La-Z-Boy (LZB) Tops Q2 EPS by 32c, Revenue Beats, Offers Outlook

La-Z-Boy (NYSE: LZB) reported Q2 EPS of $0.82, $0.32 better than the analyst estimate of $0.50. Revenue for the quarter came in at $459.1 million versus the consensus estimate of $433.73 million.

Business Outlook:

Darrow concluded, "Although there is extreme uncertainty with respect to the pandemic, including the risk of COVID-19-related shutdowns affecting operations moving forward as well as risk of ongoing disruption within the global supply chain, such as the polyurethane foam issue, we are optimistic the company will deliver strong results in the second half of fiscal 2021. The strength of our brands and vast distribution network are driving strong written order trends across our entire business, translating to a significant increase in backlog. In addition, our supply chain team is making great progress to increase capacity so that we can shorten delivery times and service our customers with high-quality products. With the initiatives already underway, we expect to continue to significantly increase production capacity throughout the balance of the fiscal year."

Due to the unusual business trends driven by the pandemic, La-Z-Boy is providing perspective for the remainder of the year. The company does not intend to provide this level of forward-looking perspective regularly.

Provided there are no COVID-19-related shutdowns or other unexpected external disruptions impacting the company's operations, including global supply chain issues, such as with polyurethane foam, and taking all planned actions into account, La-Z-Boy expects consolidated sales growth in the third quarter of flat to 4% above the prior year's all-time record-high third quarter. Further, accounting for continued growth and the effects of the month-long pandemic shutdown in the prior-year fourth quarter base period, the company anticipates fiscal 2021 fourth-quarter sales growth of 40% to 45% versus the prior-year quarter.

Presuming these sales trends sustain, the company expects to deliver a historically high consolidated operating margin of approximately 9% to 11% for the balance of the year. Included in these margin expectations is the anticipation that Joybird will sustain profitable operations.

For earnings history and earnings-related data on La-Z-Boy (LZB) click here.

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