La-Z-Boy Posts Strong Q4 Performance Amid Challenging Market Conditions
La-Z-Boy Incorporated, a leading manufacturer of comfort and style in the home furnishings industry, reported strong fourth-quarter (Q4) results despite softness across the category. The company's Retail Segment delivered sales growth of 9%, driven by acquisitions in new stores and strategic initiatives.
In a conference call on June 17, La-Z-Boy's Board Chair, President, and Chief Executive Officer, Melinda Whittington, highlighted the company's strong execution and continued progress on its strategic initiatives. The Retail Segment delivered sales of $523 million, up 9% from the prior year, with adjusted operating margin strengthening to almost 14%. This impressive performance marked a sequential improvement over the third quarter and was driven by the opening of four new stores during the quarter.
Whittington noted that the company's Wholesale Segment delivered sales decreased slightly, but adjusted operating margin improved versus the prior year. The total fiscal year saw La-Z-Boy report $2.1 billion in consolidated delivered sales, up from the previous year, with Retail Segment delivered sales increasing 6% versus the prior year.
La-Z-Boy's strategic initiatives were evident in its record-breaking annual net new store openings, with a total of 15 stores opened during the fiscal year. The company also completed its largest-ever acquisition of 15 independent La-Z-Boy stores, further expanding its retail footprint. In addition, La-Z-Boy generated $204 million in operating cash flow, up 9% from the prior year, and returned $85 million to shareholders through share repurchase and dividends.
The company's strong balance sheet was maintained with just over $300 million in cash and no external debt. Whittington expressed pride in La-Z-Boy's strong finish to this fiscal year, which delivered on expectations despite challenging market conditions. The company remains focused on driving its own momentum through retail business expansion, new store openings, and strong in-store execution.
La-Z-Boy's ability to drive its own growth was evident in its consumer trends analysis. During the fourth quarter, total written sales for the company-owned retail segment increased 11% versus last year's fourth quarter, driven by acquired and new stores. While same-store sales decreased 2%, this marked a sequential improvement over the third quarter, with positive comps reported in April and May.
Despite industry data indicating a decline in the low to mid-single digits during the quarter, La-Z-Boy continues to leverage its iconic brand, agile business model, and strategic initiatives to drive retail growth and gain share in the large and heavily fragmented furniture and home furnishings industry. With a focus on controlling the entire end-to-end consumer experience, the company remains committed to delivering comfort and style in the home furnishings market.
