Lumber Liquidators had a net income of $5.9 million during the third quarter of 2018, a turnaround compared with the same period last year, when the company had a net loss of $18.9 million.
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Lumber Liquidators had a net income of $5.9 million during the third quarter of 2018, a turnaround compared with the same period last year, when the company had a net loss of $18.9 million.
The company’s net sales during the quarter increased 5.2 percent to $270.5 million. Lumber Liquidators’ diluted earnings per share fell to $0.21 compared with $0.66 during the third quarter of 2017.
“We continued our growth in installation sales, and after opening three new stores in the third quarter, we are on target to open 22 new stores in 2018,” CEO Dennis Knowles said in a statement. “We are confident that our team is well-positioned to drive our business and digital strategy going forward.”
Lumber Liquidators, which sources approximately 45 percent of its products from China, is also bracing itself for the full impact of the 10 percent tariffs on Chinese products imposed Sept. 24 by the Trump administration. The tariffs are slated to increase to 25 percent beginning Jan. 1.
“The company has several approaches to address this situation, including adjusting its pricing, partnering with current vendors to lower costs, and altering its supply chain to source the same or similar products from other countries at lower costs,” Lumber Liquidators stated. “As the company examines each product, it employs one or more of the above approaches in an effort to mitigate the impacts of these tariffs.”
During the quarter, the company received approval from a district court for $36 million settlement in a class-action lawsuit over high levels of formaldehyde in its Chinese-made laminate flooring sold between 2009 and 2015. The company has largely been in recovery mode since the formaldehyde levels were first reported by 60 Minutes in 2015.
With the three stores opened during the quarter, Lumber Liquidators now has 409 locations.
The company’s stock dropped 6.4 percent after its earnings report was released Oct. 30 and closed at $11.54. The stock hit a new 52-week low that same day when it fell to $9.95 after opening at $10.78, according to Equities.com.
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