La-Z-Boy (LZB) Q4 2024 earnings summary

Executive summary

• Fiscal Q4 sales were $554 million, down 1% year-over-year but up 22% from pre-pandemic Q4; full-year sales were just over $2 billion, roughly flat year-over-year when adjusting for backlog, but $2.05 billion and down 13% year-over-year on a GAAP basis.

• Q4 non-GAAP operating margin was 9.4% and non-GAAP EPS was $0.95; Q4 GAAP diluted EPS was $0.91, up 15% year-over-year.

• Operating cash flow was $53 million in Q4 and $158 million for the year; ended year with $341 million in cash and no external debt.

• $85 million returned to shareholders in fiscal 2024 via dividends and share repurchases; dividend increased by 10% in Q3.

• Expanded company-owned store network, now representing over half of total locations, with continued progress on growth strategy.

Financial highlights

• Q4 consolidated sales decreased 1% year-over-year to $554 million, but up 22% from fiscal 2019 Q4.

• Q4 GAAP operating margin was 9.1% (down 50 bps YoY); non-GAAP margin 9.4% (down 40 bps YoY).

• Q4 GAAP net income was $39.3 million (up 14% YoY); non-GAAP net income was $40.8 million (down 5% YoY).

• Full-year non-GAAP operating income was $159 million, down 29% year-over-year; non-GAAP operating margin was 7.8%, down 170 basis points.

• Full-year non-GAAP gross margin increased by 210 basis points; SG&A expense dollars decreased 2% year-over-year.

Outlook and guidance

• Fiscal 2025 industry expected to decline up to 5%, with improvement likely late in the year as interest rates ease.

• Modest sales growth expected for fiscal 2025, with 12 to 15 new store openings planned, mostly in the second half.

• Q1 delivered sales expected between $475 million and $495 million; non-GAAP operating margin between 6% and 7%.

• Capital expenditures for fiscal 2025 projected at $70–$80 million; continued share repurchases at pre-COVID levels.