Lumber Liquidators sales better than expected

Despite bad publicity from a “60 Minutes” report alleging carcinogens in some of the hardwood it sells, Lumber Liquidators increased sales in the first quarter of 2015.

The company saidsales were $260 million, an increase of 6% from the first quarter of 2014. The figure beat the $258.2 million Wall Street consensus.

The company did report, however, that net sales in March were consistent with company's previously released expectations and negatively impacted by the “60 Minutes” report. The company saidnet sales in March were $89.4 million, a decrease of 13% compared to March 2014.

Lumber Liquidators opened four new stores during first quarter 2015 and was operating 356 locations at March 31, 2015.

Same-store sales dropped 1.8% in comparison to first quarter 2014, due to a 6.2% decrease in the average sale, partially offset by a 4.4% increase in the number of customers invoiced. In the month of March, same-store sales decreased 17.8% due to a 6.5% decrease in the average sale and an 11.3% decrease in the number of customers invoiced.



Total laminate net sales, which were 21.2% of net sales through February, fell 4.8 percentage points to 16.4% in the month of March 2015, primarily due to a decrease in the sales mix of laminates sourced from China. Additionally, in comparing March to the first two months of the quarter, the sales mix of bamboo, vinyl plank and cork fell 1.2 percentage points while the sales mix of solid and engineered hardwoods rose 4.7 percentage points.

The company said in a statement: "Customer care has been the company's primary focus in March 2015. To reassure its customers, the company implemented an air quality testing program at no cost to the customer. As part of that program, through the end of the first quarter of 2015, approximately 10,000 of the Company's customers have requested in-home air quality test kits. The test kit is sent directly to the customer by an independent testing organization. After receiving the test kit, the customer is in control of the process. Clear instructions are provided on how to conduct the test and to mail the completed kit directly to a third-party lab. Though the timeframe will vary by customer, once a test kit is received by the lab, the customer is expected to be informed of the results within approximately seven to ten days. Consequently, the entire process from request to results may take several weeks or more."