MONROE, Mi. - From $13.8 million to $11.7 million, Furniture giant La-Z-Boy Inc. reported a 15.16 percent decrease in net income for the first quarter of its 2018 fiscal year compared to last year’s first quarter.
Earnings per share for the quarter were 24 cents, down from 28 cents for the same quarter last year.
“After a strong finish to fiscal 2017, we are disappointed with our start to this fiscal year,” said Kurt L. Darrow, company president and CEO, in the company’s earnings release. “Although we posted a consolidated sales increase for the quarter, much of it related to acquired sales that did not add volume to our upholstery manufacturing operations, which is our most profitable segment.” Darrow expressed disappointment with the company's start to the fiscal year.
The company reported increased consolidated sales of $357.1 million for the 2018 fiscal 1Q, an increase of 4.8 percent over last year’s first quarter but a decrease from 2017’s 4Q total of $412.7 million.
Upholstery segment sales increased 2.6 percent to $274.4 million from last year, while operating margins declined 8.5 percent from 11.4 percent, with a 1 percent benefit from a legal settlement.
Casegoods segment sales rose to $25.5 million, up nearly 2 percent over last year. The operating margin also rose 2.1 percent over last year.
During a conference call to discuss quarterly earnings results, Darrow said the company is talking with Amazon about potential opportunities “that would complement and support our existing distribution.” Darrow said that nothing yet is definitive.
“While the La-Z-Boy brand is extremely powerful, it has a core demographic and we recognize the brand does not effectively reach all consumers, particularly millennials and Gen X consumers, who are looking for non-traditional brands and experiences,” he said during the call.
The consideration to sell on Amazon comes with the e-commerce giant's recent decision to sell bigger furniture online.