Flooring retailer widens net loss

Lumber Liquidators widened its net loss in the third quarter, though the retailer did move the needle on net sales, which rose 3.4%.



Lumber Liquidators reported a bigger-than-expected net loss of $18.4 million for the quarter, compared to a loss of $8.5 million in the year-ago period, amid higher-than-expected expenses, including legal fees, as the company continues to rebound from last year's investigation into formaldehyde levels in flooring it had previously sold.



Net sales for the third quarter ended Sept. 30 were $244.1 million, up 3.4% year-over-year. Comparable store net sales were up 1.0%, which reflected a 0.5% increase in customers invoiced in comparable stores.



"We are pleased with the direction of our sales performance this quarter but recognize we have work to do to restore Lumber Liquidators to growth and profitability for the long term," said CEO John Presley. "We continue to invest in our value proposition while focusing on execution within the business and have taken steps to strengthen our financial position. We remain committed to the strategic direction we set for the company and believe our actions will improve our performance over time."



Gross margin also rose to 31.4% from 30.1% in the prior-year period. The company attributed this to its pricing strategy of reduced promotional activity and the sale of clearance product from 2015 levels, as well as increases in the sales mix of high-margin laminates and vinyl.