La-Z-Boy Incorporated sales increased 41% to $519.5 million

La-Z-Boy Incorporated [LZB] a global leader in residential furniture, today reported strong operating results for the fiscal 2021 fourth quarter and full year ended April 24, 2021.

Fiscal 2021 fourth quarter versus Fiscal 2020 fourth quarter:

•Consolidated sales increased 41% to $519.5 million

•Written same-store sales for the entire La-Z-Boy Furniture Galleries® network doubled, increasing 100%

•Consolidated operating margin:

◦GAAP: 9.6% versus 3.7%

◦Non-GAAP(1): 10.0% versus 9.3%

▪Wholesale(2): 10.2% versus 11.1%

▪Retail: 12.2% versus 10.8%

•Net income attributable to La-Z-Boy Incorporated per diluted share (“EPS”):

◦GAAP: $0.81 versus $0.05

◦Non-GAAP(1): $0.87 versus $0.49

•The company returned $50 million to shareholders through share repurchases and dividends

Fiscal 2021 full year versus Fiscal 2020 full year:

•Consolidated sales increased 1.8% to $1.7 billion

•Written same-store sales for the entire La-Z-Boy Furniture Galleries® network increased 31%

•Consolidated operating margin:

◦GAAP: 7.9% versus 7.0%

◦Non-GAAP(1): 9.0% versus 8.2%

▪Wholesale(2): 10.6% versus 10.6%

▪Retail: 7.7% versus 8.2%

▪Joybird became profitable

•Net income attributable to La-Z-Boy Incorporated per diluted share (“EPS”):

◦GAAP: $2.30 versus $1.66

◦Non-GAAP(1): $2.62 versus $2.16

•Cash generated from operating activities of $310 million versus $164 million in the prior year

•Cash(3) at fiscal year end increased to $395 million versus $264 million in the prior year

•The company returned $61 million to shareholders through share repurchases and dividends

"For the fiscal 2021 fourth quarter, record sales led to all-time record profits driven by increased production capacity, excellent performance by our company-owned La-Z-Boy Furniture Galleries® stores, and continued growth and profitability at Joybird. And, fiscal 2022 is off to a great start with continued robust written order rates and a record backlog, setting us up well for a strong year of shipments ahead."

Consolidated sales in the fourth quarter of fiscal 2021 increased 41.4% to $519.5 million versus the fiscal 2020 fourth quarter, which was impacted by COVID-19-related plant and retail closures. Consolidated GAAP operating margin increased to 9.6% versus 3.7% in the prior-year fourth quarter. Consolidated non-GAAP(1) operating margin improved to 10.0% versus 9.3% in last year’s fourth quarter, reflecting strong performance across all business units.

For the entire La-Z-Boy Furniture Galleries® network, written same-store sales doubled, increasing 100%, for the fiscal 2021 fourth quarter compared with the fiscal 2020 fourth quarter. Compared with the pre-pandemic fiscal 2019 fourth quarter, written same-store sales for the La-Z-Boy Furniture Galleries® network increased 29%.

For the fiscal 2021 fourth quarter, delivered sales in the company’s Wholesale(2) segment increased 40% to $384.0 million compared with the prior-year fourth quarter, which was impacted by COVID-19. Non-GAAP(1) operating margin for the Wholesale(2) segment was a healthy 10.2% versus 11.1% for the prior-year period, reflecting disciplined cost management on advertising which helped offset higher raw material and freight costs and expenses to expand production capacity to service record backlog. Last year's fourth quarter benefited from a one-time rebate of previously paid tariffs partially offset by higher bad debt expense.

Retail segment delivered sales increased 39% to $193.5 million in the fourth quarter of fiscal 2021 compared with the prior-year fourth quarter. Written same-store sales for the company-owned La-Z-Boy Furniture Galleries® stores more than doubled, increasing 114% in the quarter, reflecting positive trends across all sales metrics, including traffic, conversion and average ticket, versus last year's fourth quarter which included store closures during the last four weeks of the period. Non-GAAP(1) operating margin for the Retail segment was 12.2% in the fiscal 2021 fourth quarter versus 10.8% in last year’s fourth quarter, primarily driven by fixed-cost leverage on higher delivered sales volume.

Within Corporate & Other, Joybird sales more than doubled compared with the prior-year quarter, increasing 144% to $37.7 million. Written sales increased 125% compared with the prior-year quarter, reflecting ongoing strong order trends and the strength of the brand in the online marketplace. For the third consecutive quarter, Joybird posted strong gross margins, delivered profitable growth and increased conversion rates while increasing its marketing spend to drive customer acquisition.