Losses widen at LL Flooring in Q2
LL Flooring reported second quarter 2023 net sales fell 21% to $236.4 million from second quarter 2022 sales of $299 million.
Total comparable store sales decreased 22.2% during the quarter.
Net sales for the first half of 2023 reached $477.1 million, falling more than 17% from net sales of $578 million in the first six months of 2022.
The Richmond, Virginia-based flooring retailer also posted a net loss of $39 million for the period compared to a net income of $2.7 million for the same period a year ago. The company posted a $10.6 million net loss in the first quarter of this year.
For the first six months of 2023, LL Flooring has reported a net loss of $49.6 million in comparison to a net income of $6.8 million for the first half of 2022.
During the second quarter, the Company closed one store, bringing its total store count to 442 as of June 30.
In late June, the retailer's board of directors unanimously rejected an unsolicited, non-binding proposal from Cabinets To Go, LLC.
Cabinets To Go, a subsidiary of F9 Brands, Inc., had proposed acquiring all of LL Flooring’s outstanding shares for $5.76 per share in cash.
LL Flooring acknowledged receipt of the unsolicited proposal on May 30.
Share prices of LL Flooring closed at $3.41 on Aug. 8 and were trading nearly 10% lower at $3.08 on the morning of Aug. 9.
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The Bottom Line: Profits tumble as LL Flooring posts a $39 million loss in the second quarter.
What the CEO said: "Our second quarter performance primarily reflected the continued impact of the difficult macro backdrop that has impacted big-ticket discretionary purchases as well as the demand for home remodeling projects,” said Charles Tyson, LL Flooring CEO and president. “We also continued to experience pressure from low brand awareness as we continue on our transition to LL Flooring.”
(Editor's note: Two years ago, LL Flooring began transitioning away from its former Lumber Liquidators brand.)
“As we look to the second half of 2023, we expect the challenging macro environment to persist, continuing to limit sales visibility," Tyson added. "As a result, we will focus to operate the business with discipline from an expense and capital management standpoint, including further leveraging our inventory management practices to yield continued improvements in our overall working capital.”
Company Info: Read LL Flooring’s full second quarter 2023 financial report here.
