Flexsteel Sees Record 2Q Sales; Earnings Drop
Furniture supplier Flexsteel Industries Inc. today (Feb. 6) reported record sales for its second quarter and six months, ended Dec. 31.
Net income for the quarter was $1.2 million, or 16 cents per share, compared to $2.9 million, or 40 cents per share, for the prior year quarter. Adjusted net income in the quarter was $4.5 million, or 60 cents per share, compared to $3.3 million, or 46 cents per share, a year ago. Sales during the quarter increased 19% to $113 million from $95 million, representing a record for the three-month period.
The Dubuque, Iowa-based company reported net income of $4.9 million, or 66 cents per share, for the six months compared to $5.8 million, or 80 cents per share, for the prior year. Adjusted net income for the current year six-month period was $8.9 million, or $1.18 per share, compared to $6.5 million, or 89 cents per share, a year ago. Sales were a record $217 million, a 17% increase from the year prior.
Gross margin for the six months was 22.9% of net sales compared to 23.6% of net sales in the prior year period. Gross margin for the quarter was 23.2% versus 24% in 2012. The decrease in the current year periods was primarily due to price discounting on certain case goods to address changing customer requirements.
Flexsteel reported that in December 2013 the company entered into an agreement to settle civil litigation alleging it polluted the water wells of some Elkhart, Ind., homes. The company will contribute $6.3 million to the settlement as part of an agreement. In reaching the agreement, the company does not admit any wrongdoing and believes that it did not cause or contribute to the contamination at issue.
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