delivered sales increased
During the second quarter, the company closed on the acquisition of six Seattle-based La-Z-Boy Furniture Galleries® stores with approximately
Within Corporate & Other, Joybird delivered its first profitable quarter on a sales increase of
GAAP diluted EPS was
Balance Sheet and Cash Flow
Year to date, the company generated
Dividend
On November 17, 2020, the Board of Directors declared a quarterly cash dividend on the company's common stock of
Business Outlook
Darrow concluded, "Although there is extreme uncertainty with respect to the pandemic, including the risk of COVID-19-related shutdowns affecting operations moving forward as well as risk of ongoing disruption within the global supply chain, such as the polyurethane foam issue, we are optimistic the company will deliver strong results in the second half of fiscal 2021. The strength of our brands and vast distribution network are driving strong written order trends across our entire business, translating to a significant increase in backlog. In addition, our supply chain team is making great progress to increase capacity so that we can shorten delivery times and service our customers with high-quality products. With the initiatives already underway, we expect to continue to significantly increase production capacity throughout the balance of the fiscal year."
Due to the unusual business trends driven by the pandemic, La-Z-Boy is providing perspective for the remainder of the year. The company does not intend to provide this level of forward-looking perspective regularly.
Provided there are no COVID-19-related shutdowns or other unexpected external disruptions impacting the company's operations, including global supply chain issues, such as with polyurethane foam, and taking all planned actions into account, La-Z-Boy expects consolidated sales growth in the third quarter of flat to
Presuming these sales trends sustain, the company expects to deliver a historically high consolidated operating margin of approximately
(1)Non-GAAP amounts for the second quarter of fiscal 2021 exclude:
- pre-tax purchase accounting charges related to acquisitions totaling
$3.0 million , or$0.06 per diluted share, primarily due to a write-up of the Joybird contingent consideration liability based on forecasted future performance, with$2.9 million included in operating income and$0.1 million included in interest expense - a pre-tax charge of
$0.3 million , or$0.01 per diluted share, related to the company’s business realignment, announced in June 2020, which included a10% reduction in the company's global workforce and the closure of its Newton, Mississippi upholstery manufacturing facility
Non-GAAP amounts for the second quarter of fiscal 2020 exclude:
- pre-tax purchase accounting charges of
$1.6 million , or$0.03 per diluted share, with$1.4 million included in operating income and$0.2 million included in interest expense - a pre-tax charge of
$2.8 million , or$0.04 per diluted share, related to the company's supply chain optimization initiative, including the closure of the company's Redlands, California upholstery manufacturing facility and relocation of its Newton, Mississippi leather cut-and-sew operations - pre-tax income of
$1.9 million , or$0.03 per diluted share, related to the 2019 termination of the company's defined benefit pension plan.
Please refer to the accompanying “Reconciliation of GAAP to Non-GAAP Financial Measures” for detailed information on calculating the Non-GAAP measures used in this press release and a reconciliation to the most directly comparable GAAP measure.
(2)Wholesale segment: Effective in the first quarter of fiscal 2021, in order to better align with the manner in which we view and manage the business, coupled with economic and customer channel similarities, the company revised its reportable operating segments by aggregating the former Upholstery segment with the former Casegoods segment to form the newly combined Wholesale segment. The change in reportable operating segments reflects how the company evaluates financial information used to make operating decisions. Prior-period results disclosed in this earnings release with respect to the Wholesale segment have been revised to reflect these changes.
(3)Cash includes cash, cash equivalents and restricted cash.
Conference Call
La-Z-Boy will hold a conference call with the investment community on Wednesday, November 18, 2020, at 8:30 a.m. eastern time. The toll-free dial-in number is 844.602.0380; international callers may use 862.298.0970.
The call will be webcast live, with corresponding slides, and archived on the Internet. It will be available at https://lazboy.gcs-web.com/. A telephone replay will be available for a week following the call. This replay will be accessible to callers from the U.S. and Canada at 877.481.4010 and to international callers at 919.882.2331. Enter Replay Passcode: 38471. The webcast replay will be available for one year.
Cautionary Note Regarding Forward-Looking Statements
This news release contains “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. Generally, forward-looking statements include information concerning expectations, projections or trends relating to our results of operations, financial results, financial condition, strategic initiatives and plans, expenses, dividends, share repurchases, liquidity, use of cash and cash requirements, borrowing capacity, investments, future economic performance, business, and industry and the effect of the novel coronavirus (“COVID-19”) pandemic on our business operations and financial results.
The forward-looking statements in this press release are based on certain assumptions and currently available information and are subject to various risks and uncertainties, many of which are unforeseeable and beyond our control, such as the continuing and developing impact of, and uncertainty caused by, the COVID-19 pandemic. Additional risks and uncertainties that we do not presently know about or that we currently consider to be immaterial may also affect our business operations and financial results. Our actual future results and trends may differ materially depending on a variety of factors, including, but not limited to, the risks and uncertainties discussed in our fiscal 2020 Annual Report on Form 10-K and other factors identified in our reports filed with the Securities and Exchange Commission. Given these risks and uncertainties, you should not rely on forward-looking statements as a prediction of actual results. We are including this cautionary note to make applicable and take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 for forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or for any other reason.
Additional Information
This news release is just one part of La-Z-Boy’s financial disclosures and should be read in conjunction with other information filed with the Securities and Exchange Commission, which is available at: https://lazboy.gcs-web.com/financial-information/sec-filings. Investors and others wishing to be notified of future La-Z-Boy news releases, SEC filings and quarterly investor conference calls may sign up at: https://lazboy.gcs-web.com/.
Background Information
La-Z-Boy Incorporated is one of the world’s leading residential furniture producers, marketing furniture for every room of the home. The Wholesale segment includes England, La-Z-Boy, American Drew®, Hammary®, and Kincaid®. The company-owned Retail segment includes 159 of the 355 La-Z-Boy Furniture Galleries® stores. Joybird is an e-commerce retailer and manufacturer of upholstered furniture.
The corporation’s branded distribution network is dedicated to selling La-Z-Boy Incorporated products and brands, and includes 355 stand-alone La-Z-Boy Furniture Galleries® stores and 561 independent Comfort Studio® locations, in addition to in-store gallery programs for the company’s Kincaid and England operating units. Additional information is available at http://www.la-z-boy.com/.
Non-GAAP Financial Measures
In addition to the financial measures prepared in accordance with accounting principles generally accepted in the United States ("GAAP"), this press release also includes Non-GAAP financial measures. Management uses these Non-GAAP financial measures when assessing our ongoing performance. This press release contains references to Non-GAAP operating income, Non-GAAP operating margin, Non-GAAP income before income taxes, Non-GAAP net income attributable to La-Z-Boy Incorporated and Non-GAAP net income attributable to La-Z-Boy Incorporated per diluted share, which may exclude, as applicable, business realignment charges, purchase accounting charges, charges for our supply chain optimization initiative, and impacts from terminating the company's defined benefit pension plan. The business realignment charges include severance costs, asset impairment costs, and costs to relocate equipment and inventory related to organizational changes we undertook as a result of our COVID-19 Action Plan. The purchase accounting charges may include the amortization of intangible assets, incremental expense upon the sale of inventory acquired at fair value, amortization of employee retention agreements, fair value adjustments of future cash payments recorded as interest expense, and adjustments to the fair value of contingent consideration. The charges for our supply chain optimization initiative may include severance costs, accelerated depreciation expense, costs to relocate equipment and inventory, as well as other costs related to the closure, relocation and sale of certain manufacturing operations. These Non-GAAP financial measures are not meant to be considered superior to or a substitute for La-Z-Boy Incorporated’s results of operations prepared in accordance with GAAP and may not be comparable to similarly titled measures reported by other companies. Reconciliations of such Non-GAAP financial measures to the most directly comparable GAAP financial measures are set forth in the accompanying tables.
Management believes that presenting certain Non-GAAP financial measures will help investors understand the long-term profitability trends of our business and compare our profitability to prior and future periods and to our peers. Management excludes purchase accounting charges because the amount and timing of such charges are significantly impacted by the timing, size, number and nature of the acquisitions consummated and the success with which we operate the businesses acquired. While the company has a history of acquisition activity, it does not acquire businesses on a predictable cycle, and the impact of purchase accounting charges is unique to each acquisition and can vary significantly from acquisition to acquisition. Similarly, business realignment charges and the charges related to the company’s supply chain optimization initiative are dependent on the timing, size, number and nature of the operations being moved or closed, and the charges may not be incurred on a predictable cycle. Management also excludes impacts from the termination of the company's defined benefit pension plan when assessing the company's operating and financial performance due to the one-time nature of the transaction. Management believes that exclusion of these items facilitates more consistent comparisons of the company’s operating results over time. Where applicable, the accompanying “Reconciliation of GAAP to Non-GAAP Financial Measures” tables present the excluded items net of tax calculated using the effective tax rate from operations for the period in which the adjustment is presented.
LA-Z-BOY INCORPORATED
CONSOLIDATED STATEMENT OF INCOME
| Quarter Ended | Six Months Ended | |||||||||||||||
| (Unaudited, amounts in thousands, except per share data) | 10/24/20 | 10/26/19 | 10/24/20 | 10/26/19 | ||||||||||||
| Sales | $ | 459,120 | $ | 447,212 | $ | 744,578 | $ | 860,845 | ||||||||
| Cost of sales | 258,565 | 264,823 | 427,660 | 510,744 | ||||||||||||
| Gross profit | 200,555 | 182,389 | 316,918 | 350,101 | ||||||||||||
| Selling, general and administrative expense | 152,616 | 152,788 | 264,654 | 297,078 | ||||||||||||
| Operating income | 47,939 | 29,601 | 52,264 | 53,023 | ||||||||||||
| Interest expense | (346 | ) | (308 | ) | (805 | ) | (626 | ) | ||||||||
| Interest income | 123 | 522 | 617 | 1,249 | ||||||||||||
| Other income (expense), net | (11 | ) | 1,368 | 1,463 | 608 | |||||||||||
| Income before income taxes | 47,705 | 31,183 | 53,539 | 54,254 | ||||||||||||
| Income tax expense | 12,401 | 8,279 | 13,556 | 13,362 | ||||||||||||
| Net income | 35,304 | 22,904 | 39,983 | 40,892 | ||||||||||||
| Net income attributable to noncontrolling interests | (369 | ) | (311 | ) | (250 | ) | (230 | ) | ||||||||
| Net income attributable to La-Z-Boy Incorporated | $ | 34,935 | $ | 22,593 | $ | 39,733 | $ | 40,662 | ||||||||
| Basic weighted average common shares | 46,023 | 46,551 | 45,966 | 46,686 | ||||||||||||
| Basic net income attributable to La-Z-Boy Incorporated per share | $ | 0.76 | $ | 0.48 | $ | 0.86 | $ | 0.87 | ||||||||
| Diluted weighted average common shares | 46,323 | 46,879 | 46,167 | 47,010 | ||||||||||||
| Diluted net income attributable to La-Z-Boy Incorporated per share | $ | 0.75 | $ | 0.48 | $ | 0.86 | $ | 0.86 | ||||||||
LA-Z-BOY INCORPORATED
CONSOLIDATED BALANCE SHEET
| (Unaudited, amounts in thousands, except par value) | 10/24/20 | 4/25/20 | ||||||
| Current assets | ||||||||
| Cash and equivalents | $ | 350,949 | $ | 261,553 | ||||
| Restricted cash | 2,478 | 1,975 | ||||||
| Receivables, net of allowance of | 128,324 | 99,351 | ||||||
| Inventories, net | 188,652 | 181,643 | ||||||
| Other current assets | 125,999 | 81,804 | ||||||
| Total current assets | 796,402 | 626,326 | ||||||
| Property, plant and equipment, net | 211,688 | 214,767 | ||||||
| Goodwill | 174,834 | 161,017 | ||||||
| Other intangible assets, net | 30,647 | 28,653 | ||||||
| Deferred income taxes – long-term | 18,990 | 20,839 | ||||||
| Right of use lease assets | 341,765 | 318,647 | ||||||
| Other long-term assets, net | 76,017 | 64,640 | ||||||
| Total assets | $ | 1,650,343 | $ | 1,434,889 | ||||
| Current liabilities | ||||||||
| Accounts payable | $ | 89,260 | $ | 55,511 | ||||
| Short-term borrowings | — | 75,000 | ||||||
| Lease liabilities, current | 65,758 | 64,376 | ||||||
| Accrued expenses and other current liabilities | 335,294 | 155,282 | ||||||
| Total current liabilities | 490,312 | 350,169 | ||||||
| Lease liabilities, long-term | 294,601 | 270,162 | ||||||
| Other long-term liabilities | 110,781 | 98,252 | ||||||
| Shareholders' equity | ||||||||
| Preferred shares – 5,000 authorized; none issued | — | — | ||||||
| Common shares, | 46,113 | 45,857 | ||||||
| Capital in excess of par value | 326,182 | 318,215 | ||||||
| Retained earnings | 378,438 | 343,633 | ||||||
| Accumulated other comprehensive loss | (3,957 | ) | (6,952 | ) | ||||
| Total La-Z-Boy Incorporated shareholders' equity | 746,776 | 700,753 | ||||||
| Noncontrolling interests | 7,873 | 15,553 | ||||||
| Total equity | 754,649 | 716,306 | ||||||
| Total liabilities and equity | $ | 1,650,343 | $ | 1,434,889 | ||||
LA-Z-BOY INCORPORATED
CONSOLIDATED STATEMENT OF CASH FLOWS
| Six Months Ended | ||||||||
| (Unaudited, amounts in thousands) | 10/24/20 | 10/26/19 | ||||||
| Cash flows from operating activities | ||||||||
| Net income | $ | 39,983 | $ | 40,892 | ||||
| Adjustments to reconcile net income to cash provided by operating activities | ||||||||
| (Gain)/loss on disposal of assets | 140 | (283 | ) | |||||
| Gain on sale of investments | (284 | ) | (99 | ) | ||||
| Change in deferred taxes | 1,849 | 273 | ||||||
| Provision for doubtful accounts | (1,568 | ) | 350 | |||||
| Depreciation and amortization | 16,351 | 14,936 | ||||||
| Equity-based compensation expense | 6,167 | 4,707 | ||||||
| Change in receivables | (28,949 | ) | (12,722 | ) | ||||
| Change in inventories | (3,511 | ) | (7,645 | ) | ||||
| Change in right-of use lease asset | 35,137 | 32,323 | ||||||
| Change in other assets | (1,926 | ) | (4,088 | ) | ||||
| Change in payables | 33,236 | 3,854 | ||||||
| Change in lease liabilities | (32,422 | ) | (32,665 | ) | ||||
| Change in other liabilities | 131,507 | 13,869 | ||||||
| Net cash provided by operating activities | 195,710 | 53,702 | ||||||
| Cash flows from investing activities | ||||||||
| Proceeds from disposals of assets | 21 | 88 | ||||||
| Proceeds from insurance | — | 1,018 | ||||||
| Capital expenditures | (15,442 | ) | (22,949 | ) | ||||
| Purchases of investments | (17,649 | ) | (17,798 | ) | ||||
| Proceeds from sales of investments | 19,470 | 13,171 | ||||||
| Acquisitions | (7,783 | ) | (5,875 | ) | ||||
| Net cash used for investing activities | (21,383 | ) | (32,345 | ) | ||||
| Cash flows from financing activities | ||||||||
| Payments on debt and finance lease liabilities | (75,013 | ) | (95 | ) | ||||
| Stock issued for stock and employee benefit plans, net of shares withheld for taxes | 364 | 571 | ||||||
| Purchases of common stock | — | (23,167 | ) | |||||
| Dividends paid to shareholders | (3,216 | ) | (12,151 | ) | ||||
| Dividends paid to minority interest joint venture partners (1) | (8,507 | ) | — | |||||
| Net cash used for financing activities | (86,372 | ) | (34,842 | ) | ||||
| Effect of exchange rate changes on cash and equivalents | 1,944 | 1,239 | ||||||
| Change in cash, cash equivalents and restricted cash | 89,899 | (12,246 | ) | |||||
| Cash, cash equivalents and restricted cash at beginning of period | 263,528 | 131,787 | ||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 353,427 | $ | 119,541 | ||||
| Supplemental disclosure of non-cash investing activities | ||||||||
| Capital expenditures included in payables | $ | 3,769 | $ | 5,805 | ||||
(1) Includes dividends paid to joint venture minority partners resulting from the repatriation of dividends from our foreign earnings that we no longer consider permanently reinvested.
LA-Z-BOY INCORPORATED
SEGMENT INFORMATION
| Quarter Ended | Six Months Ended | |||||||||||||||
| (Unaudited, amounts in thousands) | 10/24/20 | 10/26/19 | 10/24/20 | 10/26/19 | ||||||||||||
| Sales | ||||||||||||||||
| Wholesale segment: | ||||||||||||||||
| Sales to external customers | $ | 266,189 | $ | 277,221 | $ | 445,944 | $ | 529,994 | ||||||||
| Intersegment sales | 76,827 | 73,024 | 120,645 | 140,802 | ||||||||||||
| Wholesale segment sales | 343,016 | 350,245 | 566,589 | 670,796 | ||||||||||||
| Retail segment sales | 162,275 | 148,404 | 253,412 | 291,400 | ||||||||||||
| Corporate and Other: | ||||||||||||||||
| Sales to external customers | 30,656 | 21,587 | 45,222 | 39,451 | ||||||||||||
| Intersegment sales | 3,061 | 2,724 | 5,236 | 5,412 | ||||||||||||
| Corporate and Other sales | 33,717 | 24,311 | 50,458 | 44,863 | ||||||||||||
| Eliminations | (79,888 | ) | (75,748 | ) | (125,881 | ) | (146,214 | ) | ||||||||
| Consolidated sales | $ | 459,120 | $ | 447,212 | $ | 744,578 | $ | 860,845 | ||||||||
| Operating Income (Loss) | ||||||||||||||||
| Wholesale segment | $ | 41,683 | $ | 34,285 | $ | 59,623 | $ | 63,149 | ||||||||
| Retail segment | 15,093 | 8,412 | 8,466 | 16,889 | ||||||||||||
| Corporate and Other | (8,837 | ) | (13,096 | ) | (15,825 | ) | (27,015 | ) | ||||||||
| Consolidated operating income | $ | 47,939 | $ | 29,601 | $ | 52,264 | $ | 53,023 | ||||||||
LA-Z-BOY INCORPORATED
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
| Quarter Ended | Six Months Ended | |||||||||||||||
| (Amounts in thousands, except per share data) | 10/24/20 | 10/26/19 | 10/24/20 | 10/26/19 | ||||||||||||
| GAAP gross profit | $ | 200,555 | $ | 182,389 | $ | 316,918 | $ | 350,101 | ||||||||
| Add back: Purchase accounting charges - incremental expense upon the sale of inventory acquired at fair value | 133 | 198 | 430 | 315 | ||||||||||||
| Add back: Business realignment charges | 235 | — | 1,305 | — | ||||||||||||
| Add back: Supply chain optimization initiative | — | 2,754 | (50 | ) | 4,262 | |||||||||||
| Non-GAAP gross profit | $ | 200,923 | $ | 185,341 | $ | 318,603 | $ | 354,678 | ||||||||
| GAAP SG&A | $ | 152,616 | $ | 152,788 | $ | 264,654 | $ | 297,078 | ||||||||
| Less: Purchase accounting charges - adjustment to fair value of contingent consideration and amortization of intangible assets and retention agreements | (2,756 | ) | (1,191 | ) | (3,478 | ) | (2,383 | ) | ||||||||
| Less: Business realignment charges | (108 | ) | — | (2,580 | ) | — | ||||||||||
| Non-GAAP SG&A | $ | 149,752 | $ | 151,597 | $ | 258,596 | $ | 294,695 | ||||||||
| GAAP operating income | $ | 47,939 | $ | 29,601 | $ | 52,264 | $ | 53,023 | ||||||||
| Add back: Purchase accounting charges | 2,889 | 1,389 | 3,908 | 2,698 | ||||||||||||
| Add back: Business realignment charges | 343 | — | 3,885 | — | ||||||||||||
| Add back: Supply chain optimization initiative | — | 2,754 | (50 | ) | 4,262 | |||||||||||
| Non-GAAP operating income | $ | 51,171 | $ | 33,744 | $ | 60,007 | $ | 59,983 | ||||||||
| GAAP income before income taxes | $ | 47,705 | $ | 31,183 | $ | 53,539 | $ | 54,254 | ||||||||
| Add back: Purchase accounting charges recorded as part of gross profit, SG&A, and interest expense | 3,018 | 1,555 | 4,207 | 3,057 | ||||||||||||
| Add back: Business realignment charges | 343 | — | 3,885 | — | ||||||||||||
| Add back: Supply chain optimization initiative | — | 2,754 | (50 | ) | 4,262 | |||||||||||
| Less: Pension termination refund | — | (1,900 | ) | — | (1,900 | ) | ||||||||||
| Non-GAAP income before income taxes | $ | 51,066 | $ | 33,592 | $ | 61,581 | $ | 59,673 | ||||||||
| GAAP net income attributable to La-Z-Boy Incorporated | $ | 34,935 | $ | 22,593 | $ | 39,733 | $ | 40,662 | ||||||||
| Add back: Purchase accounting charges recorded as part of gross profit, SG&A, and interest expense | 3,018 | 1,555 | 4,207 | 3,057 | ||||||||||||
| Less: Tax effect of purchase accounting | (128 | ) | (413 | ) | (413 | ) | (753 | ) | ||||||||
| Add back: Business realignment charges | 343 | — | 3,885 | — | ||||||||||||
| Less: Tax effect of business realignment charges | (85 | ) | — | (940 | ) | — | ||||||||||
| Add back: Supply chain optimization initiative | — | 2,754 | (50 | ) | 4,262 | |||||||||||
| Less: Tax effect of supply chain optimization initiative | — | (731 | ) | 12 | (1,050 | ) | ||||||||||
| Less: Pension termination refund | — | (1,900 | ) | — | (1,900 | ) | ||||||||||
| Add back: Tax effect of pension termination refund | — | 504 | — | 468 | ||||||||||||
| Non-GAAP net income attributable to La-Z-Boy Incorporated | $ | 38,083 | $ | 24,362 | $ | 46,434 | $ | 44,746 | ||||||||
| GAAP net income attributable to La-Z-Boy Incorporated per diluted share | $ | 0.75 | $ | 0.48 | $ | 0.86 | $ | 0.86 | ||||||||
| Add back: Purchase accounting charges, net of tax, per share | 0.06 | 0.03 | 0.08 | 0.05 | ||||||||||||
| Add back: Business realignment charges, net of tax, per share | 0.01 | — | 0.07 | — | ||||||||||||
| Add back: Supply chain optimization initiative, net of tax, per share | — | 0.04 | — | 0.07 | ||||||||||||
| Less: Pension termination refund, net of tax, per share | — | (0.03 | ) | — | (0.03 | ) | ||||||||||
| Non-GAAP net income attributable to La-Z-Boy Incorporated per diluted share | $ | 0.82 | $ | 0.52 | $ | 1.01 | $ | 0.95 | ||||||||
LA-Z-BOY INCORPORATED
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
SEGMENT INFORMATION
| Quarter Ended | Six Months Ended | |||||||||||||||||||||||||||||||
| (Amounts in thousands) | 10/24/20 | % of sales | 10/26/19 | % of sales | 10/24/20 | % of sales | 10/26/19 | % of sales | ||||||||||||||||||||||||
| GAAP operating income (loss) | ||||||||||||||||||||||||||||||||
| Wholesale segment | $ | 41,683 | 12.2 | % | $ | 34,285 | 9.8 | % | $ | 59,623 |
{
"@context": "https://schema.org",
"@type": "FAQPage",
"name": "La-Z-Boy Reports Fiscal 2021 Second-Quarter Results FAQs",
"mainEntity": [
{
"@type": "Question",
"name": "What were La-Z-Boy's second-quarter earnings for FY 2021?",
"acceptedAnswer": {
"@type": "Answer",
"text": "La-Z-Boy reported earnings of $0.75 per diluted share (GAAP) and $0.82 per diluted share (Non-GAAP) for the second quarter."
}
},
{
"@type": "Question",
"name": "How much did La-Z-Boy generate in cash from operating activities in FY 2021?",
"acceptedAnswer": {
"@type": "Answer",
"text": "La-Z-Boy generated $196 million in cash from operating activities year to date."
}
},
{
"@type": "Question",
"name": "What is the current cash position of La-Z-Boy?",
"acceptedAnswer": {
"@type": "Answer",
"text": "La-Z-Boy ended the quarter with $353 million in cash."
}
},
{
"@type": "Question",
"name": "What is the impact of COVID-19 on La-Z-Boy's operations?",
"acceptedAnswer": {
"@type": "Answer",
"text": "La-Z-Boy faces risks associated with COVID-19-related shutdowns and disruptions in the global supply chain."
}
},
{
"@type": "Question",
"name": "When was La-Z-Boy's quarterly dividend reinstated?",
"acceptedAnswer": {
"@type": "Answer",
"text": "The quarterly cash dividend of $0.14 per share was reinstated on November 17, 2020."
}
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]
}
FAQ
What were La-Z-Boy's second-quarter earnings for FY 2021?
La-Z-Boy reported earnings of $0.75 per diluted share (GAAP) and $0.82 per diluted share (Non-GAAP) for the second quarter.
How much did La-Z-Boy generate in cash from operating activities in FY 2021?
La-Z-Boy generated $196 million in cash from operating activities year to date.
What is the current cash position of La-Z-Boy?
La-Z-Boy ended the quarter with $353 million in cash.
What is the impact of COVID-19 on La-Z-Boy's operations?
La-Z-Boy faces risks associated with COVID-19-related shutdowns and disruptions in the global supply chain.
When was La-Z-Boy's quarterly dividend reinstated?
The quarterly cash dividend of $0.14 per share was reinstated on November 17, 2020.
La-Z-Boy Incorporated
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Furnishings, Fixtures & Appliances
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