What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-11-19 compared with 2024-08-20 · 113 added, 56 removed, 457 unchanged (27% of the section changed)

2 unchanged sentences

CONSOLIDATED STATEMENT OF INCOME

Quarter Ended

Quarter Ended Six Months Ended

(Unaudited, amounts in thousands, except per share data) 10/26/2024 10/28/2023 10/26/2024 10/28/2023

17 unchanged sentences

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

T able of Contents

LA-Z-BOY INCORPORATED

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Quarter Ended

Quarter Ended Six Months Ended

(Unaudited, amounts in thousands) 10/26/2024 10/28/2023 10/26/2024 10/28/2023

Net income $ 29,853 $ 27,694 $ 56,657 $ 55,620

Other comprehensive income

Other comprehensive income (loss)

Currency translation adjustment 1,612 ( 3,615 ) 3,145 ( 2,568 )

Net unrealized gain on marketable securities, net of tax 113 220

Net unrealized gain (loss) on marketable securities, net of tax ( 17 ) ( 87 ) 96 133

Net pension amortization, net of tax 16 24 31 47

Total other comprehensive income 1,661 1,290

Total other comprehensive income (loss) 1,611 ( 3,678 ) 3,272 ( 2,388 )

Total comprehensive income before noncontrolling interests 31,464 24,016 59,929 53,232

2 unchanged sentences

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

T able of Contents

LA-Z-BOY INCORPORATED

35 unchanged sentences

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

T able of Contents

LA-Z-BOY INCORPORATED

CONSOLIDATED STATEMENT OF CASH FLOWS

Quarter Ended

Six Months Ended

(Unaudited, amounts in thousands) 10/26/2024 10/28/2023

2 unchanged sentences

Adjustments to reconcile net income to cash provided by operating activities

(Gain)/loss on disposal and impairment of assets ( 117 ) 113

(Gain)/loss on sale of investments ( 80 ) 307

Loss on disposal and impairment of assets 40 559

Gain on sale of investments ( 113 ) ( 1,136 )

Provision for doubtful accounts 477 44

20 unchanged sentences

Payments on finance lease liabilities ( 291 ) ( 206 )

Holdback payments for acquisitions — ( 5,000 )

Stock issued for stock and employee benefit plans, net of shares withheld for taxes 9,887 ( 1,859 )

1 unchanged sentence

Dividends paid to shareholders ( 16,731 ) ( 15,632 )

Dividends paid to minority interest joint venture partners (1) ( 1,414 ) ( 1,172 )

Net cash used for financing activities ( 61,693 ) ( 43,883 )

5 unchanged sentences

Capital expenditures included in payables $ 4,420 $ 3,079

(1) Includes dividends paid to joint venture minority partners resulting from the repatriation of dividends from our foreign earnings that we no longer consider permanently reinvested.

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

T able of Contents

LA-Z-BOY INCORPORATED

19 unchanged sentences

At July 27, 2024 $ 42,015 $ 371,421 $ 590,308 $ ( 4,535 ) $ 11,267 $ 1,010,476

Net income (loss) — — 30,037 — ( 184 ) 29,853

Other comprehensive income — — — 923 688 1,611

Stock issued for stock and employee benefit plans, net of cancellations and withholding tax 99 1,920 ( 6 ) — — 2,013

Repurchases of 467 shares of common stock

( 467 ) ( 1,955 ) ( 17,222 ) — — ( 19,644 )

Stock option and restricted stock expense — 5,872 — — — 5,872

Dividends declared and paid ($ 0.20 /share) (1)

— — ( 8,360 ) — ( 1,414 ) ( 9,774 )

Dividends declared not paid ($ 0.20 /share)

— — ( 125 ) — — ( 125 )

At October 26, 2024 $ 41,647 $ 377,258 $ 594,632 $ ( 3,612 ) $ 10,357 $ 1,020,282

(1) Non-controlling interests include dividends paid to joint venture minority partners resulting from the repatriation of dividends from our foreign earnings that we no longer consider permanently reinvested.

(Unaudited, amounts in thousands, except per share data) Common

2 unchanged sentences

Earnings Accumulated Other

Comprehensive

Loss Non-Controlling

Comprehensive Income (Loss) Non-Controlling

Interests Total

11 unchanged sentences

At July 29, 2023 $ 43,110 $ 356,684 $ 557,666 $ ( 4,198 ) $ 10,668 $ 963,930

Net income — — 27,199 — 495 27,694

Other comprehensive loss — — — ( 3,194 ) ( 484 ) ( 3,678 )

Stock issued for stock and employee benefit plans, net of cancellations and withholding tax 91 32 ( 4 ) — — 119

Repurchases of 326 shares of common stock

( 326 ) ( 118 ) ( 9,561 ) — — ( 10,005 )

Stock option and restricted stock expense — 4,811 — — — 4,811

Dividends declared and paid ($ 0.1815 /share) (1)

— — ( 7,780 ) — ( 1,172 ) ( 8,952 )

Dividends declared not paid ($ 0.1815 /share)

— — ( 129 ) — — ( 129 )

At October 28, 2023 $ 42,875 $ 361,409 $ 567,391 $ ( 7,392 ) $ 9,507 $ 973,790

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

T able of Contents

LA-Z-BOY INCORPORATED

20 unchanged sentences

Improvements to Income Tax Disclosures Fiscal 2026

ASU 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses Fiscal 2028

None of the below acquisitions were significant to our consolidated financial statements, and, therefore, pro-forma financial information is not presented.

5 unchanged sentences

For federal income tax purposes, we amortize and deduct these indefinite-lived intangible assets and goodwill, if any, over 15 years.

T able of Contents

Melbourne and Cocoa, Florida Acquisition

On September 10, 2024, we completed our acquisition of the Melbourne and Cocoa, Florida business that operates two independently owned La-Z-Boy Furniture Galleries ® stores and one distribution center for $ 11.4 million, inclusive of and subject to further customary adjustments.

The acquisition also included the purchase of buildings and land for both stores and the distribution center.

We paid total cash of $ 10.0 million during the second quarter of fiscal 2025 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

As part of the acquisition, we recorded an indefinite-lived intangible asset of $ 0.9 million related to the reacquired rights described above.

We also recognized $ 1.7 million of goodwill in our Retail segment related primarily to synergies we expect from the integration of the acquired store and future benefits of these synergies.

Davenport, Iowa Acquisition

On July 22, 2024, we completed our acquisition of the Davenport, Iowa business that operates one independently owned La-Z-Boy Furniture Galleries ® store for $ 7.4 million, inclusive of and subject to further customary adjustments.

We paid total cash of $ 5.8 million during the first quarter of fiscal 2025 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

We paid total cash of $ 6.9 million during the first and second quarters of fiscal 2025 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

As part of the acquisition, we recorded an indefinite-lived intangible asset of $ 1.7 million related to the reacquired rights described above.

1 unchanged sentence

Prior Year Acquisitions

Lafayette, Louisiana Acquisition

On October 23, 2023, we completed our acquisition of the Lafayette, Louisiana business that operates one independently owned La-Z-Boy Furniture Galleries ® store and one distribution center for $ 2.8 million, inclusive of customary adjustments.

We paid total cash of $ 2.6 million during the second and third quarters of fiscal 2024 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

As part of the acquisition, we recorded an indefinite-lived intangible asset of $ 0.7 million related to the reacquired rights described above.

We also recognized $ 2.1 million of goodwill in our Retail segment related primarily to synergies we expect from the integration of the acquired store and future benefits of these synergies.

Colorado Springs, Colorado Acquisition

4 unchanged sentences

Cash and Restricted Cash

At July 29, 2023, we had restricted cash on deposit with a bank as collateral for certain letters of credit that matured within 12 months.

At October 28, 2023, we had restricted cash on deposit with a bank as collateral for certain letters of credit that matured within 12 months.

During fiscal 2024, we renewed these letters of credit and as of April 27, 2024, we were no longer required to hold restricted cash as collateral.

12 unchanged sentences

Total inventories $ 289,209 $ 263,237

T able of Contents

Goodwill and Other Intangible Assets

14 unchanged sentences

Translation adjustment 752 ( 56 ) — 696

Balance at July 27, 2024 (1)

Balance at October 26, 2024 (1)

$ 20,837 $ 145,667 $ 55,446 $ 221,950

17 unchanged sentences

Translation adjustment — — ( 42 ) 62 20

Balance at July 27, 2024 $ 1,155 $ 1,596 $ 44,279 $ 1,654 $ 48,684

Balance at October 26, 2024 $ 1,155 $ 1,397 $ 45,183 $ 1,610 $ 49,345

We test indefinite-lived intangibles and goodwill for impairment on an annual basis in the fourth quarter of each fiscal year, and more frequently if events or changes in circumstances indicate that an asset might be impaired.

2 unchanged sentences

Our short-term investments are included in other current assets and our long-term investments are included in other long-term assets on our consolidated balance sheet.

T able of Contents

The following summarizes our investments:

20 unchanged sentences

The following table summarizes sales of marketable securities:

Quarter Ended

Quarter Ended Six Months Ended

(Unaudited, amounts in thousands) 10/26/2024 10/28/2023 10/26/2024 10/28/2023

14 unchanged sentences

We provide a limited lifetime warranty against defects on a majority of the Joybird products, which are a part of our Corporate and Other results.

T able of Contents

manufacturer warranties, the warranty period begins when the consumer receives our product.

For all our manufacturer warranties, the warranty period begins when the consumer receives our product.

We use considerable judgment in making our estimates, and we record differences between our actual and estimated costs when the differences are known.

A reconciliation of the changes in our product warranty liability is as follows:

Quarter Ended

Quarter Ended Six Months Ended

(Unaudited, amounts in thousands) 10/26/2024

10/28/2023 (1) 10/26/2024 (2)

10/28/2023 (1)

Balance as of the beginning of the period $ 29,478 $ 30,794 $ 28,909 $ 30,984

2 unchanged sentences

Balance as of the end of the period $ 29,552 $ 31,127 $ 29,552 $ 31,127

(1) $ 22.5 million and $ 22.4 million is recorded in accrued expenses and other current liabilities as of July 27, 2024, and April 27, 2024, respectively, while the remainder is included in other long-term liabilities.

(1) Accruals and settlements for fiscal 2024 have been revised.

The adjustments were offsetting and had no impact on the liability balance at the end of each reporting period in fiscal 2024 or the amount recognized in the consolidated statement of income for fiscal 2024

(2) $ 22.0 million and $ 22.4 million is recorded in accrued expenses and other current liabilities as of October 26, 2024, and April 27, 2024, respectively, while the remainder is included in other long-term liabilities..

We recorded accruals during the periods presented in the table above, primarily to reflect charges that relate to warranties issued during the respective periods.

1 unchanged sentence

The table below summarizes the total stock-based compensation expense we recognized for all outstanding grants in our consolidated statement of income:

Quarter Ended

Quarter Ended Six Months Ended

(Unaudited, amounts in thousands) 10/26/2024 10/28/2023 10/26/2024 10/28/2023

1 unchanged sentence

Liability-based awards expense (1)

( 57 ) ( 35 ) 104 53

Total stock-based compensation expense $ 5,815 $ 4,776 $ 9,151 $ 7,390

2 unchanged sentences

Restricted Stock .

During the first quarter of fiscal 2025, we granted 240,334 shares of restricted stock units to employees and we also have restricted stock awards outstanding from previous grants.

During the first six months of fiscal 2025, we granted 241,334 shares of restricted stock units to employees and we also have restricted stock awards outstanding from previous grants.

We issue restricted stock at no cost to the employees and account for restricted stock awards as equity-based awards because when they vest, they will be settled in common shares.

3 unchanged sentences

We have elected to recognize forfeitures as an adjustment to compensation expense in the same period as the forfeitures occur.

The weighted-average fair value of the restricted stock that was awarded in the first quarter of fiscal 2025 was $ 38.04 per share, the market value of our common shares on the date of grant.

The weighted-average fair value of the restricted stock that was awarded in the first six months of fiscal 2025 was $ 38.05 per share, the market value of our common shares on the date of grant.

Restricted Stock Units Issued to Directors.

During the second quarter of fiscal 2025, we granted 30,348 restricted stock units to our non-employee directors.

Restricted stock units granted to our non-employee directors are offered at no cost to the directors

and restricted stock units granted following August 2022 vest on the earlier of the date a director ceases to be a member of the board (for any reason other than the termination of service for cause) or the- one year anniversary of the grant date.

We account for these restricted stock units as equity-based awards because when they vest, they will be settled in shares of our common stock.

We measure and recognize compensation expense for these awards based on the market price of our common shares on the date of grant.

The weighted-average fair value of the restricted stock units granted to our non-employee directors in the second quarter of fiscal 2025 was $ 40.04 per share.

Performance Shares.

4 unchanged sentences

In the event of an employee's termination during the vesting period, the potential right to earn shares under this program is generally forfeited and we have elected to recognize forfeitures as an adjustment to compensation expense in the same period in which the forfeitures occur.

For shares that vest based on our results relative to the performance goals, we expense as compensation cost the fair value of the shares as of the day we granted the awards recognized over the performance period,

T able of Contents

taking into account the probability that we will satisfy the performance goals.

The fair value of each share of the awards we granted in fiscal 2025 that vest based on attaining performance goals was $ 35.59 , the market value of our common shares on the date we granted the awards less the dividends we expect to pay before the shares vest.

4 unchanged sentences

Stock Options.

We did not grant stock options to employees during the first quarter of fiscal 2025, but we have stock options outstanding from grants from prior years.

We did not grant stock options to employees during the first six months of fiscal 2025, but we have stock options outstanding from grants from prior years.

We account for stock options as equity-based awards because when they are exercised, they will be settled in common shares.

7 unchanged sentences

Accumulated Other Comprehensive Income (Loss)

Activity in accumulated other comprehensive income (loss) for the quarters ended July 27, 2024, and July 29, 2023, is as follows:

Activity in accumulated other comprehensive income (loss) for the quarters ended October 26, 2024, and October 28, 2023, is as follows:

(Unaudited, amounts in thousands) Translation adjustment Unrealized gain (loss) on marketable securities Net pension amortization and net actuarial loss Accumulated other comprehensive income (loss)

Balance at April 27, 2024 $ ( 3,804 ) $ 246 $ ( 2,312 ) $ ( 5,870 )

Balance at July 27, 2024 $ ( 2,597 ) $ 359 $ ( 2,297 ) $ ( 4,535 )

Changes before reclassifications 924 ( 21 ) — 903

1 unchanged sentence

Tax effect — 6 ( 5 ) 1

Other comprehensive income attributable to La-Z-Boy Incorporated 1,207 113 15 1,335

Other comprehensive income (loss) attributable to La-Z-Boy Incorporated 924 ( 17 ) 16 923

Balance at October 26, 2024 $ ( 1,673 ) $ 342 $ ( 2,281 ) $ ( 3,612 )

Balance at July 29, 2023 $ ( 1,565 ) $ 75 $ ( 2,708 ) $ ( 4,198 )

Changes before reclassifications ( 3,131 ) ( 139 ) — ( 3,270 )

Amounts reclassified to net income — 24 31 55

Tax effect — 28 ( 7 ) 21

Other comprehensive income (loss) attributable to La-Z-Boy Incorporated ( 3,131 ) ( 87 ) 24 ( 3,194 )

Balance at October 28, 2023 $ ( 4,696 ) $ ( 12 ) $ ( 2,684 ) $ ( 7,392 )

Activity in accumulated other comprehensive income (loss) for the six months ended October 26, 2024, and October 28, 2023, is as follows:

(Unaudited, amounts in thousands) Translation adjustment Unrealized gain (loss) on marketable securities Net pension amortization and net actuarial loss Accumulated other comprehensive income (loss)

Balance at April 27, 2024 $ ( 3,804 ) $ 246 $ ( 2,312 ) $ ( 5,870 )

3 unchanged sentences

Other comprehensive income attributable to La-Z-Boy Incorporated 2,131 96 31 2,258

Balance at July 29, 2023 $ ( 1,565 ) $ 75 $ ( 2,708 ) $ ( 4,198 )

Balance at October 26, 2024 $ ( 1,673 ) $ 342 $ ( 2,281 ) $ ( 3,612 )

Balance at April 29, 2023 $ ( 2,652 ) $ ( 145 ) $ ( 2,731 ) $ ( 5,528 )

Changes before reclassifications ( 2,044 ) ( 154 ) — ( 2,198 )

Amounts reclassified to net income — 331 62 393

Tax effect — ( 44 ) ( 15 ) ( 59 )

Other comprehensive income (loss) attributable to La-Z-Boy Incorporated ( 2,044 ) 133 47 ( 1,864 )

Balance at October 28, 2023 $ ( 4,696 ) $ ( 12 ) $ ( 2,684 ) $ ( 7,392 )

We reclassified both the unrealized gain (loss) on marketable securities and the net pension amortization from accumulated other comprehensive loss to net income through other income (expense), net.

T able of Contents

The components of noncontrolling interest were as follows:

Quarter Ended

Quarter Ended Six Months Ended

(Unaudited, amounts in thousands) 10/26/2024 10/28/2023 10/26/2024 10/28/2023

Balance as of the beginning of the period $ 11,267 $ 10,668 $ 10,296 $ 10,261

Net income 645 447

Net income (loss) ( 184 ) 495 461 942

Other comprehensive income (loss) 688 ( 484 ) 1,014 ( 524 )

Dividends distributed to joint venture minority partners ( 1,414 ) ( 1,172 ) ( 1,414 ) ( 1,172 )

Balance as of the end of the period $ 10,357 $ 9,507 $ 10,357 $ 9,507

11 unchanged sentences

The following table presents our revenue disaggregated by product category and by segment or unit:

Quarter Ended July 27, 2024 Quarter Ended July 29, 2023

Quarter Ended October 26, 2024 Quarter Ended October 28, 2023

(Unaudited, amounts in thousands) Wholesale Retail Corporate

8 unchanged sentences

Consolidated Net Sales $ 521,027 $ 511,435

Six Months Ended October 26, 2024 Six Months Ended October 28, 2023

(Unaudited, amounts in thousands) Wholesale Retail Corporate

and Other Total Wholesale Retail Corporate

and Other Total

Upholstered Furniture $ 568,285 $ 346,647 $ 60,263 $ 975,195 $ 547,389 $ 343,703 $ 54,791 $ 945,883

Casegoods Furniture 36,050 23,878 5,520 65,448 38,223 24,775 5,492 68,490

Delivery 78,819 15,475 4,276 98,570 83,698 15,558 3,657 102,913

Other (1) 31,643 37,934 10,736 80,313 29,132 38,516 12,353 80,001

Total $ 714,797 $ 423,934 $ 80,795 $ 1,219,526 $ 698,442 $ 422,552 $ 76,293 $ 1,197,287

Eliminations ( 202,967 ) ( 204,201 )

Consolidated Net Sales $ 1,016,559 $ 993,086

(1) Primarily includes revenue for advertising, royalties, parts, accessories, after-treatment products, surcharges, rebates and other sales incentives.

5 unchanged sentences

This revenue includes sales to La-Z-Boy Furniture Galleries ® stores (including company-owned stores), independent retailers, and the end consumer.

T able of Contents

Contract Assets and Liabilities.

8 unchanged sentences

$ 120,590 $ 124,316

(1) During the quarter ended July 27, 2024, we recognized revenue of $ 109.9 million related to our contract liability balance at April 27, 2024.

(1) During the six months ended October 26, 2024, we recognized revenue of $ 115.6 million related to our contract liability balance at April 27, 2024.

Segment Information

14 unchanged sentences

None of the operating segments included in Corporate and Other meet the requirements of reportable segments.

T able of Contents

The following table presents sales and operating income (loss) by segment:

Quarter Ended

Quarter Ended Six Months Ended

(Unaudited, amounts in thousands) 10/26/2024 10/28/2023 10/26/2024 10/28/2023

19 unchanged sentences

Income before income taxes $ 40,524 $ 37,657 $ 76,490 $ 75,673

Our effective tax rate was 25.5 % for the quarter ended July 27, 2024, compared with 26.5 % for the quarter ended July 29, 2023.

The reduced effective tax rate in the first quarter of fiscal 2025 was partially the result of tax benefits from the vesting of stock-based compensation.

Our effective tax rate was 26.3 % and 25.9 % for the second quarter and six months ended October 26, 2024, respectively, compared with 26.5 % for both the second quarter and six months ended October 28, 2023.

Our effective tax rate varies from the 21 % federal statutory rate primarily due to state taxes.

T able of Contents

Earnings per Share

The following is a reconciliation of the numerators and denominators we used in our computations of basic and diluted earnings per share:

Quarter Ended

Quarter Ended Six Months Ended

(Unaudited, amounts in thousands, except per share data) 10/26/2024 10/28/2023 10/26/2024 10/28/2023

11 unchanged sentences

We exclude the effect of options from our diluted share calculation when the weighted average exercise price of the options is higher than the average market price, since including the options' effect would be anti-dilutive.

For the quarters ended July 27, 2024 and July 29, 2023, we excluded options to purchase 0.2 million shares and 0.7 million shares from the diluted share calculation, respectively.

For the second quarter and six months ended October 26, 2024, we did no t exclude any outstanding options from the diluted share calculation.

For the second quarter and six months ended October 28, 2023, we excluded options to purchase 0.5 million and 0.7 million shares, respectively, from the diluted share calculation.

Fair Value Measurements

8 unchanged sentences

We measure non-financial assets such as other intangible assets, goodwill, and other long-lived assets at fair value when there is an indicator of impairment, and we record them at fair value only when we recognize an impairment loss.

T able of Contents

The following table presents the fair value hierarchy for those assets and liabilities we measured at fair value on a recurring basis at July 27, 2024 and April 27, 2024.

The following table presents the fair value hierarchy for those assets and liabilities we measured at fair value on a recurring basis at October 26, 2024 and April 27, 2024.

There were no transfers into or out of Level 1, Level 2, or Level 3 for any of the periods presented.

At July 27, 2024

At October 26, 2024

Fair Value Measurements

10 unchanged sentences

(1) Certain marketable securities investments are measured at fair value using net asset value per share under the practical expedient methodology.

At July 27, 2024 and April 27, 2024, we held marketable securities intended to enhance returns on our cash and to fund future obligations of certain retirement plans.

At October 26, 2024 and April 27, 2024, we held marketable securities intended to enhance returns on our cash and to fund future obligations of certain retirement plans.

The fair value measurements for our Level 1 and Level 2 securities are based on quoted prices in active markets, as well as through broker quotes and independent valuation providers, multiplied by the number of shares owned exclusive of any transaction costs.

T able of Contents

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements