Q4 2024 Flexsteel Industries Inc Earnings Call Transcript
Key Points
- Flexsteel Industries Inc (FLXS) reported a 4.7% sales growth in the fourth quarter, marking the third consecutive quarter of year-over-year growth.
- Annual sales growth for fiscal year 2024 was 4.8%, outperforming many industry participants who experienced double-digit declines.
- Adjusted operating margin improved to 5.6% in the fourth quarter, up from 4% in the prior year quarter.
- The company reduced inventories by over $25 million in fiscal year 2024 while maintaining strong customer service levels.
- Flexsteel Industries Inc (FLXS) generated almost $32 million in operating cash flow, significantly reducing bank debt.
- Weak consumer demand is expected to continue to be a major headwind for the industry in the near term.
- The impact of inflation and high interest rates is negatively affecting consumer confidence and the housing market, which is crucial for furniture demand.
- E-commerce sales have been particularly challenging, with sluggish performance in the ready-to-assemble homestyles business.
- The company faces ongoing pressure from ocean freight costs, necessitating the implementation of surcharges.
- Wage pressures in distribution centers and Mexico operations are expected to impact costs in the second half of the fiscal year.
Good day and welcome to the fourth quarter fiscal year 2024 earnings results conference call. (Operator Instructions) Please note this event is being recorded.
I would now like to turn the conference over to Mike Ressler, Chief Financial Officer. Please go ahead.
Thank you, and welcome to today's call to discuss Flexsteel Industries fourth quarter and fiscal year 2024 financial results. Our earnings release, which we issued after market close yesterday, Monday, August 19 is available on the Investor Relations section of our website at www.flexsteel.com under News and Events.
I'm here today with Derek Schmidt, President and Chief Executive Officer. On today's call, we will provide prepared remarks and we will then open the call to your questions. Before we begin, I would like to remind you that the comments on today's call will include forward-looking statements, which can be identified using words such as
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