by Retail sales driven by opening of new stores, acquisition of existing independent La-Z-Boy Furniture Galleries
MONROE, Mich. — La Z Boy reported an increase in Q4 and full-year sales for the period ended April 25.
Sales for the quarter totaled $570.9 million, up 3% from $553.5 million the same period last year. Adjusted quarterly net income totaled $38.4 million, or 92 cents per share, compared with $40.8 million, or 95 cents per share the same period last year.
Adjusted operating income was $43.6 million, up 3% from $52.1 million last year.
Sales for the wholesale segment totaled $402 million for the quarter, compared with $392.5 million, the same period last year, a 2.4% increase. Operating income for the segment totaled $10.1 million compared with $31.7 million the same period last year.
Retail segment sales totaled $246.8 million for the quarter, up 8.3% from $227.9 million the same period last year. It reported $32.4 million in operating income compared with $32.2 million in operating income the same period last year.
For the retail segment, written sales increased by 3% related to new and acquired stores while written same-store sales decreased 5%, which the company attributed to continued weakness in store traffic, partially offset by higher average ticket and design sales.
Overall consolidated operating income for the quarter was $29.5 million, compared with $50.1 million the same period last year.
The company reported a consolidated GAAP operating margin of 5.2% versus 9.1% a year ago.
Meanwhile, it noted that consolidated adjusted operating margin was flat at 9.4% versus the year ago period, “as lower input costs (reduced commodity prices and improved sourcing) and leverage on marketing investments were offset by the impact of a significant customer transition in our international wholesale business as well as acceleration of tariff expenses in the quarter.”
Melinda D. Whittington, board chair, president and chief executive officer, said that the fourth quarter results “reflect the ongoing strengthening of our brand and operations under our Century Vision strategy.”
“We executed well throughout the year with sales growth across all of our segments and four consecutive quarters of top line growth, even as the industry contends with depressed housing fundamentals and growing macro uncertainty. We are controlling what we can control with distinct strategies and initiatives across each of our businesses.”
“In Retail, we continue to grow our direct-to-consumer business, own the entire end-to-end consumer experience, and develop more value-added consumer insights. Through opening net new stores and also acquiring existing independent La-Z-Boy Furniture Galleries, we reached a new milestone in the quarter, growing our company-owned store footprint to over 200 stores, nearly doubling our store count over the last 10 years, and now owning 55% of the total network.
“In Wholesale, we continue to expand our brand reach with compatible strategic partners to serve more consumers. Additionally, we are successfully driving scale and efficiencies in our supply chain. This is highlighted by our core North America La-Z-Boy wholesale business achieving sales growth and margin expansion for four consecutive quarters during fiscal 2025, and continuing to strengthen as we initiate our multi-year distribution and delivery redesign.”
For the full year, the company reported $2.1 billion in sales, up 3% from $2.05 billion last year.
It reported adjusted net income of $123.7 million, or $2.92 per share, down 4% from $129.1 million, or $2.98 per share the same period last year. Adjusted operating income was $160.8 million, up 1% from $159.4 million the same period last year. Adjusted operating margin for the year was 7.6% compared with 7.8% last year.
Other highlights of the report were as follows:
+ Joybird written sales decreased 21% “as recent economic and industry trends disproportionately impacted the Joybird online consumer.”
+ Delivered sales in the segment decreased 2% to $36 million “as positive growth within existing stores was offset by declines in the online business.”
+ Joybird adjusted operating margin was positive in the fourth quarter, relatively flat versus prior year
+ The company said it ended the quarter with $328 million in cash and no external debt
+ It also reported generating $187 million in cash from operating activities (up 18% from the prior year) including $62 million in the fourth quarter (up 17% from the prior year comparable period), versus $158 million in Fiscal 2024 and $53 million in last year’s fourth quarter
+ The company also said it invested $74 million in capital expenditures, primarily related to new stores and remodels for La-Z-Boy Furniture Galleries
+ It also said it returned about $113 million to shareholders, including $78 million in share repurchases and $35 million in dividends
In closing, Whittington said that while global economic uncertainty will continue to challenge consumers in the near term, the company “is confident in the strength of our business model to outperform our peers and deliver strong financial performance.”
“La-Z-Boy is an iconic brand in a highly fragmented market,” she said. “We have successfully navigated challenging times throughout our 98-year history by delivering comfort and quality to our consumers. A strong balance sheet combined with an agile supply chain provides us a position of strength in the industry. We will continue to execute our playbook to mitigate an ever changing environment and drive long-term profitable growth and returns for all stakeholders.”
