Dubuque, Iowa-based Flexsteel Industries Inc. reported lower earnings on an increase in sales for its fiscal fourth quarter, ended June 30, while net income for the full year was the highest in the company’s history.
Sales during the quarter were $102 million, a 9% increase from $94 million the year prior while net income was $4.2 million, or 57 cents per diluted share, compared to $4.4 million, or 61 cents per share. Residential sales rose 10% to $82 million and commercial sales totaled $20 million compared to $19 million in the prior year quarter.
Sales for the full year increased 10% to $386 million compared to $352 million in the prior fiscal year. Net income rose to $13.2 million, or $1.80 per diluted share, from $13.1 million, or $1.86 per share. The current year includes executive transition costs of $1.3 million.
Residential sales grew 13% to $311 million in the current fiscal year from $275 million a year ago. Commercial sales were $75 million compared to $77 million in the prior fiscal year.
Gross margin for the fiscal year ended June 30, 2013 was 23.4% compared to 24.2% for the prior fiscal year. During fiscal year 2013, the company’s expenses related to workers compensation and health insurance programs were approximately $1.5 million or 0.4% of net sales higher than fiscal 2012. Gross margin for the quarter ended was 23.3% compared to 25.3% in the prior year quarter. For the quarter the gross margin percentage change is primarily due to changes in product and customer mix, and increased workers compensation insurance expenses.
Working capital (current assets less current liabilities) at June 30 was $113.7 million compared to $103.7 million at June 30, 2012. Significant changes in working capital from June 30, 2012 to June 30, 2013 included increases in inventories of $9.7 million, other current assets of $4.4 million and accounts receivable of $2.5 million.
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