Lumber Liquidators (Toano, Va.) cut its earnings outlook Thursday, which sent its stock price plummeting to a new 52-week low of $18.20; by Friday afternoon the stock was up slightly to $18.69.
Lumber Liquidators (Toano, Va.) cut its earnings outlook Thursday, which sent its stock price plummeting to a new 52-week low of $18.20; by Friday afternoon the stock was up slightly to $18.69.
Based on its sales results so far this year and current market conditions, the company cut its 2011 net sales outlook by about 4 percent from $700-$730 million to $670-$700 million. What's more, the company said its same-store net sales for the year would fall in the low single digits. Lumber Liquidators also cut its earnings outlook from a range of $1.13-$1.28 to $1.00-$1.15, and it narrowed its new-store openings goal from 40-50 to 40-44.
In the near-term, the company expects net sales in the second quarter of 2011 to increase about 4.0 percent to $175.5 million, from $168.7 million in the second quarter of 2010. Same-store net sales are expected to fall 8 percent compared with an increase of 5.5 percent during the second quarter of 2010. Also, the company expects second quarter 2011 earnings per share in the range of $0.18-$0.20, compared to earnings per diluted share of $0.32 in the second quarter of 2010.
Lumber Liquidators CEO Jeffrey W. Griffiths said his company did not anticipate a softening of customer demand in the second quarter after seeing improved sales trends in the first quarter. "… We believe value-conscious consumers became more price sensitive and cautious in their discretionary spending," Griffiths said. Still, internal indicators like catalog and sample requests "remain positive in comparison to 2010." Griffiths also said the company's store operations are more focused on and capable of converting demand to sales, perhaps alluding to a past software flub that has been fixed.