Profits plunge as sales fade at LL Flooring

LL Flooring reported second quarter slipped 0.8% to $299 million from second quarter 2021 sales of $301 million.

The specialty flooring retailer’s comparable store sales decreased 3.1% from the second quarter of 2021, but increased 28.2% on a two-year stack basis and 6.9% on a three-year stack basis.

During the second quarter of 2022, the Richmond, Va.-based company opened six new stores, bringing its total store count to 437 as of June 30.

But the company’s net income for the period plummeted to $2.7 million from a second-quarter 2021 net income of $12 million.

Looking ahead, LL Flooring said that it expects higher transportation and material costs will be a headwind to gross margins in 2022. The company also said it expects to continue to partially offset higher costs through pricing, promotion, and sourcing strategies but will monitor the market to inform and guide its decisions.

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The Bottom Line: As sales slip by $2.4 million to $299 million, profits plunge 344% to $2.7 million.

What the CEO said:  “During the second quarter, our teams delivered our fifth consecutive quarter of double-digit year-over-year growth in sales to Pro customers, opened six new stores and rebuilt our inventory levels,” said Charles Tyson, president and CEO of Lumber Liquidators.

“The year-over-year decrease in comparable store sales reflected continued lower spending by consumers versus last year, which we believe reflected pressure from inflation and higher interest rates, and their preference to spend more on travel and entertainment. We reported operating margin of 1.6% and adjusted operating margin of 2%, as we continued to invest in our long-term growth strategies and navigate gross margin headwinds,” Tyson added.

Company info: Click here to read the full second quarter 2022 financial report from LL Flooring.