LZB - Earnings call transcript Q1 2021

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Operator

Thank you for holding, ladies and gentlemen. Good day and welcome to the La-Z-Boy Fiscal 2021 First Quarter Conference Call. All lines have been placed on a listen-only mode and the floor will be opened for questions and comments following the presentation. At this time, it is my pleasure to turn the floor over to your host for today, Ms. Kathy Liebmann. yours. is floor the Ma’am,

Kathy Liebmann

Chairman, Thank call you, joining quarter Thank for the through. begin Darrow, morning With Whittington, midway and CFO. financials Kurt Melinda and to discuss will good will La-Z-Boy’s Kurt us are first close this everyone. and our CEO us Melinda the you and morning Jess President and fiscal results. to XXXX speak

questions. our Slides may We link, will available this call this will call beginning then available you through open will afternoon. week presentation and replay be view will to them year a webcast the which and be X of X accompany for for telephone the

include like remind I Before we some presentation, begin La-Z-Boy’s you to the future performance. statements forward-looking about today’s statements would call that made in

the News page our of tab will Chairman, over of end La-Z-Boy’s President and deck. that, on & the call With statements XX-K. encourage Although our of included that risk significant be reconciliations as described which the Investor Officer. in SEC Report we The as detailed factors actual I Darrow, our release our Kurt? future certain turn appendix it are filings. other Relations reasonable, includes is are review factors materially. differ well and key results measures, Kurt the at earnings in results Events We website these information Annual non-GAAP to you call Form believe to could those also most under risk an could available Chief as Also, Executive our our to affect our on conference

Kurt Darrow

Kathy and you, good Thank everyone. morning

XXXX market, results. we quarter Following yesterday’s first of our reported fiscal close

in plant with business ramp-up let and the timeline La-Z-Boy. me in you quarter are we for the progressing strong trends. of closures remind the To how the subsequent and midst with COVID-XX retail pandemic, While order written pandemic-related still context, our put is of pleased the

order Furniture our some May, La-Z-Boy local of closed the including June the of furniture on in for essentially the March, delivered of closed to sale pandemic result we and off Galleries a order building tail of with flow had production stores, delivered end still retailers, our initially most because As throughout all delivering entry, and backlog, we guidelines. our with facility and due terms increased weeks depending in of from of were and as But we at April in Tijuana then When as the the written concert retailers a sale, for wait Relatedly, restarted recognized restarting month majority product the Joybird the reduced closed worked plants, in we and COVID-XX April about commented we of last and sales quarter. when to we we with lost June accordingly. capacity, pre-pandemic the May challenges our month expected in in later open the majority that lag of late our to the May restarted Mexico. X plants for

But our our the about and order is business given levels. across normal currently additional workers. the our double strong. of our time during of of lag real now are increase challenge weekly to The good hiring operating continued and prior quarter about trends at have are written We news demand is XX% at the rate running year strong production rate that

increases the business, in which and of June first network, cadence sales For written accounts XX.X% wholesale in in about May sales provide some same-store half And on for quarter. XX% by the of XX% written our additional month quarter, in was the decline July. XX% or perspective increased entire La-Z-Boy a Furniture same-store Gallery of the to and

production. sales revenue of expected orders cycle to increase written than up through to higher we matter our a production catching it’s moving deliver now continue So on as

discretionary activity transferred on to reopenings million. early too other a eventually tell operating limits $XXX rotation million whether their decline no GAAP to tail or both. travel related leisure a what’s bit non-GAAP to versus consumer These it’s declining of off closures or environment it’s which for and ago probably shifting in of the the COVID-XX demand, related sector million to certain to with will sales income a operating and quarter, and XX% written strong income pent driving spending for up with year sales, to $X $X homes Now, an

the will however operating period and segment a million, and are deposits ended case remains million On was decline with were generate production the in we XX% partially balance still did to are $XXX brand. are still but increased responsibility, quarter temporary season. the spots and beginning we offset fall strong. with spring, The we margin sales be the of start is frequent sheet however both Life very soft remarks. for stronger reduction and frequent – month to the operating focuses fixed featuring second furnishings on of XX% one respectively. our what non-GAAP are as goods. Comfortably of time, that This move we our of actions includes for and more campaign TV costs investments able the sale by wholesale a by and non-GAAP the my fiscal in now lower March. design in supported we of to our mindful COVID-XX customization managing more with consequent this which rotation interest unusual announced XX% – a customer wholesale Bell. of related more in X.X% unpredictable launch the adjustments and up for home the pillars by a the with and We the this same into decline we Throughout a our cover result planning will in typically absorption wave our cash of strong increases which décor wave to capabilities, partially period, for offset marketing June of power Kristen $XXX the were the the decline upholstery principally of May both Melinda of and plan, Live the we and selling La-Z-Boy’s her brand action remarks I segment, will and of our than July Written quarter, numbers remainder at cost detail In in X.X% non-GAAP our the in

to integration wireless remote invest an option our website to continue consumers capabilities perspective, our we stores. our on providing increase our sectionals and continue in From our demand. high power between focus our offering a Additionally, hand in experience as we virtual omni-channel seamless and and product on be modulars, products

continue to people all unexpected the side, surge, we the hire to demand COVID-related On protocols. train and manufacturing safety meet following while

the the let and closed segment. XX% June. with company-owned increased Now, the of some me month, up quarter, on July how same-store even sales quarter for stores Written retail out majority to perspective June in down for respectively. XX% for same-store still month company-owned of May for stores a turn in played the May, the written the XX% in sales but for Again, were and and by XX% stores closed

our a margin to unexpected million declined momentum XX% X.X% delivered primarily enough for fast in inability the demand. quarter, to to of segment non-GAAP operating and loss our $XX increase sales meet the the was due production to For

high contributing has has As a become the we greatly been the retail the a several value and very at core discussed over company La-Z-Boy competency the performing level, of have last our business enterprise. to for quarters,

decline store The traffic, on in shopping execute and delivered anomaly we Encouragingly, close research average ticket the first the store stores at improvement their continued our of high sales. used given our consumers as before written teams our in very level to an to website quarter delayed and impact a conduct temporary a loss was dynamic conversion closures of saw and and sales. to

team been guests members to from will very customers shopping teams to traffic condition, enable store a are needs. of Additionally, June. wearing ability personal engage and store this July with Joybird. few book positive local positive and system, pleased our queuing after minutes now store appointments, in May spend declines capacity we These Feedback trends place new by safe a management in safe ordinance shop. healthy has were depending mask all on range creating to with deploying from on our experiences. we see In environment, and the to in terms and a shopping and and I ways

corporate declined to For other the XX% in reported and million. sales Joybird quarter, $XX.X

not However, basis. bottom line delivery Joybird loss the a fully part due written and plant XX%. later until reopening is year-over-year to growth reduced Balancing in sequential performance, sales The increased expected its catch sales the on quarterly operating June quarter and COVID-XX. to with to of Joybird third, the due second up into the

continue more to labor the to will things rate revenue demand o We now but quarter expect written to to anticipate I will be normal the to levels, two Melinda. it strong over due restored constraints. short-term turn delivered lag

Melinda Whittington

good Thank morning you, everyone. and Kurt

me present let and you remind always, trends. we GAAP presentation on both underlying non-GAAP as better non-GAAP believe we As reflects the basis a our that operating results

related diluted in facility excluded detailed first prior in the share. initiative, $X.X in $X.X global or of $X.X our appendix million year’s closure non-GAAP the periods share. per California of of the of first and realignment and a business results supply related included a workforce fiscal section and company’s quarter in related share quarter diluted the of to press chain tables $X.XX and call pre-tax or our conference a closure As $X.XX our charge charge from completed in release purchase $X.XX facility reporting excluded the Last our our million slides, accounting included XXXX Newton, per of Redlands, accounting pre-tax pre-tax or pre-tax Mississippi June, company’s a share a diluted per to announced diluted charge purchase to million manufacturing of per XX% our non-GAAP totaling which $X.XX reduction $X.X or the which million charge are acquisitions optimization

former revision non-GAAP segment segment. results, financial and quarter. I on would we channels, comments Due upholstery to case to goods a point reporting wholesale to a our the out reporting will former structures the here this specifically now And with unless otherwise. stated newly similar beginning focus segments from combined aggregated customer the on my Additionally, form segment our to

and a Gross costs. impact March. margin diluted as consolidated X.X%. facility the Consolidated ‘XX with our versus benefited Consolidated on last as SG&A performance in associated California quarter margin year reflecting X.X% XX.X% first SG&A the income well year’s our versus actions, for Non-GAAP about EPS reflecting of $X.XX from basis, in actions non-GAAP million including fiscal first Partially pandemic. part gross gross the offsetting reduction Improved On the COVID-XX by rate closure of as in XXX ‘XX in a from points. cost basis COVID-XX basis, to declined year’s quarter relative was improved COVID-XX margin consolidated $XXX quarter a also temporary the XX Joybird. year’s driven quarter. cost percent temporary sales in operating points, tax first $X effective last noted primarily per decline increased taken versus Redlands, a to $X.XX was quarter. the quarter targeted were was expense current reductions share sales action plan margin was increase fixed first operating fiscal in GAAP continued non-GAAP the action of $XX sales at first versus for increased ago, As basis plan. quarter as million, million XX% the was our in XX% announced last our

to adjustments, due fiscal been first would rate primarily tax discrete from for have effective XX% Absent rate XX.X%. taxes. effective federal varies Our ‘XX state rate the quarter the tax statutory

For the discrete in be our estimate to absent range a of rate effective fiscal continue basis GAAP year XX% we on XX%. items, to will ‘XX, tax

$XX million including quarter in written $XXX the in March the first $XXX cash $XX the to to in million ended on activities year’s compared in operating deposits COVID-XX the at in of We generated orders increase cash, we response proactively in end back cash company’s enhance drawn with for credit in company’s million cash, million to quarter. Joybird. retail a last in cash facility liquidity million $XXX from quarter, the from customer including Turning in segment with

also $XX with last compared $XX We returns year. cash in to on held million enhance investments million

the performance to primarily we quarter, our original and the investments $XX our During retail drawn quarter, million during ongoing related against to $XX the Dayton business in million liquidity. invested and our repaid Also $XX credit in based we on equipment machinery facility of and capital upgrades manufacturing million stores. line

be to $XX the to expenditures in million expect million We range of for year. capital fiscal the $XX

to projects business our essential will stores. upholstery plant maintenance on conditions, improvements for spending largely already Although trends, be prioritize will our technology liquidity dependent economic the upgrades year recovery including continued several manufacturing underway, upgrades and spending and retail to facilities,

share near-term flexibility, eliminated effort our our provide to action plan part dividend financial opportunistic expected in and the an in for and June preserve cash temporarily repurchases. COVID-XX As of we suspended

to dividend prior to trends per that monitor yesterday share. announce our – are to are dividend to to Kurt, the before the time, Board We management purchase respect call me ongoing XX% an discretion to macroeconomic reinstate that on – There announce program. the elected may trends. pleased its regular for we quarterly the Directors to we let we of several announced ‘XX. we assessment resume items continue X.X paid to with shareholders is at dividend of have vigilant shares availability This to current as of uncertainty. repurchases business amount business $X.XX of million and share pandemic remain our a under pleased And evaluate and back based important finally, are fiscal Over continue will authorized turning also level highlight our on currently quarterly

$X.XX this due assembly First, charges of realignment, $X.XX adjustments included which recent year. we non-GAAP to business, risk. remain we of And exceed our to continues twist, return our or written is in we than we lower in with given range to in and cautious our current is largely rates. sales have XX% are our to and continued that margins pre-pandemic increasing the economic our be Newton global Further, originally manage be the note include was trends, years fiscal during made much demand these $X.XX tariffs estimated pre-tax in business And acquisitions progress charges structure of that the hire coming odd it exclusion if uncertainty the in for can the tariff our The to be benefits forecast. about completion provided not to make quarter workforce. we per how a period challenge sales for full $X.XX demand. at a the on total severance business on closure but but ongoing finally, for time will second pandemic our the the ability reduction pleased facilities, we accounting to reminder a than of on restarting won’t velocity, the in to X related QX cost rebates purchase to anticipate our of more future ability of aggressively manufacturing are in to-date, ‘XX the trends relative And renewed. adjustments will an of And share expected on support based slightly anticipated actions, pace, tariffs, which and across received lighter on dependent to to production at plant the the to sales end continue

X going the forward And most last for we his have years. in concluding So, back will expense that similar now to Kurt quarters remarks. to

Kurt Darrow

Melinda. you, Thank

category. order of written still retailers pent-up with discretionary the marketplace some some time and given period demand well in closed because into home the selling flex we our are us, the our cautious move season. Melinda optimism still as we mindful on are as But pandemic noted, to the upon is demand in workforce with a pleased believe are as we in as spending, money shift our more our long going we ability noted, trends is were fall As and into there

providing I how the move of service a fiscal manage tightly well company the quite pleased we faring great focused this confident will through business this uncertain customers stronger through we day-to-day, am and is crisis. we I other am with are company we the on our conservatism side maintaining it. as period. on And As to emerge

vast to vibrant continue to our instructions the getting our sheet will turn world queue. things deliver strength in Kathy? on provide and capitalize network, including We your brand, class well-known you will La-Z-Boy all our thank the and system, Furniture of to very our stakeholders. long-term trusted to I for into distribution now, store We value strong over the to much And La-Z-Boy Gallery Incorporated. balance chain interest Kathy for supply

Kathy Liebmann

Kurt. you, Thank

period. question-and-answer the begin will We

instructions queue. getting into review Now, for Jeff, the the please

Operator

Thank James. you. We ahead. question our [Operator go Please Raymond Griffin will with first take Bobby from Instructions]

Bobby Griffin

and is Thank everybody Good for you hope healthy. questions staying everybody. I safe morning, taking and my

Kurt Darrow

Good morning, Bobby.

Melinda Whittington

morning. Good

Bobby Griffin

I the capacity or talk – inside of the sure anything the else the XX% to back from So, quarter guess is I material or with just end it shortages issue limiting we raw happening XXX%? labor of mostly is capacity there inside Melinda, facilities about first, manufacturing back getting making towards the that is some that’s wanted correctly, to XXX% and it understand at the getting call on

Kurt Darrow

primarily it’s labor. Bobby,

a in We was May – people hiccups you came and have coming just not to in, wasn’t supplies hour raw an XX plants. – – to meaningful back you key you store have not and enthusiastically, think miles and – had you start unlike ago furloughed where from retail but restart long lot turn that the up a don’t up and sales about when they of materials or any X we go start May

And system have are constraint we of our with facilities. all can coming sure things is continue up production some just we issues and working but unemployment back. three and benefits constraint increase is and can our to as but train everybody that – been over our people of into a ramp There so find that time, making nature, we to of our at our bring lot we now we enhanced and

Melinda Whittington

tracing contact, people just exposed folks the appropriately sure There if been making that COVID-XX, distant, home. socially safe doing keeping we of people Bobby keeping keeping are and someone so appropriate has outside realities is of middle also in the

just folks time how from you throughout our as working our realities some well. given time focus can for on to safety this, many employees have us are on there So to

Bobby Griffin

the Melinda even the in that will environment And correct? when probably you is back get that limit this labor throughput

Melinda Whittington

I in To today. just you a if team of what have realities the their this fantastic sending been a able someone that have we of of had we And job some will with mean, done keep you do, home, we limiter feel a go – has to very, extent, to have our and – number do fairly limited we need to you they have people but the impact, managed really comes they bit to safe, until have solved. are other on pandemic be exposed

Kurt Darrow

solely But the is Bobby, range after to if industry And add expectation times reopen this this hard that even worse. in The a La-Z-Boy working out wide industry to real is problem. would the lead a it’s you I is a problem, up I lot are everyone’s catch demand demand. know exceeded do import with product, everyone. of everybody things for that not and probably The

is to meet this the we to are not challenge our So, and over going we do unique we us, time. glad best are have but to it

Bobby Griffin

of street quickly lead When agree, times… and well it I our the sense. came makes how look as That Yes you side on demand Kurt, of the think back. at I us the surprised all

Melinda Whittington

to them. are worst have There problems

Bobby Griffin

in strong range order growth into think whether will frame bit can the are normally have delivering High are am problems I little trying class things up you kind a I or or not where in to mind June, back to that or we X think Yes. XQ order XQ? times, guess from we July the us when shift remind it at week in and of lead more the we about X kind help me normal, When of that my now range week they look call XX XX – to growth are they to say. potential

Kurt Darrow

Good question.

to Joybird’s essentially real weeks. to upholstery advantages. times Bobby, little to than at now is X little orders able to is delivering a different group. La-Z-Boy which La-Z-Boy, in almost by little a quickly different, weeks and a everything hard stretched and right So, of but X we at XX our that strategic deliver custom out worked were our X strip England’s lead we one are different And

and – July. mirror were continuing doing. what nearly to we And order of in August it’s to double it’s trends So see the what are we used in

– some backlog have have will we So, a extended an we will for time.

Bobby Griffin

but, Okay, need … we

Kurt Darrow

positive the on every But units side single are week. we more making

Bobby Griffin

of detail. going in but kind trends while. experienced virus were uncertainty understand to help on capacity revenue back And It’s unemployment with news side of I lastly to the as Could you plant a a you an get Okay, think about right new industry guess being prior the that facility August the me, having there I the we the now that What last good out manufacturing I type of has high add and of for secular shift to things? still be environment of appreciate to if us and where do level consumer well. of have or that’s without for from peak spending a limitation? kind

Melinda Whittington

our our issue space is not facility, issue people. is Bobby or

about the we we are plants So, and in to but then right footage that’s how efficient those of the places consumers as really footage always standpoint. serve making fine case more been we continue and efficiently it’s square even the the from are sure transportation why that’s and get think to about, on and labor plants, square

Bobby Griffin

all managing Okay, the difficult appreciate very quarter. very helpful. details. Congrats a again I on

Kurt Darrow

Thank you.

Melinda Whittington

you. Thank

Operator

at next go KeyBanc Brad move Capital ahead. will Markets. Please We to Thomas

Brad Thomas

on Congrats follow-up some everybody. I wanted and Bobby’s the think here momentum on about execution in strong business to the questions time. morning, production. good a of about, Hi, how to the difficult just during

of But sales to I means are prior would be XX%, you levels, that you hire? last year way meet level was you Is the the in that productive, way think did the months year. And year? to you our people so down in you think expect, only of more year as operating you about mean find characterize capacity about to demand improve that, able you ahead it XX% to basically that that the how do right to it? what that right with in still now try XX% revenues qualified over rating, run are

Melinda Whittington

are pieces right, but of I put speaks the the fluidity situation. directionally couple you yes, just a to couple that I different of A – mean, have

focus weeks two now be that hiring of given XX% than continue in is at on today, are I week, there’s but general, always there. to trajectory from less we of sort We on will question the better than impact And are moving mark two noted as on the efficiencies we as ago we any weeks and up. COVID that earlier, that,

You are right, it of on for of that’s we of The going at I that how ago. would branded out much thing to year a some much division, XX% as about obviously is point ballpark our did manufacturing is are say play own only is is, La-Z-Boy number we today business. there’s our retail And coming how that through.

got business, our England have business. We the also case goods

sense are rough a ballparks. I how ramping demand as about to up think staying of we and and as of we So you stand – high. future. to is on But are the today, mean, how where yes, those with throughput give long as demand

but hiring We and are both macro factors increase there increase throughput internal against. own are factors the our and will to we to that try there are that continue then working

Brad Thomas

That’s Melinda. helpful,

all for it as month have provide but of the in so triangulate store GAAP spent August you – revenues you don’t this know in guidance of down And our being that, I the forecast, somewhere may would to us to be try XX%. neighborhood reasonable

production and today? happening what’s given with Just here productivity

Kurt Darrow

last again, COVID get time ability though, to want continue to hire. it’s and We one handicap our away we outbreak the don’t So above – I plan, far year’s and production are the obviously month not to plan our in fall. Brad, but in levels some at to that any

make prediction people are we on, overtime. our this takes for Now, the lot that’s incredibly are we working are but stay to that of the XX% are level working not balance things at of to go going And a year, They a continuing progress. hard. to

We take are to doing level. that demand, everything while before the get we is a we can but going to meet it

hard, given just we in handicap are all how improvement other that much to make it’s the so And involved month to circumstances equation. that month

Brad Thomas

so expectations am that your here, everyone’s in or it. trying doesn’t XX% flow Kurt. strong everyone helpful. to Got into It’s revenue given check return keep just trends. that upcoming I number quarter

Melinda Whittington

but servicing intention demand in our in that. now, it’s we right good realities on on are news certainly where is Again, That are balancing. there

Kurt Darrow

all we the written orders, Yes, delivered tomorrow. not will be

Brad Thomas

But So and me could, be? terms last answers in you to strong are any of you trends all how a I had I chance if have for the have analyze one I one how sustainable know am curious don’t on customers. who the might of, demand much tell these data pent and if are the were insights of up greatly tidbits had that customers are. in if share your delayed if would to February, you’re in you shopping And appreciated. been were back be or purchases and can stores just individuals the Any January or these that able new they

Kurt Darrow

they to sporting vacations there’s All point overall view out eat, Brad, to discretionary ability to events. let home. our see home, you on go time want granular give home, big more you has shift spending going by where of is shifts the to people, Home people money Depot the of one things, those and are going. going go me time They reinvest. at feel without of be people a of have too results spent the on lot can but been at the the without to other a go to And to to been travel,

some And tunnel, is medical sector to the believe until rotation at there’s with the cures medicine and light that, this main the pandemic. driver of help of or end so probably about we this the

the a the stay industry this could after industry, thought seasonality we closures that that prepared have historically never in But for decent but I other the In a that and – so, home level take now percentage higher taken their everybody think levels. furniture, would are is at the it, all but thought, paint year slower at nobody everybody probably all think, at improving we the do always income. to it demand the keep summer, never part is sales, climbing this what at the the everybody, capturing is you remind nobody level. look bounce have risk look out back to Right of is of it’s category will stuff. working everybody inventory to just you the and was these would so discretionary it, and category, we not of but that I

Melinda Whittington

spending store And of while I two. some on for a shop people lot to higher have were ready more was be of from evidence you Higher couldn’t store. we placed level think there closure. that of buy saw But a I demand so so and And near-term doubt, researching April, probably our no up orders some mean, buying, in online. or definitely people, this website when they folks there’s we into during month pent couldn’t they saw level time walked our even of they

that familiar. also trust now brands some early to it’s specific tell share and there to probably back but to the it a too indicates to do piece question consumer other La-Z-Boy in know, to uncertain level we really but safety The that right gain, of not early a is that they your is to indexing data consumer gets broadly very time

too this with if do see campaign, gain that. so product that but that And hopeful are early we overtime, our Bell some quality any it’s of share high has and tell to really our between to Kristen we will

Brad Thomas

Really you so both helpful. Thank much.

Kurt Darrow

Brad. you, Thank

Operator

Company. We Please next Anthony & Sidoti will to ahead. at Lebiedzinski go go

Anthony Lebiedzinski

Hi. is everyone well for and Good and everyone questions hope I the healthy. taking morning, thank you and

couple a So things. I wanted just of to follow-up

as the ticket. average as better you up Can level the you there? get Kurt, a understanding improvements of help was of us well conversion quarter think I mentioned that So in

Kurt Darrow

our on but desire that was to their year We it previous But July. beat didn’t side, the the data. than until was higher don’t home to improve the and share all people normal. traffic good, conversion it And given traffic

we And say of you So, able to less forget in two kind up can doing that. the more XX% with was equate traffic, were business June, the but to that version do be

Anthony Lebiedzinski

it. Got

Okay, so not was alright. number. And average exact that ticket are disclosing then but the you

Okay, it. got

Okay, alright.

So that’s fine.

capacity? to challenge get people, to or back far do XXX% will as do hiring pay you So additional have come to you or more capacity I overcome you mean, people think to challenge close to that as how the of that incentivize

Kurt Darrow

depend them would, could skilled options is do part number another other to some worker if type in to business on the time. workers be of our takes what stimulus caution package happens problem a we I the Well, of that lot of mindsets, Hiring getting them and a does what thing getting but efficient, everybody. just a one have there’s up and

there a time of hire is little fully capable we that we to have. are the lag bit time that expectations of meeting time So from the they the them

be is to a is there get every paying and looking And lot that. so just the supply to if best more angle. would chain do our we on was And people option able team at going

previous to So we the but can looking we at than decreasing. so are week problem little a is get our not make down problem try the flow that, everything down slowed time. week, we The is decreasing. this more over not every And hasn’t backlog order good

Anthony Lebiedzinski

as how will a Sure, understanding permanent better business can more SG&A okay. aggressive nature? cutting that will and in how back the pretty And much the back us much to, then How of expenses of are with expenses some of perhaps cuts back. give come Obviously, expenses. expense you are comes we come

Melinda Whittington

what We expense we ad more contraction commissions reduction forth, expect still long-term of in expense. our took have point, going selling XX% I SG&A downturn items you was some but across level including selling would business economic and to that the are when to across also the expect all was we an And to have XX% the at so obviously spend. June some right-size are are and for SG&A you of more and to workforce well, that so meant going

is there of within that. lot pieces moving a So

but are to certainly, expenses overtime item, business growing was lasting going longer grow to our with intended of XX% majority the other headcount So proportionally. our a be reduction

Anthony Lebiedzinski

thank well, and Alright, it. Got you best luck. of

Kurt Darrow

you, Thank Anthony.

Melinda Whittington

you. Thank

Operator

Instructions] [Operator next to of Reuben We will go ahead. The Company. go Benchmark Please Garner

Reuben Garner

morning, Good you. Thank everybody.

Kurt Darrow

Good Reuben. morning,

Reuben Garner

in single-family that trends in if of guys into have So, had seen. industry the that repeat call, you the but difficulties seen moving anything. flight, in bigger I the something some are an want in the the those if suburbs? that cities apologies La-Z-Boy folks out being markets, as thought you homes, suburban I always as stronger of opportunity have hit view is big call-outs, maybe is of Do the we technical geographical I I guess one I early to kind of construction home on

Kurt Darrow

in number like we Well, had of Downtown don’t a locations in not have always or suburbs. We we anything a represented. or cities the Manhattan higher the have LA in share are

had suburbs with been a COVID and area sales with our has in the on Obviously, going pick recovery And change. bit point as a downs the a then they behind or California it’s say southern strong we more some individual their just states, I up, have what’s little wave. and Northeast of were but have always an Texas, So, that to would use as started for you us. recovered, They rest as But Florida, through this soon evolution example. do state all our second the and of the the the trends country. the ups business to

people’s carefully those go and we on flows not that pretty outside So trends there effect It’s is is things well. this. to and dramatic, willingness as but on watch ebbs so an do and

Reuben Garner

I Okay. And virus guess to know, money well. talk are areas those there of what the growth brought you I a question, bit about just else? which exposure assume any you and of in Joybird to spend maybe two office those that to growing then you maybe seen the similar a I creating lot capacity folks Are environments. have serve markets, two everything constraints driven as them? do you have than can have little has I about a guess outdoors home you Can faster talk and

Kurt Darrow

case goods business portfolio. home office are our we the Well, in in

But that do furniture. a they and company more more in other there. the specifically put we going outdoor not La-Z-Boy benefit, I thing work they although more to the some provides are with think the do license future business have the is additions there out be, that a outdoor We remodel, agreement people

furniture of if you it was remodeled was new. it the home, old spot part as as good If quite remodel doesn’t new as look your your

people that’s more to So, best home there activity trend a the furnishings that happening want in benefit home, continues. make the in is to home if and their residual that more

Reuben Garner

you thank And out it, costs, have if you on deflationary that the or for inflation any you already sense. me makes time. you buckets but touched apologies one and guys if again input would Yes, material haven’t and call already for last

Melinda Whittington

raw stable slight for maybe Yes, interest pretty a thank to standpoint, you From looks materials the a year-on-year. right but now tailwind, today. cost be to fairly stable really

call really the we XX% people previous the the bringing the Newton manufacturing a same but but SG&A of folks in and tailwind Our the time side, do the back we across the and and to or couple as reduction through workforce, including challenges at about a of as closing the just question, – we spent couple did that will a bit our plant, the costs a quarters. as both primarily of in time in go the current with talking be lot well headwind the hiring in in of next the

we the had The around have other of lot QX point and out a tariffs I continued really that exclusions now, Unfortunately, expense to expenses would fourth those going us be a news had us end so we when back amount X received we good activity had just those thing that basis. to quarter. by we have governmental been will rebated for with plus that had we of we have and on the having tariff where at not Chinese tariff the of is that were years in these a healthy authorities,

very least in in look quarter quarters quarter tariffs last be it those a were to and would headwind QX the QX of of in of year. we two because a a at that from would So similar, bit three hiatus a for

Reuben Garner

Thanks, stay safe again and everybody.

Melinda Whittington

Thank you.

Operator

additional closing will back other to turn comments. conference the And questions any with no holding, now I or management for

Kathy Liebmann

for today. call much very joining you our Thank

a any please Have If you Bye-bye. day. touch. be ups, great follow in have

Operator

and Ladies your that We conclude call. today’s you. participation. thank for gentlemen Thank will you

may disconnect this time have at You a great and day.

La-Z-Boy (LZB) 19 Aug 202021 Q1 Earnings call transcript