Flexsteel Industries (FLXS) 10-Q 6 Feb 19 2019 Q2 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	6 Months Ended
	Dec. 31, 2018	Jan. 20, 2019
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Dec. 31, 2018
Document Fiscal Year Focus	2,019
Document Fiscal Period Focus	Q2
Entity Registrant Name	FLEXSTEEL INDUSTRIES INC
Entity Central Index Key	37,472
Current Fiscal Year End Date	--06-30
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		7,890,202
Entity Emerging Growth Company	false
Entity Small Business	false
Trading Symbol	FLXS

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2018	Jun. 30, 2018
ASSETS
Cash and cash equivalents	$ 25,581	$ 27,750
Investments	7,985	15,951
Trade receivables - less allowances: December 31, 2018, $100; June 30, 2018, $1,100	42,685	41,253
Inventories	93,905	96,204
Other	10,419	8,476
Total current assets	180,575	189,634
NONCURRENT ASSETS:
Property, plant and equipment, net	102,614	90,725
Deferred income taxes	1,495	1,455
Other assets	2,406	2,479
TOTAL	287,090	284,293
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable - trade	18,978	17,228
Accrued liabilities:
Payroll and related items	5,340	5,459
Insurance	4,432	4,439
Accrued Advertising, Current	4,954	4,192
Accrued Environmental Loss Contingencies, Current	3,600	3,600
Other	6,362	6,011
Total current liabilities	43,666	40,929
LONG-TERM LIABILITIES:
Other liabilities	1,638	1,666
Total liabilities	45,304	42,595
SHAREHOLDERS' EQUITY:
Stockholders' Equity, Total	241,786	241,698
Common stock - $1 par value; authorized 15,000,000 shares; outstanding December 31, 2018, 7,888,702 shares; outstanding June 30, 2018, 7,868,298 shares	7,889	7,868
Additional paid-in capital	27,012	26,321
Retained earnings	208,945	209,553
Accumulated other comprehensive loss	(2,060)	(2,044)
TOTAL	$ 287,090	$ 284,293

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2018	Jun. 30, 2018
Consolidated Balance Sheets [Abstract]
Trade receivables, allowance for doubtful accounts	$ 100	$ 1,100
Common stock, par value	$ 1	$ 1
Common stock, authorized	15,000,000	15,000,000
Common stock, outstanding	7,888,702	7,868,298

Consolidated Statements Of Oper

Consolidated Statements Of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Consolidated Statements Of Operations [Abstract]
Revenue from Contract with Customer, Excluding Assessed Tax	$ 118,352	$ 129,392	$ 231,839	$ 249,226
Cost of Goods and Services Sold	(96,878)	(101,990)	(188,574)	(195,684)
Gross margin	21,474	27,402	43,265	53,542
Selling, general and administrative	(19,371)	(19,679)	(39,567)	(37,915)
Gain on sale of facility				1,835
Operating income (loss)	2,103	7,723	3,698	17,462
Interest and other income	58	158	239	299
Income before income taxes	2,161	7,881	3,937	17,761
Income tax provision	(595)	(1,660)	(1,075)	(5,360)
Net income (loss)	$ 1,566	$ 6,221	$ 2,862	$ 12,401
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
Basic	7,885	7,847	7,880	7,839
Diluted	7,917	7,937	7,922	7,931
EARNINGS (LOSS) PER SHARE OF COMMON STOCK:
Basic	$ 0.20	$ 0.79	$ 0.36	$ 1.58
Diluted	$ 0.20	$ 0.78	$ 0.36	$ 1.56

Consolidated Statements Of Comp

Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Accumulated Other Comprehensive Income (Loss) [Abstract]
Net income	$ 1,566	$ 6,221	$ 2,862	$ 12,401
Unrealized (losses) gains on securities	64	(59)	82	(84)
Reclassification of realized gain to other income	(107)	40	(103)	75
Other Comprehensive Income (Loss) Before Taxes	(43)	(19)	(21)	(9)
Income tax benefit (expense) related to securities gains (losses)	11	8	6	4
Other comprehensive (loss) income, net of tax	(32)	(11)	(15)	(5)
Comprehensive income	$ 1,534	$ 6,210	$ 2,847	$ 12,396

Consolidated Statements Of Cash

Consolidated Statements Of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
OPERATING ACTIVITIES:
Net income (loss)	$ 2,862	$ 12,401
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation	3,734	3,633
Deferred income taxes	(35)	720
Stock-based compensation expense	871	592
Provision for losses on accounts receivable	(86)	(75)
Gain on disposition of capital assets	(42)	(1,794)
Changes in operating assets and liabilities:
Trade receivables	(1,346)	(5,014)
Inventories	2,299	(10,827)
Other current assets	(1,980)	(391)
Other assets
Accounts payable - trade	3,590	1,584
Accrued liabilities	946	325
Other long-term liabilities	117	146
Net cash provided by operating activities	10,930	1,300
INVESTING ACTIVITIES:
Purchases of investments	(12,572)	(20,099)
Proceeds from sales of investments	20,515	18,045
Proceeds from sale of capital assets	42	6,152
Capital expenditures	(17,462)	(12,902)
Net cash (used in) provided by investing activities	(9,477)	(8,804)
FINANCING ACTIVITIES:
Dividends paid	(3,463)	(3,290)
Proceeds from issuance of common stock	52	51
Shares withheld for employee tax obligations	(211)	(552)
Net cash used in financing activities	(3,622)	(3,791)
Increase (decrease) in cash and cash equivalents	(2,169)	(11,295)
Cash and cash equivalents at beginning of year	27,750	28,874
Cash and cash equivalents at end of year	25,581	17,579
SUPPLEMENTAL INFORMATION CASH PAID DURING THE PERIOD FOR:
Income taxes paid (refunded)	1,430	5,050
Capital Expenditures Incurred but Not yet Paid	$ 2,244	$ 1,826

Accounting Developments

Accounting Developments	6 Months Ended
	Dec. 31, 2018
Accounting Developments [Abstract]
New Accounting Pronouncements and Changes in Accounting Principles [Text Block]	1. BASIS OF PRESENTATION – The consolidated financial statements included herein have been prepared by Flexsteel Industries, Inc. and Subsidiaries (the “Company” or “Flexsteel”), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The information furnished in the consolidated financial statements includes normal recurring adjustments and reflects all adjustments, which are, in the opinion of management, necessary for a fair presentation of such consolidated financial statements. Operating results for the three and six months ended December 31, 2018 are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2019. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with generally accepted accounting principles (“GAAP”) in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. Except to the extent updated or described below, the significant accounting policies set forth in Note 1 to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended June 30, 2018, appropriately represent, in all material respects, the current status of accounting policies and are incorporated by reference.  DESCRIPTION OF BUSINESS – Flexsteel Industries, Inc. and Subsidiaries (the “Company”) incorporated in 1929 is celebrating its 125th anniversary of the Company’s founding in 1893. Flexsteel Industries, Inc. is one of the oldest and largest manufacturers, importers and marketers of residential and contract upholstered and wooden furniture products in the United States. Over the generations the Company has built a committed retail and consumer following based on its patented, guaranteed-for-life Blue Steel Spring TM – the all-riveted, high-carbon, steel-banded seating platform that gives upholstered and leather furniture the strength and comfort to last a lifetime. With offerings for use in home, hotel, healthcare, recreational vehicle, marine and office, the Company distributes its furniture throughout the United States & Canada through the Company’s sales force and various independent representatives.  A DOPTED A CCOUNTING PRONOUNCEMENTS - In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (Topic 606), which provides a framework for the recognition of revenue, with the objective that recognized revenues properly reflect amounts an entity is entitled to receive in exchange for goods and services. The guidance is effective for annual reporting periods beginning after December 15, 2017, the Company’s fiscal year 2019. The guidance permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (modified retrospective method). The Company adopted the modified retrospective method on July 1, 2018. The adoption of this standard did not have a material impact on the Company’s consolidated financial statements as revenue is recognized when product ownership and risk of loss is transferred to the customer, collectability is probable and the Company has no remaining performance obligations. Thus, the timing of revenue recognition is not impacted by the new standard.  The Company’s revenues result from the sale of goods and reflect the consideration to which the Company expects to be entitled. The Company records revenue based on a five-step model in accordance with Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers ("ASC 606"). For its customer contracts, typically purchase orders, the Company identifies the performance obligations (goods), determines the transaction price, allocates the contract transaction price to the performance obligations, and recognizes the revenue when the performance obligation is transferred to the customer. A good is transferred when the customer obtains control of that good and risk of loss transfers at that point in time.  Provisions for customer volume rebates, product returns, discounts and allowances are variable consideration and are recorded as a reduction of revenue in the same period the related sales are recorded. Such provisions are calculated based upon agreed percentages. Consideration given to customers for cooperative advertising is recognized as a reduction of revenue except to the extent there is a distinct good or service and evidence of the fair value of the advertising, in which case the expense is classified as selling, general and administrative expense (SG&A).  The Company has a limited lifetime warranty on all products. The Company does not offer the option to purchase warranties. The Company accounts for warranties under ASC Subtopic 460, Guarantees , and not as variable consideration related to revenue.  Occasionally the Company receives deposits from customers before it has transferred control of the product to customers, resulting in contract liabilities. These contract liabilities are reported within “Accounts payable - trade” in the consolidated balance sheets. As of June 30, 2018, the Company had $2.2 million of customer deposits. As of December 31 , 2018, the Company had $1.9 million of customer deposits.  Upon adoption of ASC 606, the Company elected the following practical expedients and policy elections: · Costs for shipping and handling activities that occur before the customer obtains control of the product are accounted for as fulfillment activities. Accordingly, these expenses are recorded at the same time the Company recognizes revenue. · Incremental costs of obtaining a contract, specifically commissions, are recorded as an SG&A expense when incurred. · All taxes imposed on and concurrent with revenue-producing transactions and collected by the Company from a customer, including sales, use, excise, and franchise taxes are excluded from the measurement of the transaction price. These accounting treatments are consistent with the Company’s policies prior to adoption of ASC 606. Therefore, there will be no impact to the consolidated financial statements.  Adoption of this standard did not result in significant changes to the Company’s accounting policies, business processes, systems or controls, or have a material impact on financial position, results from operations and cash flows or related disclosures. As such, prior period financial statements were not adjusted.  The f ollowing table disaggregates the Company’s net sales by product cat egory for the quarter ended December 31 , (in millions):   2018 2017  Residential $ 99.4 $ 110.8  Contract 19.0 18.6  Total $ 118.4 $ 129.4 The f ollowing table disaggregates the Company’s net sales by product cat egory for the six months ended December 31 , (in millions):   2018 2017  Residential $ 195.4 $ 212.6  Contract 36.4 36.6  Total $ 231.8 $ 249.2  UNADOPTED ACCOUNTING PRONOUNCEMENTS – In February 2016, the FASB issued ASU 2016-02, Leases, which will require lessees to recognize most leases on their balance sheets related to the rights and obligations created by those leases and will expand disclosure requirements. The new guidance was issued to increase transparency and comparability among companies. In July 2018, the FASB approved an amendment to the new guidance that allows companies the option of using the effective date of the new standard as the initial application (at the beginning of the period in which is it adopted, rather than at the beginning of the earliest comparative period) and to recognize the effects of applying the new ASU as a cumulative effect adjustment to the opening balance sheet or retained earnings. Based on the effective dates, the Company expects to adopt the new guidance in the first quarter of fiscal 2020 using the new transition election to not restate comparative periods. The Company is still evaluating the impact to its consolidated financial statements and footnote disclosures. 

Inventories

Inventories	6 Months Ended
	Dec. 31, 2018
Inventories [Abstract]
Inventories	2. INVENTORIES  A comparison of inventories is as follows:    (in thousands) December 31, June 30,  2018 2018  Raw materials $ 13,615 $ 13,335  Work in process and finished parts 7,590 7,195  Finished goods 72,700 75,674  Total $ 93,905 $ 96,204 

Fair Value Measurements

Fair Value Measurements	6 Months Ended
	Dec. 31, 2018
Fair Value Measurements [Abstract]
Fair Value Disclosures [Text Block]	5. FAIR VALUE MEASUREMENTS  The Company’s cash and cash equivalents , investments, accounts receivable, other current assets, accounts payable and certain accrued liabilities are carried at amounts which reasonably approximate their fair value due to their short-term nature. G AAP on fair value measurement for certain financial assets and liabilities require that each asset and liability carried at fair value be classified into one of the following categories: Level 1: Quoted market prices in active markets for identical assets and liabilities; Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data; or Level 3: Unobservable inputs that are n ot corroborated by market data. The Company has not changed its valuation techniques in measuring the fair value of any financial assets and liabilities during the period.  The Company purchases available-for-sale securities, U.S. Treasury bills and U.S. Agencies, which are recorded at fair market value. These securities are classified as “Investments” in the consolidated balance sheets. Unrealized gains or losses are recorded in “Accumulated other comprehensive loss” in the consolidated balance sheets. As of December 31, 2018 , the fair market value and book value of the investments are $8.0 million. As of June 30, 2018, the fair market value and book value of the investments were $16.0 million. These assets are classified as Level 1 in accordance with fair value measurements described above.

Credit Arrangements

Credit Arrangements	6 Months Ended
	Dec. 31, 2018
Credit Arrangements [Abstract]
Credit Arrangements	 4. CREDIT ARRANGEMENTS  The Company maintain s a n unsecured credit agreement that provide s short-term working capital financing up to $ 10.0 million with interest of LIBOR plus 1% ( 4.50% at December 31, 2018 ), including up to $ 4.0 million of letters of credit. Letters of credit outstanding at December 31, 2018 totaled $1.3 million . Other than the outstanding letters of credit, the Company did not utilize borrowing availability under the credit facility, leaving borrowing availability of $8.7 million as of December 31, 2018 . The credit agreement expire s June 30 , 201 9 . At December 31, 2018 , the Company was in compliance with all of the financial covenants co ntained in the credit agreement .  The Company maintains an additional unsecured $10.0 million line of credit, with interest at prime minus 2% ( 3.5% at December 31, 2018 ) . No amount was outstanding on the line of credit at December 31, 2018 . This line of credit matures December 31, 2019.

Income Taxes

Income Taxes	6 Months Ended
	Dec. 31, 2018
Income Taxes [Abstract]
Income Taxes	5. INCOME TAXES  On December 22, 2017, the Tax Cuts and Jobs Act (“Tax Reform”), was enacted, which, among numerous provisions reduced the federal statutory corporate tax rate from 35% to 21% . Based on the provisions of the Tax Reform, the Company remeasured its deferred tax assets and liabilities and adjusted its estimated annual federal income tax rate to incorporate the lower corporate tax rate into the tax provision.  During the quarters ended December 31, 2018 and 2017, the effective tax rates were 27.5% and 21.1% , respectfully. The prior year quarter was positively impacted by a one-time adjustment for the passage of the Tax Reform. During the six months ended December 31, 2018 and 2017, the effective tax rates were 27.3% and 30.2% , respectively. 

Stock-Based Compensation

Stock-Based Compensation	6 Months Ended
	Dec. 31, 2018
Stock-Based Compensation [Abstract]
Stock-Based Compensation	5. STOCK-BASED COMPENSATION  The Company has two stock-based compensation methods available when determining employee compensation.  (1) Long-Term Incentive Compensation Plans  Long-Term Incentive Compensation Plan  The Long-Term Incentive Compensation Plan provides for shares of common stock to be awarded to officers and key employees based on performance targets set by the Compensation Committee of the Board of Directors (the “Committee”). T he Company’s shareholders previously approved 700,000 shares to be issued under the plan. As of December 31, 2018 , 102,183 shares have been issued. The C ommittee selected fully-diluted earnings per share as the performance goal for the three-year performance period s July 1, 2016 – June 30, 2019 (2017-2019) and July 1, 2017 – June 30, 2020 (2018-2020), and July 1, 2018 – June 30, 2021 (2019-2021) . The Committee also selected total shareholder return as a performance goal for the executive officers for the three-year performance periods 2017-2019, 2018-2020 and 2019-2021. Stock awards will be issued to participants as soon as practicable following the end of the performance periods subject to verification of results and C ommittee approval. The compensation cost related to the number of shares to be granted under each performance period is fixed on the grant date, which is the date the performance period begins.  During the quarters and six months ended December 31, 2018 and 2017, the Company recorded no plan expense. If the target performance goals for 2017-2019 , 2018-2020 and 2019-2021 plans would be achieved, the total amount of compensation cost recognized over the requisite performance periods would be $0.9 million , $0.6 million and $0.4 million, respectively.  (2) Stock Plans  Omnibus Stock Plan  The Omnibus Stock Plan is for key employees, officers and directors and provides for the granting of incentive and nonqualified stock options, restricted stock, restricted stock units, stock appreciation rights and perfor mance units. T he Company’s shareholders previously approved 700,000 shares to be issued under the plan.  Under the Omnibus Stock Plan, options are granted at an exercise price equal to the fair market value of the underlying common stock at the date of grant and exercisable for up to 10 years. It is the Company’s policy to issue new shares upon exercise of stock options. The Company accepts shares of the Company’s common stock as payment for the exercise price of options. Shares received as payment are retired upon receipt. During the quarter ended December 31, 2018, the Company issued options for 30,210 common shares and recorded expense of $0.1 million related to stock option grants. The Company did not issue options or record expense for the quarter ended December 31, 2017 .  During the six months ended December 31, 2018 and 2017, the Company issued options for 66,305 and 21,439 common shares and recorded expense of $0.4 million and $0.2 million related to stock option grants, respectively.  Under the Omnibus Stock Plan, the Company issued 3,675 and 1,701 shares to non-executive directors as compensation and recorded expense of $0.1 million during the quarters ended December 31, 2018 and 2017, respectively . The Company issued 6,265 and 3,564 shares to non-executive directors as compensation and recorded expense of $0.2 million during the six months ended December 31, 2018 and 2017, respectively.  During the three and six months ended December 31, 2018, the Company recorded $0.1 million and $0.3 million compensation expense for grants of an aggregate 39,666 restricted stock units under the plan to four executive officers as per their notification of award letters dated July 1, 2018. In addition, the Company awarded 30,000 restricted stock units and 3,186 restricted stock shares to its Chief Executive Officer per notification of award letters dated December 28, 2018. During the three and six months ended December 31, 2017, the Company recorded $0.1 million and $0.2 million compensation expense for grants of an aggregate 6,280 restricted stock units under the plan to two executive officers as per their notification of award letters dated July 1, 2017.  At December 31, 2018, 406,152 shares were available for future grants under the plan .  2006 and 2009 Stock Option Plans  The 2006 and 2009 S tock O ption Plans a re for key employees, off icers and directors and provide for granting incentive and nonqualified stock options. Under the plans, options were granted at an exercise price equal to the fair market value of the underlying common stock at the date of grant and exercisable for up to 10 years. All option s were exercisable when granted. No additional o ptions can be granted under the 2006 and 2009 Stock Option P lans.  (3) Outside a Plan  During the quarter ended December 31, 2018, the Company awarded its Chief Executive Officer 55,000 options outside any Company stock plan. The Company recorded no compensation expense related to this grant during the quarter and six months ended December 31, 2018.  (4) Summary  A summary of the status of the Company’s stock plans as of December 31, 2018 , June 30, 2018 and 201 7 and the changes during the periods then ended is presented below:     Weighted Aggregate  Shares Average Intrinsic Value  (in thousands) Exercise Price (in thousands)  Outstanding and exercisable at June 30, 2017 187 $ 27.21 $ 5,039  Granted 21 45.21  Exercised (21) 18.89  Canceled (21) 26.77  Outstanding and exercisable at June 30, 2018 166 $ 30.65 $ 1,841  Granted 66 27.87  Exercised (4) 13.81  Canceled (7) 36.58  Outstanding and exercisable at December 31, 2018 221 $ 29.90 $ 246  The following table summarizes information for options outstanding and exercisable at December 31, 2018 :     Options  Outstanding and Weighted Average  Range of Exercisable Remaining Exercise  Prices (in thousands) Life (Years) Price  $ 8.55 - 13.90 14 2.2 $ 11.91  17.23 - 19.77 26 3.3 18.88  20.50 - 27.57 66 7.0 23.91  31.06 - 32.80 64 8.0 32.30  43.09 - 47.45 51 7.7 45.37  $ 8.55 - 47.45 221 6.7 $ 29.90 

Earnings Per Share

Earnings Per Share	6 Months Ended
	Dec. 31, 2018
Earnings Per Share [Abstract]
Earnings Per Share	6. EARNINGS PER SHARE  Basic earnings per share (EPS) of common stock are based on the weighted-average number of common shares outstanding during each period. Diluted e arnings pe r share of common stock include the dilutive effect of potential common shares outstanding. The Company’s potential common shares outstanding are stock options , shares associated with the Long-Term Incentive Compensation P lan and non-vested shares . The Company calculates the dilutive effect of outstanding options using the treasury stock method. Anti-dilutive shares are not included in the computation of diluted EPS when their exercise price is greater than the average closing market price of the common shares. The Company calculates the dilutive effect of shares rel ated to the Long-Term Incentive Compensation P lan and non-vested shares based on the number of shares, if any, that would be issuable if the end of the fiscal period were the end of the contingency period.  In computing EPS for the three months ended December 31, 2018 and 201 7 , net income as reported for each respective period is divide d by the fully diluted weighted- average number of shares outstanding:     Three Months Ended Six Months Ended  December 31, December 31,  (in thousands) 2018 2017 2018 2017   Basic shares 7,885 7,847 7,880 7,839   Potential common shares:  Stock options 20 73 33 75  Long-term incentive plan - 14 - 15  Non-vested shares 12 3 9 2  32 90 42 92   Diluted shares 7,917 7,937 7,922 7,931   Anti-dilutive shares 141 - 115 -   Cash dividends declared per common share were $0.22 and $0.44 for the quarters and six months ended December 31, 2018 and 2017.

Litigation

Litigation	6 Months Ended
	Dec. 31, 2018
Litigation [Abstract]
Litigation	7. LITIGATION Environmental Matters – I n March 2016, the Company received a General Notice Letter for the Lane Street Groundwater Superfund Site (the “Lane Street Site”) located in Elkhart, Indiana from the U . S . Environmental Protection Agency (EPA). In April 2016, the EPA issued their proposed clean-up plan for groundwater pollution and request for public comment. The Company responded to the request for public comment in May 2016. The EPA issued a Record of Decision selecting a remedy in August 2016 and estimated total costs to remediate of $3.6 million. In July 2017 , the EPA issued a Special Notice L etter to the Company demanding that the Company perform the remedy selected and pay for the remediation cost and past response costs of $5.5 million. On October 12, 2017, the Company, after consultation with its insurance carriers, offered an amount, fully reimbursable by insurance coverage, to the EPA to resolve this matter. On November 6, 2017, the settlement offer extended on October 12, 2017 was rejected.  In April 2018, the EPA issued a Unilateral Administrative Order for Remedial Design and Remedial Action (the “Order”) against the Company. The Order was issued under Section 106(a) of the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), 42 U.S.C. §9606(a). The Order directs the Company to perform remedial design and remedial action for the Lane Street Site. The Order was to be effective May 29, 2018. To ensure completion of the remediat ion work, the EPA required the Company to secure financial assurance in the initial amount of $3.6 million, which as noted above, is the estimated cost of remedial work. The Company believes that financial assurance is not required because it meets the relevant financial test criteria as provided in the Order. In May 2018, the EPA agreed to suspend enforcement of the Order so that the Company could conduct environmental testing upgradient to its former manufacturing location pursuant to an Administrative Order on Consent (AOC). On July 5, 2018, the EPA proposed a draft AOC, to which the Company provided revisions. During the latter part of 2018 , Flexsteel submitted to the EPA its proposed work plan for the upgradient testing to be conducted pursuant to the draft AOC. The EPA provided comments on that documentation on December 4, 2018. On January 23, 2019, Flexsteel submitted responses to the EPA’s comments and revised work plan documents. As of January 25, 2019, the Company has not finalized the AOC with the EPA. The Company reflected a $3.6 million liability in the consolidated financial results for the fiscal year ended June 30, 2018. Despite the Company’s position that it did not cause nor contribute to the contamination , the Company continues to reflect this liability in the consolidated financials for the quarter and six months ended December 31 , 2018 in accordance with FASB issued Asset Retirement and Environmental Obligations (ASC 410-30) . The Company continues to evaluate the Order, its legal options and insurance coverages to assert its defense and recovery of current and future expenses related to this matter.  Other Proceedings – From time to time, the Company is subject to various other legal proceedings, including lawsuits, which arise out of, and are incidental to, the conduct of the Company’s business. The Company does not consider any of such other proceedings that are currently pending, individually or in the aggregate, to be material to its business or likely to result in a material effect on its consolidated operating results, fina ncial condition, or cash flows.

Subsequent Event

Subsequent Event	3 Months Ended
	Sep. 30, 2018
Subsequent Events [Abstract]
Subsequent Event	As of January 25, 2019 , there were no subsequent events , other than the items mentioned in Note 8 .

Accounting Pronouncement Rev Re

Accounting Pronouncement Rev Rec (Tables)	3 Months Ended	6 Months Ended
	Dec. 31, 2018	Dec. 31, 2018
Revenue from Contract with Customer [Abstract]
Disaggregation of Revenue [Table Text Block]	 2018 2017  Residential $ 99.4 $ 110.8  Contract 19.0 18.6  Total $ 118.4 $ 129.4 	 2018 2017  Residential $ 195.4 $ 212.6  Contract 36.4 36.6  Total $ 231.8 $ 249.2 

Inventories (Tables)

Inventories (Tables)	6 Months Ended
	Dec. 31, 2018
Inventories [Abstract]
Comparison Of Inventories	   (in thousands) December 31, June 30,  2018 2018  Raw materials $ 13,615 $ 13,335  Work in process and finished parts 7,590 7,195  Finished goods 72,700 75,674  Total $ 93,905 $ 96,204 

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	6 Months Ended
	Dec. 31, 2018
Stock-Based Compensation [Abstract]
Schedule Of Stock Option Plans	   Weighted Aggregate  Shares Average Intrinsic Value  (in thousands) Exercise Price (in thousands)  Outstanding and exercisable at June 30, 2017 187 $ 27.21 $ 5,039  Granted 21 45.21  Exercised (21) 18.89  Canceled (21) 26.77  Outstanding and exercisable at June 30, 2018 166 $ 30.65 $ 1,841  Granted 66 27.87  Exercised (4) 13.81  Canceled (7) 36.58  Outstanding and exercisable at December 31, 2018 221 $ 29.90 $ 246 

Earnings Per Share (Tables)

Earnings Per Share (Tables)	6 Months Ended
	Dec. 31, 2018
Earnings Per Share [Abstract]
Schedule of Earnings Per Share, Basic and Diluted	   Three Months Ended Six Months Ended  December 31, December 31,  (in thousands) 2018 2017 2018 2017   Basic shares 7,885 7,847 7,880 7,839   Potential common shares:  Stock options 20 73 33 75  Long-term incentive plan - 14 - 15  Non-vested shares 12 3 9 2  32 90 42 92   Diluted shares 7,917 7,937 7,922 7,931   Anti-dilutive shares 141 - 115 - 

Accounting Pronouncement Rev _2

Accounting Pronouncement Rev Rec (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Jun. 30, 2018
Revenue from Contract with Customer, Excluding Assessed Tax	$ 118,352	$ 129,392	$ 231,839	$ 249,226
Contract with Customer, Liability	1,900		1,900		$ 2,200
Residential [Member]
Revenue from Contract with Customer, Excluding Assessed Tax	99,400	110,800	195,400	212,600
Contract[Member]
Revenue from Contract with Customer, Excluding Assessed Tax	$ 19,000	$ 18,600	$ 36,400	$ 36,600

Inventories (Details)

Inventories (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Jun. 30, 2018
Inventories [Abstract]
Total inventories	$ 93,905	$ 96,204
Raw materials, net of reserves	13,615	13,335
Work in process and finished parts, net of reserves	7,590	7,195
Finished goods, net of reserves	$ 72,700	$ 75,674

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Jun. 30, 2018
Fair Value Measurements [Abstract]
Investments	$ 7,985	$ 15,951

Credit Arrangements (Details)

Credit Arrangements (Details) $ in Millions	6 Months Ended
	Dec. 31, 2018USD ($)
Line of Credit Facility [Line Items]
Credit agreement capacity	$ 10
Interest rate over LIBOR	1.00%
Libor Plus 1 [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Interest Rate, Effective Percentage	4.50%
Prime Minus 2 [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Interest Rate, Effective Percentage	3.50%
Letter Of Credit [Member]
Line of Credit Facility [Line Items]
Credit agreement capacity	$ 4
Line of Credit Facility, Amount Outstanding	1.3
Line of Credit Facility, Remaining Borrowing Capacity	8.7
Unsecured [Member]
Line of Credit Facility [Line Items]
Credit agreement capacity	$ 10
Interest rate under prime rate	2.00%

Stock-Based Compensation (Narra

Stock-Based Compensation (Narrative) (Details) - USD ($)	3 Months Ended		6 Months Ended		18 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation cost	$ 0
Chief Executive Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted Stock Unit			$ 30,000
Options issued under stock option plans	55,000
Stock Option Plans [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Period options are excercisable			10 years
Shares available for future grants	0		0		0
New Long-Term Management Incentive Compensation Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares approved to be issued under plan	700,000		700,000		700,000
Shares issued			102,183
Compensation cost	$ 0	$ 0	$ 0	$ 0
New Long-Term Management Incentive Compensation Plan [Member] | 2017-2019 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation cost			900,000
New Long-Term Management Incentive Compensation Plan [Member] | 2018-2020 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation cost			600,000
New Long-Term Management Incentive Compensation Plan [Member] | 2019-2021Member
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation cost			$ 400,000
New Omnibus Stock Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares approved to be issued under plan	700,000		700,000		700,000
Compensation cost	$ 100,000		$ 400,000	$ 200,000
Period options are excercisable			10 years
Options issued under stock option plans	30,210		66,305	21,439
Shares available for future grants	406,152		406,152		406,152
New Omnibus Stock Plan [Member] | Director [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued	3,675	1,701	6,265	3,564
Compensation cost	$ 100,000	$ 100,000			$ 200,000
New Omnibus Stock Plan [Member] | Executive Officer [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares issued				6,280
Compensation cost	$ 100,000		$ 300,000
Restricted Stock Unit		$ 100,000	$ 39,666	$ 200,000

Stock-Based Compensation (Sched

Stock-Based Compensation (Schedule Of Stock Option Plans) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	6 Months Ended	12 Months Ended
	Dec. 31, 2018	Jun. 30, 2018	Jun. 30, 2017
Stock-Based Compensation [Abstract]
Shares, Outstanding and exercisable	166	187
Shares, Granted	66	21
Shares, Exercised	(4)	(21)
Shares, Canceled	(7)	(21)
Shares, Outstanding and exercisable	221	166
Weighted Average Exercise Price, Oustanding and exercisable	$ 30.65	$ 27.21
Weighted Average Exercise Price, Granted	27.87	45.21
Weighted Average Exercise Price, Exercised	13.81	18.89
Weighted Average Exercise Price, Canceled	36.58	26.77
Weighted Average Exercise Price, Oustanding and exercisable	$ 29.90	$ 30.65
Aggregate Intrinsic Value	$ 246	$ 1,841	$ 5,039

Stock-Based Compensation (Sch_2

Stock-Based Compensation (Schedule Of Options Outstanding And Exercisable) (Details) shares in Thousands	6 Months Ended
	Dec. 31, 2018$ / sharesshares
8.55 - 13.90 [Member]
Share-Based Compensation, Shares Authorized Under Stock Option Plans, Exercise Price Range [Line Items]
Range of Price Lower	$ 8.55
Range of Price Upper	$ 13.90
Options Outstanding | shares	14
Weighted Average Remaining Life, Years	2 years 2 months 12 days
Weighted Average Exercise Price	$ 11.91
17.23 - 19.77 [Member]
Share-Based Compensation, Shares Authorized Under Stock Option Plans, Exercise Price Range [Line Items]
Range of Price Lower	17.23
Range of Price Upper	$ 19.77
Options Outstanding | shares	26
Weighted Average Remaining Life, Years	3 years 3 months 18 days
Weighted Average Exercise Price	$ 18.88
20.50 - 27.57 [Member]
Share-Based Compensation, Shares Authorized Under Stock Option Plans, Exercise Price Range [Line Items]
Range of Price Lower	20.50
Range of Price Upper	$ 27.57
Options Outstanding | shares	66
Weighted Average Remaining Life, Years	7 years
Weighted Average Exercise Price	$ 23.91
31.06 - 32.80 [Member]
Share-Based Compensation, Shares Authorized Under Stock Option Plans, Exercise Price Range [Line Items]
Range of Price Lower	31.06
Range of Price Upper	$ 32.80
Options Outstanding | shares	64
Weighted Average Remaining Life, Years	8 years
Weighted Average Exercise Price	$ 32.30
43.09 - 47.45 [Member]
Share-Based Compensation, Shares Authorized Under Stock Option Plans, Exercise Price Range [Line Items]
Range of Price Lower	43.09
Range of Price Upper	$ 47.45
Options Outstanding | shares	51
Weighted Average Remaining Life, Years	7 years 8 months 12 days
Weighted Average Exercise Price	$ 45.37
8.55 - 47.45 [Member]
Share-Based Compensation, Shares Authorized Under Stock Option Plans, Exercise Price Range [Line Items]
Range of Price Lower	8.55
Range of Price Upper	$ 47.45
Options Outstanding | shares	221
Weighted Average Remaining Life, Years	6 years 8 months 12 days
Weighted Average Exercise Price	$ 29.90

Income Taxes (Reconciliation Be

Income Taxes (Reconciliation Between The U.S. Federal Statutory Tax Rate And The Effective Tax Rate) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 21, 2017
Income Taxes [Abstract]
Federal statutory tax rate			21.00%		35.00%
Effective tax rate	27.50%	21.10%	27.30%	30.20%
Income Tax Expense (Benefit)	$ 595	$ 1,660	$ 1,075	$ 5,360

Income Taxes (Primary Component

Income Taxes (Primary Components Of Deferred Tax Assets And (Liabilities)) (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Jun. 30, 2018
Income Taxes [Abstract]
Long-term	$ 1,495	$ 1,455

Litigation (Details)

Litigation (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Jun. 30, 2018	Jul. 31, 2017	Aug. 31, 2016
Litigation [Abstract]
Loss Contingency, Estimate of Possible Loss			$ 5,500	$ 3,600
Accrued Environmental Loss Contingencies, Current	$ 3,600	$ 3,600

Earnings Per Share (Details)

Earnings Per Share (Details) - $ / shares shares in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Earnings Per Share [Abstract]
Basic	7,885	7,847	7,880	7,839
Stock options	20	73	33	75
Long-term incentive plan		14		15
Restricted shares	12	3	9	2
Potential common shares, total	32	90	42	92
Diluted	7,917	7,937	7,922	7,931
Anti-dilutive shares	141		115
Dividends declared per common share	$ 0.22	$ 0.22	$ 0.44	$ 0.44