Leon's Furniture (LNF) Q4 2025 earnings summary

Executive summary

• Delivered strong operational and financial performance in 2025, with system-wide sales up 2.8% and normalized, adjusted, diluted EPS up 16.5%.

• Revenue for 2025 rose 3.0% to CAD 2.57 billion, driven by robust furniture and appliance sales.

• Increased quarterly dividend by 20% and approved a CAD 0.50 special dividend.

• Navigated a challenging retail environment with cautious, value-focused consumers, leveraging trust and service to gain market share.

• Furniture was the standout category, growing 6.3% year-over-year, supported by focused assortment and inventory strategies.

Financial highlights

• Full-year revenue reached CAD 2.57 billion, up 3% year-over-year.

• Gross margin expanded 65 basis points to 45.04% for the year; Q4 gross margin was 46.08%, up 23 basis points.

• Net income was CAD 157 million, or CAD 2.29 per diluted share; adjusted net income increased by 16.6%.

• Adjusted EBITDA for 2025 was CAD 330.6 million, up from CAD 298.4 million in 2024.

• Ended the year with CAD 603 million in unrestricted liquidity.

Outlook and guidance

• Expect some Q4 2025 headwinds to carry into early 2026, including cautious consumer behavior and increased promotional intensity.

• Maintenance CapEx for 2026 projected at CAD 45–50 million, higher than historical range due to increased renovations and refreshes.

• Plan to open two new corporate stores and up to five franchise locations in 2026, weighted to the back half of the year.

• Remain focused on growing market share in core categories and expanding warranty, insurance, and service businesses.

• Management expresses confidence in delivering long-term shareholder returns, supported by a strong balance sheet.