LA-Z-BOY INCORPORATED
|
(Exact name of registrant as specified in its charter)
|
MICHIGAN
|
38-0751137
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
1284 North Telegraph Road, Monroe, Michigan
|
48162-3390
|
(Address of principal executive offices)
|
(Zip Code)
|
Title of each class
|
Name of each exchange on which registered
|
Common Shares, $1.00 Par Value
|
New York Stock Exchange
|
Large accelerated filer
x
|
Accelerated filer
o
|
Non-accelerated filer
o
|
Smaller reporting company
o
|
(1) | Portions of the Registrant’s Proxy Statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A for its 2014 Annual Meeting of Shareholders are incorporated by reference into Part III. |
Page
Number(s)
|
||
3
|
||
|
|
|
PART I
|
||
Item 1.
|
3
|
|
Item 1A.
|
9
|
|
Item 1B.
|
12
|
|
Item 2.
|
13
|
|
Item 3.
|
13
|
|
Item 4.
|
13
|
|
14
|
||
|
|
|
PART II
|
||
Item 5.
|
15
|
|
Item 6.
|
19
|
|
Item 7.
|
23
|
|
Item 7A.
|
39
|
|
Item 8.
|
40
|
|
Item 9.
|
78
|
|
Item 9A.
|
78
|
|
Item 9B.
|
79
|
|
|
|
|
PART III
|
||
Item 10.
|
79
|
|
Item 11.
|
79
|
|
Item 12.
|
79
|
|
Item 13.
|
79
|
|
Item 14.
|
79
|
|
|
|
|
PART IV
|
||
Item 15.
|
80
|
¾
future income, margins and cash flows
|
¾
future economic performance
|
¾
future growth
|
¾
industry and importing trends
|
¾
adequacy and cost of financial resources
|
¾
management plans
|
|
|
Market Price
|
||||||||||||||
Fiscal 2014
Quarter
Ended
|
Dividends
Paid
|
High
|
Low
|
Close
|
||||||||||||
July 27
|
$
|
0.04
|
$
|
22.33
|
$
|
17.48
|
$
|
20.34
|
||||||||
October 26
|
$
|
0.04
|
$
|
24.42
|
$
|
20.12
|
$
|
23.35
|
||||||||
January 25
|
$
|
0.06
|
$
|
31.22
|
$
|
22.79
|
$
|
27.19
|
||||||||
April 26
|
$
|
0.06
|
$
|
28.48
|
$
|
24.04
|
$
|
24.55
|
||||||||
|
$
|
0.20
|
|
|
Market Price
|
||||||||||||||
Fiscal 2013
Quarter
Ended
|
Dividends
Paid
|
High
|
Low
|
Close
|
||||||||||||
July 28
|
$
|
—
|
$
|
16.43
|
$
|
10.95
|
$
|
12.09
|
||||||||
October 27
|
$
|
—
|
$
|
17.13
|
$
|
11.46
|
$
|
16.18
|
||||||||
January 26
|
$
|
0.04
|
$
|
17.06
|
$
|
13.30
|
$
|
15.74
|
||||||||
April 27
|
$
|
0.04
|
$
|
19.43
|
$
|
15.00
|
$
|
17.69
|
||||||||
|
$
|
0.08
|
Plan category
|
Number of
securities to be
issued upon
exercise of
outstanding options
(i)
|
Weighted-
average
exercise
price of
outstanding
options
(ii)
|
Number of securities
remaining available for
future issuance under
equity compensation
plans (excluding
securities reflected in
column (i))
(iii)
|
|||||||||
Equity compensation plans approved by shareholders
|
798,270
|
(1)
|
$
|
11.79
|
6,828,381
|
(2)
|
Company/Index/Market
|
2009
|
2010
|
2011
|
2012
|
2013
|
2014
|
||||||||||||||||||
La-Z-Boy Incorporated
|
$
|
100
|
$
|
679.72
|
$
|
541.94
|
$
|
706.91
|
$
|
819.30
|
$
|
1,146.54
|
||||||||||||
$
|
100
|
$
|
143.50
|
$
|
164.03
|
$
|
172.49
|
$
|
198.92
|
$
|
239.23
|
|||||||||||||
Dow Jones U.S. Furnishings Index
|
$
|
100
|
$
|
173.53
|
$
|
206.76
|
$
|
197.97
|
$
|
182.03
|
$
|
200.96
|
(Shares in thousands)
|
Total
number of
shares
purchased
|
Average
price
paid per
share
|
Total number
of shares
purchased as
part of
publicly
announced
plan
|
Maximum
number of
shares that
may yet be
purchased
under the
plan
|
||||||||||||
Fiscal February (January 26 – March 1, 2014)
|
201
|
$
|
26.52
|
201
|
3,080
|
|||||||||||
Fiscal March (March 2 – March 29, 2014)
|
230
|
$
|
26.42
|
230
|
2,850
|
|||||||||||
Fiscal April (March 30 – April 26, 2014)
|
15
|
$
|
26.78
|
15
|
2,835
|
|||||||||||
Fiscal Fourth Quarter of 2014
|
446
|
$
|
26.48
|
446
|
2,835
|
(Dollar amounts in thousands, except per share data)
|
(52 weeks)
|
(52 weeks)
|
(52 weeks)
|
(53 weeks)
|
(52 weeks)
|
|||||||||||||||
Fiscal Year Ended
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
4/30/2011
|
4/24/2010
|
|||||||||||||||
Sales
|
$
|
1,357,318
|
$
|
1,273,877
|
$
|
1,166,705
|
$
|
1,115,489
|
$
|
1,101,632
|
||||||||||
Cost of sales
|
||||||||||||||||||||
Cost of goods sold
|
888,025
|
854,542
|
795,957
|
773,256
|
738,625
|
|||||||||||||||
Restructuring
|
4,839
|
2,480
|
13
|
(162
|
)
|
2,141
|
||||||||||||||
Total cost of sales
|
892,864
|
857,022
|
795,970
|
773,094
|
740,766
|
|||||||||||||||
Gross profit
|
464,454
|
416,855
|
370,735
|
342,395
|
360,866
|
|||||||||||||||
Selling, general and administrative expense
|
375,158
|
349,101
|
321,770
|
314,078
|
321,096
|
|||||||||||||||
Restructuring
|
—
|
151
|
268
|
650
|
1,293
|
|||||||||||||||
Write-down of long-lived assets
|
—
|
—
|
—
|
4,392
|
—
|
|||||||||||||||
Operating income
|
89,296
|
67,603
|
48,697
|
23,275
|
38,477
|
|||||||||||||||
Interest expense
|
548
|
746
|
1,384
|
2,346
|
2,972
|
|||||||||||||||
Interest income
|
761
|
620
|
609
|
943
|
723
|
|||||||||||||||
Income from Continued Dumping and Subsidy Offset Act, net
|
—
|
—
|
11,066
|
648
|
3,269
|
|||||||||||||||
Other income (expense), net
|
2,050
|
3,208
|
(38
|
)
|
402
|
482
|
||||||||||||||
Income from continuing operations before income taxes
|
91,559
|
70,685
|
58,950
|
22,922
|
39,979
|
|||||||||||||||
Income tax expense (benefit)
|
31,383
|
23,520
|
(25,052
|
)
|
7,409
|
10,669
|
||||||||||||||
Income from continuing operations
|
60,176
|
47,165
|
84,002
|
15,513
|
29,310
|
|||||||||||||||
Income (loss) from discontinued operations, net of tax
|
(3,796
|
)
|
17
|
4,906
|
1,860
|
2,049
|
||||||||||||||
Net income
|
56,380
|
47,182
|
88,908
|
17,373
|
31,359
|
|||||||||||||||
Net (income) loss attributable to noncontrolling interests
|
(1,324
|
)
|
(793
|
)
|
(942
|
)
|
6,674
|
1,342
|
||||||||||||
Net income attributable to La-Z-Boy Incorporated
|
$
|
55,056
|
$
|
46,389
|
$
|
87,966
|
$
|
24,047
|
$
|
32,701
|
||||||||||
|
||||||||||||||||||||
Net income attributable to La-Z-Boy Incorporated:
|
||||||||||||||||||||
Income from continuing operations attributable to La-Z-Boy Incorporated
|
$
|
58,852
|
$
|
46,372
|
$
|
83,060
|
$
|
22,187
|
$
|
30,652
|
||||||||||
Income (loss) from discontinued operations
|
(3,796
|
)
|
17
|
4,906
|
1,860
|
2,049
|
||||||||||||||
Net income attributable to La-Z-Boy Incorporated
|
$
|
55,056
|
$
|
46,389
|
$
|
87,966
|
$
|
24,047
|
$
|
32,701
|
||||||||||
|
||||||||||||||||||||
Basic weighted average shares
|
52,386
|
52,351
|
51,944
|
51,849
|
51,533
|
|||||||||||||||
Basic net income attributable to La-Z-Boy Incorporated per share:
|
||||||||||||||||||||
Income from continuing operations attributable to La-Z-Boy Incorporated
|
$
|
1.11
|
$
|
0.87
|
$
|
1.57
|
$
|
0.42
|
$
|
0.59
|
||||||||||
Income (loss) from discontinued operations
|
(0.07
|
)
|
—
|
0.09
|
0.04
|
0.04
|
||||||||||||||
Basic net income attributable to La-Z-Boy Incorporated per share
|
$
|
1.04
|
$
|
0.87
|
$
|
1.66
|
$
|
0.46
|
$
|
0.63
|
||||||||||
|
||||||||||||||||||||
Diluted weighted average shares
|
53,829
|
53,685
|
52,478
|
52,279
|
51,732
|
|||||||||||||||
Diluted net income (loss) attributable to La-Z-Boy Incorporated per share:
|
||||||||||||||||||||
Income from continuing operations attributable to La-Z-Boy Incorporated
|
$
|
1.09
|
$
|
0.85
|
$
|
1.55
|
$
|
0.41
|
$
|
0.58
|
||||||||||
Income (loss) from discontinued operations
|
(0.07
|
)
|
—
|
0.09
|
0.04
|
0.04
|
||||||||||||||
Diluted net income attributable to La-Z-Boy Incorporated per share
|
$
|
1.02
|
$
|
0.85
|
$
|
1.64
|
$
|
0.45
|
$
|
0.62
|
||||||||||
|
||||||||||||||||||||
Dividends declared per share
|
$
|
0.20
|
$
|
0.08
|
$
|
—
|
$
|
—
|
$
|
—
|
||||||||||
Book value of year-end shares outstanding
(1)
|
$
|
10.04
|
$
|
9.25
|
$
|
8.46
|
$
|
6.96
|
$
|
6.56
|
(Dollar amounts in thousands)
|
(52 weeks)
|
(52 weeks)
|
(52 weeks)
|
(53 weeks)
|
(52 weeks)
|
|||||||||||||||
Fiscal Year Ended
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
4/30/2011
|
4/24/2010
|
|||||||||||||||
Return on average total equity
(2)
|
11.8
|
%
|
10.0
|
%
|
20.7
|
%
|
4.4
|
%
|
9.1
|
%
|
||||||||||
Gross profit as a percent of sales
|
34.2
|
%
|
32.7
|
%
|
31.8
|
%
|
30.7
|
%
|
32.8
|
%
|
||||||||||
Operating profit as a percent of sales
|
6.6
|
%
|
5.3
|
%
|
4.2
|
%
|
2.1
|
%
|
3.5
|
%
|
||||||||||
Effective tax rate
(2)
|
34.3
|
%
|
33.3
|
%
|
(42.5
|
)%
|
32.3
|
%
|
26.7
|
%
|
||||||||||
Return on sales
(2)
|
4.4
|
%
|
3.7
|
%
|
7.2
|
%
|
1.4
|
%
|
2.7
|
%
|
||||||||||
|
||||||||||||||||||||
Depreciation and amortization
|
$
|
23,182
|
$
|
23,140
|
$
|
23,486
|
$
|
24,302
|
$
|
25,246
|
||||||||||
Capital expenditures
|
$
|
33,730
|
$
|
25,912
|
$
|
15,663
|
$
|
10,540
|
$
|
10,986
|
||||||||||
Property, plant and equipment, net
|
$
|
127,535
|
$
|
118,060
|
$
|
114,366
|
$
|
120,603
|
$
|
138,857
|
||||||||||
|
||||||||||||||||||||
Working capital
|
$
|
355,290
|
$
|
350,717
|
$
|
350,241
|
$
|
300,119
|
$
|
279,768
|
||||||||||
Current ratio
(3)
|
3.1 to 1
|
3.3 to 1
|
3.3 to 1
|
3.3 to 1
|
2.9 to 1
|
|||||||||||||||
Total assets
|
$
|
771,295
|
$
|
720,371
|
$
|
685,739
|
$
|
593,455
|
$
|
607,783
|
||||||||||
|
||||||||||||||||||||
Long-term debt, excluding current portion
|
$
|
277
|
$
|
7,576
|
$
|
7,931
|
$
|
29,937
|
$
|
46,917
|
||||||||||
Total debt
|
$
|
7,774
|
$
|
8,089
|
$
|
9,760
|
$
|
35,057
|
$
|
47,983
|
||||||||||
Total equity
|
$
|
529,718
|
$
|
491,968
|
$
|
447,815
|
$
|
364,140
|
$
|
343,114
|
||||||||||
Debt to equity ratio
(4)
|
1.5
|
%
|
1.6
|
%
|
2.2
|
%
|
9.6
|
%
|
14.0
|
%
|
||||||||||
Debt to capitalization ratio
(5)
|
1.4
|
%
|
1.6
|
%
|
2.1
|
%
|
8.8
|
%
|
12.3
|
%
|
||||||||||
|
||||||||||||||||||||
Shareholders
|
13,900
|
12,400
|
13,900
|
13,900
|
17,400
|
|||||||||||||||
Employees
|
8,300
|
8,185
|
8,160
|
7,910
|
8,290
|
(Dollar amounts in thousands, except per share data)
|
(13 weeks)
|
(13 weeks)
|
(13 weeks)
|
(13 weeks)
|
||||||||||||
Fiscal Quarter Ended
|
7/27/2013
|
10/26/2013
|
1/25/2014
|
4/26/2014
|
||||||||||||
Sales
|
$
|
305,502
|
$
|
352,271
|
$
|
346,525
|
$
|
353,020
|
||||||||
Cost of sales
|
||||||||||||||||
Cost of goods sold
|
203,949
|
229,727
|
224,786
|
229,563
|
||||||||||||
Restructuring
|
87
|
(142
|
)
|
(60
|
)
|
4,954
|
||||||||||
Total cost of sales
|
204,036
|
229,585
|
224,726
|
234,517
|
||||||||||||
Gross profit
|
101,466
|
122,686
|
121,799
|
118,503
|
||||||||||||
Selling, general and administrative expense
|
86,701
|
96,568
|
95,915
|
95,974
|
||||||||||||
Operating income
|
14,765
|
26,118
|
25,884
|
22,529
|
||||||||||||
Interest expense
|
136
|
133
|
142
|
137
|
||||||||||||
Interest income
|
180
|
176
|
183
|
222
|
||||||||||||
Other income (expense), net
|
537
|
(279
|
)
|
849
|
943
|
|||||||||||
Income from continuing operations before income taxes
|
15,346
|
25,882
|
26,774
|
23,557
|
||||||||||||
Income tax expense
|
5,445
|
8,425
|
8,916
|
8,597
|
||||||||||||
Income from continuing operations
|
9,901
|
17,457
|
17,858
|
14,960
|
||||||||||||
Income (loss) from discontinued operations, net of tax
|
34
|
(440
|
)
|
(987
|
)
|
(2,403
|
)
|
|||||||||
Net income
|
9,935
|
17,017
|
16,871
|
12,557
|
||||||||||||
Net income attributable to noncontrolling interests
|
(345
|
)
|
(273
|
)
|
(388
|
)
|
(318
|
)
|
||||||||
Net income attributable to La-Z-Boy Incorporated
|
$
|
9,590
|
$
|
16,744
|
$
|
16,483
|
$
|
12,239
|
||||||||
|
||||||||||||||||
Net income attributable to La-Z-Boy Incorporated:
|
||||||||||||||||
Income from continuing operations attributable to La-Z-Boy Incorporated
|
$
|
9,556
|
$
|
17,184
|
$
|
17,470
|
$
|
14,642
|
||||||||
Income (loss) from discontinued operations
|
34
|
(440
|
)
|
(987
|
)
|
(2,403
|
)
|
|||||||||
Net income attributable to La-Z-Boy Incorporated
|
$
|
9,590
|
$
|
16,744
|
$
|
16,483
|
$
|
12,239
|
||||||||
|
||||||||||||||||
Diluted weighted average shares
|
53,051
|
53,261
|
53,226
|
53,519
|
||||||||||||
|
||||||||||||||||
Diluted net income attributable to La-Z-Boy Incorporated per share:
|
||||||||||||||||
Income from continuing operations attributable to La-Z-Boy Incorporated
|
$
|
0.18
|
$
|
0.32
|
$
|
0.33
|
$
|
0.27
|
||||||||
Loss from discontinued operations
|
—
|
(0.01
|
)
|
(0.02
|
)
|
(0.04
|
)
|
|||||||||
Diluted net income attributable to La-Z-Boy Incorporated per share
|
$
|
0.18
|
$
|
0.31
|
$
|
0.31
|
$
|
0.23
|
||||||||
|
||||||||||||||||
Dividends declared per share
|
$
|
0.04
|
$
|
0.04
|
$
|
0.06
|
$
|
0.06
|
(Dollar amounts in thousands, except per share data)
|
(13 weeks)
|
(13 weeks)
|
(13 weeks)
|
(13 weeks)
|
||||||||||||
Fiscal Quarter Ended
|
7/28/2012
|
10/27/2012
|
1/26/2013
|
4/27/2013
|
||||||||||||
Sales
|
$
|
286,598
|
$
|
306,523
|
$
|
334,916
|
$
|
345,840
|
||||||||
Cost of sales
|
||||||||||||||||
Cost of goods sold
|
199,156
|
206,252
|
223,680
|
225,454
|
||||||||||||
Restructuring
|
—
|
2,509
|
—
|
(29
|
)
|
|||||||||||
Total cost of sales
|
199,156
|
208,761
|
223,680
|
225,425
|
||||||||||||
Gross profit
|
87,442
|
97,762
|
111,236
|
120,415
|
||||||||||||
Selling, general and administrative expense
|
79,950
|
87,437
|
88,448
|
93,266
|
||||||||||||
Restructuring
|
31
|
62
|
30
|
28
|
||||||||||||
Operating income
|
7,461
|
10,263
|
22,758
|
27,121
|
||||||||||||
Interest expense
|
173
|
191
|
148
|
234
|
||||||||||||
Interest income
|
121
|
116
|
197
|
186
|
||||||||||||
Other income (expense), net
|
(99
|
)
|
212
|
2,403
|
692
|
|||||||||||
Income from continuing operations before income taxes
|
7,310
|
10,400
|
25,210
|
27,765
|
||||||||||||
Income tax expense
|
2,704
|
3,755
|
8,371
|
8,690
|
||||||||||||
Income from continuing operations
|
4,606
|
6,645
|
16,839
|
19,075
|
||||||||||||
Income (loss) from discontinued operations, net of tax
|
89
|
187
|
324
|
(583
|
)
|
|||||||||||
Net income
|
4,695
|
6,832
|
17,163
|
18,492
|
||||||||||||
Net income attributable to noncontrolling interests
|
(297
|
)
|
(213
|
)
|
(99
|
)
|
(184
|
)
|
||||||||
Net income attributable to La-Z-Boy Incorporated
|
$
|
4,398
|
$
|
6,619
|
$
|
17,064
|
$
|
18,308
|
||||||||
|
||||||||||||||||
Net income attributable to La-Z-Boy Incorporated:
|
||||||||||||||||
Income from continuing operations attributable to La-Z-Boy Incorporated
|
$
|
4,309
|
$
|
6,432
|
$
|
16,740
|
$
|
18,891
|
||||||||
Income (loss) from discontinued operations
|
89
|
187
|
324
|
(583
|
)
|
|||||||||||
Net income attributable to La-Z-Boy Incorporated
|
$
|
4,398
|
$
|
6,619
|
$
|
17,064
|
$
|
18,308
|
||||||||
|
||||||||||||||||
Diluted weighted average shares
|
53,040
|
53,268
|
53,401
|
53,754
|
||||||||||||
|
||||||||||||||||
Diluted net income attributable to La-Z-Boy Incorporated per share:
|
||||||||||||||||
Income from continuing operations attributable to La-Z-Boy Incorporated
|
$
|
0.08
|
$
|
0.12
|
$
|
0.31
|
$
|
0.34
|
||||||||
Income (loss) from discontinued operations
|
—
|
—
|
0.01
|
(0.01
|
)
|
|||||||||||
Diluted net income attributable to La-Z-Boy Incorporated per share
|
$
|
0.08
|
$
|
0.12
|
$
|
0.32
|
$
|
0.33
|
||||||||
|
||||||||||||||||
Dividends declared per share
|
$
|
—
|
$
|
—
|
$
|
0.04
|
$
|
0.04
|
· | Upholstery Segment . Our Upholstery segment is our largest segment in revenue, and consists of two operating units: La-Z-Boy, our largest operating unit, and our England subsidiary. Our Upholstery segment manufactures or imports upholstered furniture such as recliners and motion furniture, sofas, loveseats, chairs, sectionals, modulars, ottomans and sleeper sofas. This segment sells directly to La-Z-Boy Furniture Galleries® stores, operators of Comfort Studios® locations, major dealers and other independent retailers. |
· | Casegoods Segment . Our Casegoods segment is an importer, marketer, manufacturer and distributor of casegoods (wood) furniture such as bedroom sets, dining room sets, entertainment centers, occasional pieces, and some coordinated upholstered furniture. The Casegoods segment consists of three brands: American Drew, Hammary, and Kincaid. The Casegoods segment sells primarily to major dealers and other independent retailers. |
· | Retail Segment . Our Retail segment consists of 101 company-owned La-Z-Boy Furniture Galleries® stores located in 12 markets ranging from southern California to the Midwest to the East Coast. The Retail segment primarily sells upholstered furniture, in addition to some casegoods and other accessories, to the end consumer through our retail network. |
(Amounts in thousands, except percentages)
|
(52 weeks)
4/26/2014
|
(52 weeks)
4/27/2013
|
Percent
Change
|
|||||||||
Consolidated sales
|
$
|
1,357,318
|
$
|
1,273,877
|
6.6
|
%
|
||||||
Consolidated operating income
|
89,296
|
67,603
|
32.1
|
%
|
||||||||
Consolidated operating margin
|
6.6
|
%
|
5.3
|
%
|
· | Our gross margin increased 1.5 percentage points in fiscal 2014 as compared to fiscal 2013. Our consolidated gross margin increased due in part to fiscal 2014’s higher weighting of sales in our Retail segment, which carry a higher gross margin than our wholesale segments. Gross margin in our Upholstery segment benefited from favorable absorption of fixed costs resulting from sales volume increases. Our Retail segment’s gross margin improved as a result of improved merchandising and a higher priced product mix. |
· | Selling, General, and Administrative (“SG&A”) expenses increased in absolute dollars in fiscal 2014 as compared to fiscal 2013, and increased as a percentage of sales by 0.2 percentage point in fiscal 2014 as compared to fiscal 2013. |
o | Advertising costs were 0.2 percentage point higher in fiscal 2014 than fiscal 2013, due primarily to increased spending related to our Live Life Comfortably marketing campaign, and incentive compensation costs were 0.2 percentage point higher in fiscal 2014 as compared to fiscal 2013. The main drivers of the increase in incentive compensation costs during fiscal 2014 were the improvement in our consolidated financial performance and the increase in our share price during the period. Several of our share-based compensation awards are liability-based and/or performance-based awards, and their cumulative expense to date is adjusted at the end of each period based on the share price on the last day of the reporting period and the ultimate amount of awards expected to vest. These items were partly offset by a reduction in the provision for doubtful accounts of 0.3 percentage point, due to the continued improvement in the financial health of our customer base, especially our independent La-Z-Boy Furniture Galleries® dealers. |
(Amounts in thousands, except percentages)
|
(52 weeks)
4/26/2014
|
(52 weeks)
4/27/2013
|
Percent
Change
|
|||||||||
Sales
|
$
|
1,099,050
|
$
|
1,029,765
|
6.7
|
%
|
||||||
Operating income
|
117,688
|
95,571
|
23.1
|
%
|
||||||||
Operating margin
|
10.7
|
%
|
9.3
|
%
|
· | The segment’s gross margin increased 1.4 percentage points during fiscal 2014 compared to the fiscal 2013 due to a combination of factors. Higher unit volume, selling price, product mix changes, and operational efficiencies amounted to a 2.1 percentage points benefit. These items more than offset the impact of raw material cost increases of 0.8 percentage point. |
· | The segment’s SG&A expense as a percentage of sales was flat in fiscal 2014 as compared to fiscal 2013. Our sales increase led to improved absorption of fixed costs and we reduced the provision for doubtful accounts by $3.8 million, or 0.4 percentage point, due to the continued improvement in the financial condition of our customer base, especially our independent La-Z-Boy Furniture Galleries® dealers. These items, however, were offset by the impact of higher incentive compensation costs and advertising costs of 0.2 percentage point. |
(Amounts in thousands, except percentages)
|
(52 weeks)
4/26/2014
|
(52 weeks)
4/27/2013
|
Percent
Change
|
|||||||||
Sales
|
$
|
106,752
|
$
|
112,527
|
(5.1
|
)%
|
||||||
Operating income
|
3,397
|
3,703
|
(8.3
|
)%
|
||||||||
Operating margin
|
3.2
|
%
|
3.3
|
%
|
(Amounts in thousands, except percentages)
|
(52 weeks)
4/26/2014
|
(52 weeks)
4/27/2013
|
Percent
Change
|
|||||||||
Sales
|
$
|
298,642
|
$
|
264,723
|
12.8
|
%
|
||||||
Operating income
|
11,128
|
4,099
|
171.5
|
%
|
||||||||
Operating margin
|
3.7
|
%
|
1.5
|
%
|
· | The segment’s gross margin improved 1.0 percentage point in fiscal 2014 compared to fiscal 2013, benefitting from better product merchandising. |
· | The segment’s SG&A costs as a percent of sales improved 1.2 percentage points in fiscal 2014. |
o | Our sales increase allowed us to reduce our fixed SG&A expenses (primarily occupancy and administrative costs) as a percentage of sales. |
o | We incurred additional costs during the year, however, in acquiring stores and building and opening new stores. Our 4-4-5 program, through which we expect to expand the La-Z-Boy Furniture Galleries® stores network to 400 stores averaging $4 million in sales per store over the five year period that began with fiscal 2014, is a key growth strategy for our company, which we expect will result in growth in our Retail segment through increased company-owned store count. As we execute this strategy over the next few years, we will incur SG&A expense for items such as pre-opening rent, staffing, and technology-related expenses. During fiscal 2014, we acquired five existing La-Z-Boy Furniture Galleries® stores, opened five new stores and remodeled one existing store to our new concept design format. The associated costs of these activities, as well as other new store construction and remodel projects that are in the pipeline for fiscal 2015, increased our SG&A costs as a percentage of sales. |
(Amounts in thousands, except percentages)
|
(52 weeks)
4/26/2014
|
(52 weeks)
4/27/2013
|
Percent
Change
|
|||||||||
Sales:
|
|
|
|
|||||||||
Corporate and Other
|
2,463
|
2,313
|
6.5
|
%
|
||||||||
Eliminations
|
(149,589
|
)
|
(135,451
|
)
|
(10.4
|
)%
|
||||||
|
||||||||||||
Operating loss:
|
||||||||||||
Restructuring
|
(4,839
|
)
|
(2,631
|
)
|
N/
|
M
|
||||||
Corporate and Other
|
(38,078
|
)
|
(33,139
|
)
|
(14.9
|
)%
|
||||||
N/M – Not Meaningful
|
(Amounts in thousands, except percentages)
|
(52 weeks)
4/27/2013
|
(52 weeks)
4/28/2012
|
Percent
Change
|
|||||||||
Consolidated sales
|
$
|
1,273,877
|
$
|
1,166,705
|
9.2
|
%
|
||||||
Consolidated operating income
|
67,603
|
48,697
|
38.8
|
%
|
||||||||
Consolidated operating margin
|
5.3
|
%
|
4.2
|
%
|
· | Our gross margin increased 0.9 percentage point in fiscal 2013 as compared to fiscal 2012. |
o | Our Retail segment increase in gross margin was a result of mix, merchandising, and price. |
o | We also saw favorable absorption of fixed costs resulting from sales volume increases in our Upholstery segment. |
o | These improvements were partially offset by 0.2 percentage point of restructuring charges recorded during fiscal 2013, which mainly related to fixed asset and inventory write-downs associated with the closure of our lumber processing operation for our Casegoods segment during the second quarter of fiscal 2013. |
· | Selling, General, and Administrative (“SG&A”) expenses increased in dollars in fiscal 2013 as compared to fiscal 2012, but have decreased 0.2 percentage point in fiscal 2013 as compared to fiscal 2012. |
o | Increased sales resulted in favorable absorption of fixed costs. |
o | Offsetting the favorable fixed cost absorption was $8.6 million of additional incentive compensation expense in fiscal 2013 across all segments, or an increase of 0.6 percentage point. This increase in incentive compensation was due to our continued improvements in sales and operating results for the full fiscal year. As a result, we had three outstanding performance-based stock awards, each with three-year performance measurement periods, for which we were recognizing expense during fiscal 2013. |
(Amounts in thousands, except percentages)
|
(52 weeks)
4/27/2013
|
(52 weeks)
4/28/2012
|
Percent
Change
|
|||||||||
Sales
|
$
|
1,029,765
|
$
|
938,060
|
9.8
|
%
|
||||||
Operating income
|
95,571
|
81,015
|
18.0
|
%
|
||||||||
Operating margin
|
9.3
|
%
|
8.6
|
%
|
· | The segment’s gross margin increased 0.9 percentage point during fiscal 2013 due to a combination of factors, the most significant of which were: |
o | Selling price changes as well as changes in product mix resulted in a 1.6 percentage points increase in gross margin. |
o | Raw material cost increases resulted in a 1.1 percentage points decrease in gross margin. |
· | The segment’s SG&A as a percentage of sales increased 0.2 percentage point, mainly due to higher incentive compensation expense in fiscal 2013, as well as increased costs related to our ERP implementation. These increased costs were partially offset by favorable absorption of fixed costs resulting from our sales volume increase. |
(Amounts in thousands, except percentages)
|
(52 weeks)
4/27/2013
|
(52 weeks)
4/28/2012
|
Percent
Change
|
|||||||||
Sales
|
$
|
112,527
|
$
|
111,657
|
0.8
|
%
|
||||||
Operating income
|
3,703
|
5,396
|
(31.4
|
)%
|
||||||||
Operating margin
|
3.3
|
%
|
4.8
|
%
|
· | The segment’s gross margin decreased 0.5 percentage point in fiscal 2013 compared to fiscal 2012. Gross margin was reduced by 1.3 percentage points due to a charge taken in the third quarter of fiscal 2013 for an adjustment to our import duties, combined with a decline in volume which resulted in an inability to absorb fixed costs. Partially offsetting these declines was an increase in gross margin due to a shift to a larger mix of sales of occasional furniture, which carry better margins. |
· | The segment’s SG&A as a percentage of sales increased 1.0 percentage point during fiscal 2013 compared to fiscal 2012, due mainly to higher incentive compensation costs, which were driven by equity-based awards and consolidated financial performance. |
(Amounts in thousands, except percentages)
|
(52 weeks)
4/27/2013
|
(52 weeks)
4/28/2012
|
Percent
Change
|
|||||||||
Sales
|
$
|
264,723
|
$
|
215,490
|
22.8
|
%
|
||||||
Operating income (loss)
|
4,099
|
(7,819
|
)
|
152.4
|
%
|
|||||||
Operating margin
|
1.5
|
%
|
(3.6
|
)%
|
· | The segment’s gross margin benefitted from selling price increases, differentiated product merchandising, and lower promotional activity. |
· | Increased sales volume contributed to a higher operating margin, through greater leverage of SG&A expenses as a percentage of sales. |
(Amounts in thousands, except percentages)
|
(52 weeks)
4/27/2013
|
(52 weeks)
4/28/2012
|
Percent
Change
|
|||||||||
Sales
|
|
|
|
|||||||||
VIEs, net of intercompany sales eliminations
|
$
|
—
|
$
|
8,840
|
N/
|
M
|
||||||
Corporate and Other
|
2,313
|
2,356
|
(1.8
|
)%
|
||||||||
Eliminations
|
(135,451
|
)
|
(109,698
|
)
|
(23.5
|
)%
|
||||||
|
||||||||||||
Operating income (loss)
|
||||||||||||
VIEs
|
—
|
959
|
N/
|
M
|
||||||||
Restructuring
|
(2,631
|
)
|
(281
|
)
|
N/
|
M
|
||||||
Corporate and Other
|
(33,139
|
)
|
(30,573
|
)
|
(8.4
|
)%
|
||||||
N/M – Not Meaningful
|
|
Year Ended
|
|||||||
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Cash Flows Provided By (Used For)
|
|
|
||||||
Net cash provided by operating activities
|
$
|
90,832
|
$
|
68,440
|
||||
Net cash used for investing activities
|
(45,016
|
)
|
(78,041
|
)
|
||||
Net cash used for financing activities
|
(26,690
|
)
|
(11,616
|
)
|
||||
Exchange rate changes
|
(550
|
)
|
(68
|
)
|
||||
Change in cash and equivalents
|
$
|
18,576
|
$
|
(21,285
|
)
|
|
|
Payments Due by Period
|
||||||||||||||||||
(Amounts in thousands)
|
Total
|
Less than
1 Year
|
1-3 Years
|
4-5 Years
|
More than
5 Years
|
|||||||||||||||
Debt obligations
|
$
|
7,100
|
$
|
7,100
|
$
|
—
|
$
|
—
|
$
|
—
|
||||||||||
Capital lease obligations
|
674
|
397
|
277
|
—
|
—
|
|||||||||||||||
Operating lease obligations
|
339,379
|
51,972
|
94,279
|
81,264
|
111,864
|
|||||||||||||||
Interest obligations
|
1
|
1
|
—
|
—
|
—
|
|||||||||||||||
Purchase obligations*
|
100,898
|
100,898
|
—
|
—
|
—
|
|||||||||||||||
Total contractual obligations
|
$
|
448,052
|
$
|
160,368
|
$
|
94,556
|
$
|
81,264
|
$
|
111,864
|
|
Fiscal Year Ended
|
|||||||||||
(Amounts in thousands, except per share data)
|
(52 weeks)
4/26/2014
|
(52 weeks)
4/27/2013
|
(52 weeks)
4/28/2012
|
|||||||||
Sales
|
$
|
1,357,318
|
$
|
1,273,877
|
$
|
1,166,705
|
||||||
Cost of sales
|
||||||||||||
Cost of goods sold
|
888,025
|
854,542
|
795,957
|
|||||||||
Restructuring
|
4,839
|
2,480
|
13
|
|||||||||
Total cost of sales
|
892,864
|
857,022
|
795,970
|
|||||||||
Gross profit
|
464,454
|
416,855
|
370,735
|
|||||||||
Selling, general and administrative expense
|
375,158
|
349,101
|
321,770
|
|||||||||
Restructuring
|
—
|
151
|
268
|
|||||||||
Operating income
|
89,296
|
67,603
|
48,697
|
|||||||||
Interest expense
|
548
|
746
|
1,384
|
|||||||||
Interest income
|
761
|
620
|
609
|
|||||||||
Income from Continued Dumping and Subsidy Offset Act, net
|
—
|
—
|
11,066
|
|||||||||
Other income (expense), net
|
2,050
|
3,208
|
(38
|
)
|
||||||||
Income from continuing operations before income taxes
|
91,559
|
70,685
|
58,950
|
|||||||||
Income tax expense (benefit)
|
31,383
|
23,520
|
(25,052
|
)
|
||||||||
Income from continuing operations
|
60,176
|
47,165
|
84,002
|
|||||||||
Income (loss) from discontinued operations, net of tax
|
(3,796
|
)
|
17
|
4,906
|
||||||||
Net income
|
56,380
|
47,182
|
88,908
|
|||||||||
Net income attributable to noncontrolling interests
|
(1,324
|
)
|
(793
|
)
|
(942
|
)
|
||||||
Net income attributable to La-Z-Boy Incorporated
|
$
|
55,056
|
$
|
46,389
|
$
|
87,966
|
|
Fiscal Year Ended
|
|||||||||||
(Amounts in thousands, except per share data)
|
(52 weeks)
4/26/2014
|
(52 weeks)
4/27/2013
|
(52 weeks)
4/28/2012
|
|||||||||
Net income attributable to La-Z-Boy Incorporated:
|
|
|
|
|||||||||
Income from continuing operations attributable to La-Z-Boy Incorporated
|
$
|
58,852
|
$
|
46,372
|
$
|
83,060
|
||||||
Income (loss) from discontinued operations
|
(3,796
|
)
|
17
|
4,906
|
||||||||
Net income attributable to La-Z-Boy Incorporated
|
$
|
55,056
|
$
|
46,389
|
$
|
87,966
|
||||||
|
||||||||||||
Basic average shares
|
52,386
|
52,351
|
51,944
|
|||||||||
|
||||||||||||
Basic net income attributable to La-Z-Boy Incorporated per share:
|
||||||||||||
Income from continuing operations attributable to La-Z-Boy Incorporated
|
$
|
1.11
|
$
|
0.87
|
$
|
1.57
|
||||||
Income (loss) from discontinued operations, net of tax
|
(0.07
|
)
|
—
|
0.09
|
||||||||
Basic net income attributable to La-Z-Boy Incorporated per share
|
$
|
1.04
|
$
|
0.87
|
$
|
1.66
|
||||||
|
||||||||||||
Diluted average shares
|
53,829
|
53,685
|
52,478
|
|||||||||
|
||||||||||||
Diluted net income attributable to La-Z-Boy Incorporated per share:
|
||||||||||||
Income from continuing operations attributable to La-Z-Boy Incorporated
|
$
|
1.09
|
$
|
0.85
|
$
|
1.55
|
||||||
Income (loss) from discontinued operations, net of tax
|
(0.07
|
)
|
—
|
0.09
|
||||||||
Diluted net income attributable to La-Z-Boy Incorporated per share
|
$
|
1.02
|
$
|
0.85
|
$
|
1.64
|
||||||
|
||||||||||||
Dividends declared per share
|
$
|
0.20
|
$
|
0.08
|
$
|
—
|
||||||
|
|
Fiscal Year Ended
|
|||||||||||
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Net income
|
$
|
56,380
|
$
|
47,182
|
$
|
88,908
|
||||||
Other comprehensive income (loss)
|
||||||||||||
Currency translation adjustment
|
(3,054
|
)
|
1,089
|
(132
|
)
|
|||||||
Change in fair value of cash flow hedges, net of tax
|
(284
|
)
|
231
|
28
|
||||||||
Net unrealized gains (losses) on marketable securities, net of tax
|
624
|
(2,543
|
)
|
(331
|
)
|
|||||||
Net pension amortization and actuarial gain (loss), net of tax
|
6,100
|
(2,653
|
)
|
(12,209
|
)
|
|||||||
Total other comprehensive income (loss)
|
3,386
|
(3,876
|
)
|
(12,644
|
)
|
|||||||
Total comprehensive income before allocation to noncontrolling interests
|
59,766
|
43,306
|
76,264
|
|||||||||
Comprehensive income attributable to noncontrolling interests
|
(594
|
)
|
(1,132
|
)
|
(775
|
)
|
||||||
Comprehensive income attributable to La-Z-Boy Incorporated
|
$
|
59,172
|
$
|
42,174
|
$
|
75,489
|
|
As of
|
|||||||
(Amounts in thousands, except par value)
|
4/26/2014
|
4/27/2013
|
||||||
Current assets
|
|
|
||||||
Cash and equivalents
|
$
|
149,661
|
$
|
131,085
|
||||
Restricted cash
|
12,572
|
12,686
|
||||||
Receivables, net of allowance of $12,368 at 4/26/14 and $21,607 at 4/27/13
|
152,614
|
160,005
|
||||||
Inventories, net
|
147,009
|
146,343
|
||||||
Deferred income taxes – current
|
15,037
|
20,640
|
||||||
Business held for sale
|
4,290
|
—
|
||||||
Other current assets
|
41,490
|
30,121
|
||||||
Total current assets
|
522,673
|
500,880
|
||||||
Property, plant and equipment, net
|
127,535
|
118,060
|
||||||
Goodwill
|
13,923
|
12,837
|
||||||
Other intangible assets
|
4,544
|
4,838
|
||||||
Deferred income taxes – long-term
|
32,430
|
30,572
|
||||||
Other long-term assets, net
|
70,190
|
53,184
|
||||||
Total assets
|
$
|
771,295
|
$
|
720,371
|
||||
|
||||||||
Current liabilities
|
||||||||
Current portion of long-term debt
|
$
|
7,497
|
$
|
513
|
||||
Accounts payable
|
56,177
|
50,542
|
||||||
Business held for sale
|
832
|
—
|
||||||
Accrued expenses and other current liabilities
|
102,876
|
99,108
|
||||||
Total current liabilities
|
167,382
|
150,163
|
||||||
Long-term debt
|
277
|
7,576
|
||||||
Other long-term liabilities
|
73,918
|
70,664
|
||||||
Contingencies and commitments
|
—
|
—
|
||||||
Shareholders' equity
|
||||||||
Preferred shares – 5,000 authorized; none issued
|
—
|
—
|
||||||
Common shares, $1 par value – 150,000 authorized; 51,981 outstanding at 4/26/14 and 52,392 outstanding at 4/27/13
|
51,981
|
52,392
|
||||||
Capital in excess of par value
|
262,901
|
241,888
|
||||||
Retained earnings
|
238,384
|
226,044
|
||||||
Accumulated other comprehensive loss
|
(31,380
|
)
|
(35,496
|
)
|
||||
Total La-Z-Boy Incorporated shareholders’ equity
|
521,886
|
484,828
|
||||||
Noncontrolling interests
|
7,832
|
7,140
|
||||||
Total equity
|
529,718
|
491,968
|
||||||
Total liabilities and equity
|
$
|
771,295
|
$
|
720,371
|
|
Fiscal Year Ended
|
|||||||||||
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Cash flows from operating activities
|
|
|
|
|||||||||
Net income
|
$
|
56,380
|
$
|
47,182
|
$
|
88,908
|
||||||
Adjustments to reconcile net income to cash provided by operating activities
|
||||||||||||
(Gain) loss on disposal of assets
|
616
|
(659
|
)
|
45
|
||||||||
Gain on sale of investments
|
(300
|
)
|
(3,170
|
)
|
(519
|
)
|
||||||
Gain on deconsolidation of VIE
|
—
|
—
|
(1,125
|
)
|
||||||||
Write-down of long-lived assets
|
1,149
|
—
|
—
|
|||||||||
Deferred income tax expense (benefit)
|
(216
|
)
|
3,198
|
(42,146
|
)
|
|||||||
Restructuring
|
8,071
|
2,715
|
281
|
|||||||||
Provision for doubtful accounts
|
(2,651
|
)
|
1,005
|
4,196
|
||||||||
Depreciation and amortization
|
23,182
|
23,140
|
23,486
|
|||||||||
Stock-based compensation expense
|
8,739
|
11,458
|
5,718
|
|||||||||
Pension plan contributions
|
—
|
(23,480
|
)
|
(5,798
|
)
|
|||||||
Change in receivables
|
3,337
|
7,139
|
(6,182
|
)
|
||||||||
Change in inventories
|
(9,444
|
)
|
391
|
(7,414
|
)
|
|||||||
Change in other assets
|
(2,958
|
)
|
(5,407
|
)
|
3,318
|
|||||||
Change in accounts payable
|
1,704
|
(6,088
|
)
|
7,470
|
||||||||
Change in other liabilities
|
3,223
|
11,016
|
12,610
|
|||||||||
Net cash provided by operating activities
|
90,832
|
68,440
|
82,848
|
|||||||||
Cash flows from investing activities
|
||||||||||||
Proceeds from disposals of assets
|
2,233
|
4,455
|
372
|
|||||||||
Proceeds from sale of business
|
6,844
|
—
|
—
|
|||||||||
Capital expenditures
|
(33,730
|
)
|
(25,912
|
)
|
(15,663
|
)
|
||||||
Purchases of investments
|
(54,233
|
)
|
(49,589
|
)
|
(7,944
|
)
|
||||||
Proceeds from sales of investments
|
34,557
|
18,662
|
8,649
|
|||||||||
Cash effects on deconsolidation of VIE
|
—
|
—
|
(971
|
)
|
||||||||
Acquisitions, net of cash acquired
|
(801
|
)
|
(15,832
|
)
|
—
|
|||||||
Change in restricted cash
|
114
|
(9,825
|
)
|
(2,861
|
)
|
|||||||
Other
|
—
|
—
|
(676
|
)
|
||||||||
Net cash used for investing activities
|
(45,016
|
)
|
(78,041
|
)
|
(19,094
|
)
|
||||||
Cash flows from financing activities
|
||||||||||||
Payments on debt
|
(579
|
)
|
(2,511
|
)
|
(25,936
|
)
|
||||||
Payments for debt issuance costs
|
—
|
—
|
(568
|
)
|
||||||||
Stock issued for stock and employee benefit plans
|
3,565
|
2,901
|
4,943
|
|||||||||
Excess tax benefit on stock option exercises
|
12,935
|
2,563
|
223
|
|||||||||
Purchases of common stock
|
(32,097
|
)
|
(10,333
|
)
|
(5,179
|
)
|
||||||
Dividends paid
|
(10,514
|
)
|
(4,236
|
)
|
—
|
|||||||
Net cash used for financing activities
|
(26,690
|
)
|
(11,616
|
)
|
(26,517
|
)
|
||||||
Effect of exchange rate changes on cash and equivalents
|
(550
|
)
|
(68
|
)
|
(129
|
)
|
||||||
Change in cash and equivalents
|
18,576
|
(21,285
|
)
|
37,108
|
||||||||
Cash and equivalents at beginning of period
|
131,085
|
152,370
|
115,262
|
|||||||||
Cash and equivalents at end of period
|
$
|
149,661
|
$
|
131,085
|
$
|
152,370
|
||||||
Supplemental disclosure of non-cash investing activities
|
||||||||||||
Capital expenditures included in accounts payable
|
$
|
5,303
|
$
|
—
|
$
|
—
|
(Amounts in thousands)
|
Common
Shares
|
Capital in
Excess of Par
Value
|
Retained
Earnings
|
Accumulated Other
Comprehensive
Income (Loss)
|
Non-
Controlling
Interests
|
Total
|
||||||||||||||||||
At April 30, 2011
|
$
|
51,909
|
$
|
222,339
|
$
|
105,872
|
$
|
(18,804
|
)
|
$
|
2,824
|
$
|
364,140
|
|||||||||||
Net income
|
87,966
|
942
|
88,908
|
|||||||||||||||||||||
Other comprehensive loss
|
(12,477
|
)
|
(167
|
)
|
(12,644
|
)
|
||||||||||||||||||
Stock issued for stock and employee benefit plans, net of cancellations
|
835
|
4,011
|
(509
|
)
|
4,337
|
|||||||||||||||||||
Purchases of common stock
|
(500
|
)
|
(958
|
)
|
(3,721
|
)
|
(5,179
|
)
|
||||||||||||||||
Stock option and restricted stock expense
|
5,717
|
1
|
5,718
|
|||||||||||||||||||||
Tax benefit from exercise of options
|
223
|
223
|
||||||||||||||||||||||
Changes in noncontrolling interest upon deconsolidation of VIE and other changes in noncontrolling interests
|
2,312
|
2,312
|
||||||||||||||||||||||
At April 28, 2012
|
52,244
|
231,332
|
189,609
|
(31,281
|
)
|
5,911
|
447,815
|
|||||||||||||||||
Net income
|
46,389
|
793
|
47,182
|
|||||||||||||||||||||
Other comprehensive income (loss)
|
(4,215
|
)
|
339
|
(3,876
|
)
|
|||||||||||||||||||
Stock issued for stock and employee benefit plans, net of cancellations
|
817
|
1,849
|
(1,368
|
)
|
1,298
|
|||||||||||||||||||
Purchases of common stock
|
(669
|
)
|
(5,314
|
)
|
(4,350
|
)
|
(10,333
|
)
|
||||||||||||||||
Stock option and restricted stock expense
|
11,458
|
11,458
|
||||||||||||||||||||||
Tax benefit from exercise of options
|
2,563
|
2,563
|
||||||||||||||||||||||
Dividends paid
|
(4,236
|
)
|
(4,236
|
)
|
||||||||||||||||||||
Change in noncontrolling interests
|
97
|
97
|
||||||||||||||||||||||
At April 27, 2013
|
52,392
|
241,888
|
226,044
|
(35,496
|
)
|
7,140
|
491,968
|
|||||||||||||||||
Net income
|
55,056
|
1,324
|
56,380
|
|||||||||||||||||||||
Other comprehensive income (loss)
|
4,116
|
(730
|
)
|
3,386
|
||||||||||||||||||||
Stock issued for stock and employee benefit plans, net of cancellations
|
937
|
2,395
|
(4,509
|
)
|
(1,177
|
)
|
||||||||||||||||||
Purchases of common stock
|
(1,348
|
)
|
(3,056
|
)
|
(27,693
|
)
|
(32,097
|
)
|
||||||||||||||||
Stock option and restricted stock expense
|
8,739
|
8,739
|
||||||||||||||||||||||
Tax benefit from exercise of options
|
12,935
|
12,935
|
||||||||||||||||||||||
Dividends paid
|
(10,514
|
)
|
(10,514
|
)
|
||||||||||||||||||||
Change in noncontrolling interests
|
98
|
98
|
||||||||||||||||||||||
At April 26, 2014
|
$
|
51,981
|
$
|
262,901
|
$
|
238,384
|
$
|
(31,380
|
)
|
$
|
7,832
|
$
|
529,718
|
|
As of
|
|||
(Amounts in thousands)
|
10/1/12
|
|||
Current assets
|
$
|
4,260
|
||
Goodwill
|
12,837
|
|||
Other intangible assets
|
2,145
|
|||
Property, plant, and equipment, net
|
336
|
|||
Total assets acquired
|
19,578
|
|||
|
||||
Current liabilities
|
(2,199
|
)
|
||
|
||||
Net assets acquired
|
$
|
17,379
|
(Amounts in thousands)
|
4/26/14
|
|||
Fixed asset write-downs
|
$
|
2,272
|
||
Inventory write-downs
|
2,216
|
|||
Other
|
351
|
|||
Total restructuring - continuing operations
|
4,839
|
|||
|
||||
Inventory write-downs
|
1,804
|
|||
Tradename write-down
|
1,265
|
|||
Other
|
163
|
|||
Total restructuring - discontinued operations
|
3,232
|
|||
|
||||
Total restructuring expense
|
$
|
8,071
|
|
Year Ended
|
|||||||||||
(Amounts in thousands)
|
4/26/14
|
4/27/13
|
4/28/12
|
|||||||||
Net sales
|
$
|
33,608
|
$
|
37,282
|
$
|
37,043
|
||||||
|
||||||||||||
Income (loss) from discontinued operations (including impairment of $1.1 million in fiscal 2014)
|
$
|
(1,560
|
)
|
$
|
1,088
|
791
|
||||||
Income tax benefit/(expense)
|
541
|
(412
|
)
|
(303
|
)
|
|||||||
Income (loss) from discontinued operations, net of tax
|
$
|
(1,019
|
)
|
$
|
676
|
$
|
488
|
(Amounts in thousands)
|
4/26/14
|
|||
Assets
|
|
|||
Receivables, net
|
$
|
3,780
|
||
Inventories, net
|
4,231
|
|||
Other current assets
|
85
|
|||
Property, plant, and equipment, net
|
518
|
|||
Total assets
|
$
|
8,614
|
||
|
||||
Liabilities
|
||||
Accounts payable
|
$
|
1,290
|
||
Accrued expenses and other current liabilities
|
633
|
|||
Total liabilities
|
$
|
1,923
|
|
Year Ended
|
|||||||||||
(Amounts in thousands)
|
4/26/14
|
4/27/13
|
4/28/12
|
|||||||||
Net sales
|
$
|
16,979
|
$
|
21,366
|
$
|
27,928
|
||||||
|
||||||||||||
Income (loss) from discontinued operations (including restructuring of $3.3 million in fiscal 2014)
|
$
|
(4,472
|
)
|
$
|
(1,063
|
)
|
$
|
7,116
|
||||
Income tax benefit/(expense)
|
1,695
|
404
|
(2,698
|
)
|
||||||||
Income (loss) from discontinued operations, net of tax
|
$
|
(2,777
|
)
|
$
|
(659
|
)
|
$
|
4,418
|
(Amounts in thousands)
|
4/26/14
|
|||
Assets
|
|
|||
Receivables, net
|
$
|
1,190
|
||
Inventories, net
|
3,013
|
|||
Other current assets
|
87
|
|||
Total assets
|
$
|
4,290
|
||
|
||||
Liabilities
|
||||
Accounts payable
|
$
|
234
|
||
Accrued expenses and other current liabilities
|
576
|
|||
Other long-term liabilities
|
22
|
|||
Total liabilities
|
$
|
832
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Beginning balance
|
$
|
1,986
|
$
|
1,537
|
||||
Recoveries
|
—
|
(73
|
)
|
|||||
Write-offs
|
(1,888
|
)
|
—
|
|||||
Provision for credit losses
|
60
|
522
|
||||||
Ending balance
|
$
|
158
|
$
|
1,986
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Raw materials
|
$
|
71,247
|
$
|
70,731
|
||||
Work in process
|
13,722
|
12,182
|
||||||
Finished goods
|
91,842
|
93,273
|
||||||
FIFO inventories
|
176,811
|
176,186
|
||||||
Excess of FIFO over LIFO
|
(29,802
|
)
|
(29,843
|
)
|
||||
Total inventories
|
$
|
147,009
|
$
|
146,343
|
(Amounts in thousands)
|
Estimated
Useful
Lives
|
4/26/2014
|
4/27/2013
|
|||||||||
Buildings and building fixtures
|
3-40 years
|
$
|
161,490
|
$
|
171,346
|
|||||||
Machinery and equipment
|
3-15 years
|
140,561
|
141,924
|
|||||||||
Information systems and software
|
3-10 years
|
64,208
|
62,005
|
|||||||||
Land
|
—
|
15,344
|
18,433
|
|||||||||
Land improvements
|
3-30 years
|
10,820
|
10,772
|
|||||||||
Transportation equipment
|
3-10 years
|
17,420
|
17,855
|
|||||||||
Furniture and fixtures
|
3-15 years
|
14,104
|
14,204
|
|||||||||
Construction in progress
|
31,233
|
4,496
|
||||||||||
|
455,180
|
441,035
|
||||||||||
Accumulated depreciation
|
(327,645
|
)
|
(322,975
|
)
|
||||||||
Net property, plant and equipment
|
$
|
127,535
|
$
|
118,060
|
(Amounts in thousands)
|
Goodwill
|
|||
Balance at April 28, 2012
|
$
|
—
|
||
Acquisitions
|
12,837
|
|||
Balance at April 27, 2013
|
12,837
|
|||
Acquisitions
|
1,086
|
|||
Balance at April 26, 2014
|
$
|
13,923
|
(Amounts in thousands)
|
Tradenames
|
Reacquired
Rights
|
Total Other
Intangible
Assets
|
|||||||||
Balance at April 28, 2012
|
$
|
3,028
|
$
|
—
|
$
|
3,028
|
||||||
Acquisitions
|
—
|
2,145
|
2,145
|
|||||||||
Impairment charges
|
(335
|
)
|
—
|
(335
|
)
|
|||||||
Balance at April 27, 2013
|
2,693
|
2,145
|
4,838
|
|||||||||
Acquisitions
|
—
|
1,093
|
1,093
|
|||||||||
Restructuring
|
(1,265
|
)
|
—
|
(1,265
|
)
|
|||||||
Impairment charges
|
(122
|
)
|
—
|
(122
|
)
|
|||||||
Balance at April 26, 2014
|
$
|
1,306
|
$
|
3,238
|
$
|
4,544
|
Fiscal 2014
|
|
|
|
|||||||||
(Amounts in thousands)
|
Gross
Unrealized Gains
|
Gross
Unrealized Losses
|
Fair Value
|
|||||||||
Equity securities
|
$
|
1,246
|
$
|
(52
|
)
|
$
|
8,216
|
|||||
Fixed income
|
166
|
(44
|
)
|
50,510
|
||||||||
Mutual funds
|
—
|
—
|
1,787
|
|||||||||
Other
|
1
|
(10
|
)
|
425
|
||||||||
Total securities
|
$
|
1,413
|
$
|
(106
|
)
|
$
|
60,938
|
Fiscal 2013
|
|
|
|
|||||||||
(Amounts in thousands)
|
Gross
Unrealized Gains
|
Gross
Unrealized Losses
|
Fair Value
|
|||||||||
Equity securities
|
$
|
296
|
$
|
(152
|
)
|
$
|
6,668
|
|||||
Fixed income
|
159
|
(1
|
)
|
33,076
|
||||||||
Mutual funds
|
—
|
—
|
1,126
|
|||||||||
Other
|
(3
|
)
|
220
|
|||||||||
Total securities
|
$
|
456
|
$
|
(156
|
)
|
$
|
41,090
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Proceeds from sales
|
$
|
34,557
|
$
|
18,662
|
$
|
8,649
|
||||||
Gross realized gains
|
857
|
4,486
|
573
|
|||||||||
Gross realized losses
|
(559
|
)
|
(1,316
|
)
|
(54
|
)
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Payroll and other compensation
|
$
|
42,667
|
$
|
39,270
|
||||
Accrued product warranty, current portion
|
9,815
|
9,532
|
||||||
Customer deposits
|
20,903
|
15,852
|
||||||
Other current liabilities
|
29,491
|
34,454
|
||||||
Accrued expenses and other current liabilities
|
$
|
102,876
|
$
|
99,108
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Industrial revenue bonds
|
$
|
7,100
|
$
|
7,100
|
||||
Capital leases
|
674
|
989
|
||||||
Total debt
|
7,774
|
8,089
|
||||||
Less: current portion
|
(7,497
|
)
|
(513
|
)
|
||||
Long-term debt
|
$
|
277
|
$
|
7,576
|
(Amounts in thousands)
|
Future
Minimum
Rentals
|
Future
Minimum
Income
|
||||||
2015
|
$
|
51,972
|
$
|
4,077
|
||||
2016
|
48,464
|
4,123
|
||||||
2017
|
45,815
|
3,890
|
||||||
2018
|
42,720
|
3,830
|
||||||
2019
|
38,544
|
3,833
|
||||||
2020 and beyond
|
111,864
|
11,283
|
||||||
Total
|
$
|
339,379
|
$
|
31,036
|
||||
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Rental expense
|
$
|
51,132
|
$
|
47,872
|
$
|
48,168
|
||||||
Rental income
|
5,138
|
5,095
|
4,655
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Beginning of year net actuarial loss
|
$
|
48,745
|
$
|
45,270
|
||||
Net current year actuarial (gain) loss
|
(5,932
|
)
|
6,499
|
|||||
Amortization of actuarial loss
|
(3,388
|
)
|
(3,024
|
)
|
||||
End of year net actuarial loss
|
$
|
39,425
|
$
|
48,745
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Service cost
|
$
|
1,241
|
$
|
1,231
|
$
|
1,110
|
||||||
Interest cost
|
4,822
|
5,325
|
5,565
|
|||||||||
Expected return on plan assets
|
(6,800
|
)
|
(6,855
|
)
|
(6,820
|
)
|
||||||
Net amortization and deferral
|
3,388
|
3,024
|
1,635
|
|||||||||
Net periodic pension cost (hourly plan)
|
2,651
|
2,725
|
1,490
|
|||||||||
401(k)*
|
5,802
|
5,198
|
2,473
|
|||||||||
PCRP*
|
2,513
|
—
|
—
|
|||||||||
Other*
|
223
|
191
|
107
|
|||||||||
Total retirement costs (excluding non-qualified defined benefit retirement plan)
|
$
|
11,189
|
$
|
8,114
|
$
|
4,070
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Change in benefit obligation
|
|
|
||||||
Benefit obligation at beginning of year
|
$
|
123,495
|
$
|
118,347
|
||||
Service cost
|
1,241
|
1,231
|
||||||
Interest cost
|
4,822
|
5,325
|
||||||
Actuarial (gain) loss
|
(3,565
|
)
|
8,178
|
|||||
Benefits paid
|
(9,123
|
)
|
(9,586
|
)
|
||||
Benefit obligation at end of year
|
116,870
|
123,495
|
||||||
|
||||||||
Change in plan assets
|
||||||||
Fair value of plan assets at beginning of year
|
111,430
|
89,002
|
||||||
Actual return on plan assets
|
9,494
|
9,060
|
||||||
Employer contributions
|
—
|
23,480
|
||||||
Other expenses
|
(327
|
)
|
(526
|
)
|
||||
Benefits paid
|
(9,123
|
)
|
(9,586
|
)
|
||||
Fair value of plan assets at end of year
|
111,474
|
111,430
|
||||||
|
||||||||
Funded status
|
$
|
(5,396
|
)
|
$
|
(12,065
|
)
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Other long-term liabilities
|
$
|
(5,396
|
)
|
$
|
(12,065
|
)
|
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Discount rate used to determine benefit obligations
|
4.4
|
%
|
4.0
|
%
|
4.6
|
%
|
||||||
Discount rate used to determine net benefit cost
|
4.0
|
%
|
4.6
|
%
|
5.6
|
%
|
||||||
Long-term rate of return
|
4.7
|
%
|
6.3
|
%
|
7.8
|
%
|
||||||
|
Fiscal 2014
|
|
|
|
|||||||||
(Amounts in thousands)
|
Level 1 (a)
|
Level 2 (a)
|
Level 3
|
|||||||||
Cash and equivalents
|
$
|
207
|
$
|
6,083
|
$
|
—
|
||||||
Equity funds
|
22,623
|
7,736
|
—
|
|||||||||
Debt funds
|
—
|
74,825
|
—
|
|||||||||
Total
|
$
|
22,830
|
$
|
88,644
|
$
|
—
|
(a) | There were no transfers between Level 1 and Level 2 during fiscal 2014. |
Fiscal 2013
|
|
|
|
|||||||||
(Amounts in thousands)
|
Level 1 (b)
|
Level 2 (b)
|
Level 3
|
|||||||||
Cash and equivalents
|
$
|
429
|
$
|
15,767
|
$
|
—
|
||||||
Equity funds
|
47,047
|
16,140
|
—
|
|||||||||
Debt funds
|
—
|
32,047
|
—
|
|||||||||
Total
|
$
|
47,476
|
$
|
63,954
|
$
|
—
|
(b) | There were no transfers between Level 1 and Level 2 during fiscal 2013. |
(Amounts in thousands)
|
Benefit
Payments
|
|||
2015
|
$
|
5,574
|
||
2016
|
5,625
|
|||
2017
|
5,772
|
|||
2018
|
5,906
|
|||
2019
|
6,077
|
|||
2020 to 2024
|
33,253
|
|||
|
$
|
62,207
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Balance as of the beginning of the year
|
$
|
15,525
|
$
|
14,327
|
||||
Accruals during the year
|
15,785
|
15,370
|
||||||
Reclass to discontinued operations
|
(367
|
)
|
—
|
|||||
Settlements during the year
|
(14,930
|
)
|
(14,172
|
)
|
||||
Balance as of the end of the year
|
$
|
16,013
|
$
|
15,525
|
(Shares/units in thousands)
|
Shares/units
granted
|
Liability/
Equity
award
|
Settlement
|
|||||||||
Stock options
|
175
|
Equity
|
Common shares
|
|||||||||
Stock appreciation rights (“SARs”)
|
142
|
Liability
|
Cash
|
|||||||||
Restricted stock units – employees
|
125
|
Liability
|
Cash
|
|||||||||
Restricted stock units – directors
|
34
|
Equity
|
Common shares
|
|||||||||
Performance-based units
|
35
|
Liability
|
Cash
|
|||||||||
Performance-based shares
|
191
|
Equity
|
Common shares
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Equity-based awards expense
|
$
|
8,739
|
$
|
11,458
|
$
|
5,718
|
||||||
Liability-based awards expense
|
5,736
|
2,170
|
405
|
|||||||||
Total stock-based compensation expense
|
$
|
14,475
|
$
|
13,628
|
$
|
6,123
|
|
Number of
Shares
(In
Thousands)
|
Weighted
Average
Exercise
Price
|
Weighted
Average
Remaining
Contractual
Term (Years)
|
Aggregate
Intrinsic
Value
|
||||||||||||
Outstanding at
April 27, 2013
|
1,256
|
$
|
9.78
|
4.7
|
$
|
10,537
|
||||||||||
Granted
|
175
|
19.06
|
||||||||||||||
Exercised
|
(589
|
)
|
9.00
|
$
|
8,335
|
|||||||||||
Expired
|
(42
|
)
|
20.44
|
|||||||||||||
Canceled
|
(2
|
)
|
21.68
|
|||||||||||||
Outstanding at April 26, 2014
|
798
|
$
|
11.79
|
7.5
|
$
|
10,185
|
||||||||||
Exercisable at April 26, 2014
|
287
|
$
|
8.78
|
6.3
|
$
|
4,531
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
||||||||||
Risk-free interest rate
|
0.84
|
%
|
0.75
|
%
|
1.5
|
%
|
||||||
Dividend rate
|
0.84
|
%
|
0
|
%
|
0
|
%
|
||||||
Expected life in years
|
5.0
|
5.0
|
5.5
|
|||||||||
Stock price volatility
|
81.3
|
%
|
83.8
|
%
|
88.8
|
%
|
||||||
Turnover rate
|
0
|
%
|
0
|
%
|
4.0
|
%
|
||||||
Fair value per share
|
$
|
11.63
|
$
|
7.87
|
$
|
6.68
|
|
4/26/2014
|
|||
Risk-free interest rate
|
1.64
|
%
|
||
Dividend rate
|
1.0
|
%
|
||
Expected life in years
|
4.1
|
|||
Stock price volatility
|
49.5
|
%
|
||
Fair value per share
|
$
|
11.11
|
|
4/26/2014
|
|||
Risk-free interest rate
|
0.82
|
%
|
||
Dividend rate
|
1.0
|
%
|
||
Expected life in years
|
3.2
|
|||
Stock price volatility
|
44.4
|
%
|
||
Fair value per share
|
$
|
13.39
|
|
Number of
Shares
(In Thousands)
|
Weighted Average
Grant Date Fair
Value
|
||||||
Non-vested shares at April 27, 2013
|
530
|
$
|
6.67
|
|||||
Vested
|
(413
|
)
|
21.32
|
|||||
Canceled
|
(15
|
)
|
8.05
|
|||||
Non-vested shares at April 26, 2014
|
102
|
$
|
7.77
|
|||||
Awards granted during fiscal 2012
|
$
|
6.58
|
|
Number of
Units
(In Thousands)
|
Weighted Average
Grant Date Fair
Value
|
||||||
Non-vested units at April 27, 2013
|
156
|
$
|
11.91
|
|||||
Granted
|
125
|
19.28
|
||||||
Vested
|
(41
|
)
|
11.54
|
|||||
Canceled
|
(19
|
)
|
14.75
|
|||||
Non-vested units at April 26, 2014
|
221
|
$
|
15.90
|
Performance-based awards granted
(Shares/units in thousands)
|
Number of
Units
|
Number of
Shares
|
||||||
Fiscal 2012 grant
|
2
|
690
|
||||||
Fiscal 2013 grant
|
146
|
133
|
||||||
Fiscal 2014 grant
|
35
|
191
|
Performance-based awards earned
(Shares/units in thousands)
|
Number of
Shares/Units
|
|||
Fiscal 2012 performance-based shares
|
1,175
|
|||
Fiscal 2012 performance-based units
|
5
|
|||
Fiscal 2013 performance-based shares
|
95
|
|||
Fiscal 2013 performance-based units
|
91
|
|||
Fiscal 2014 performance-based shares
|
67
|
|||
Fiscal 2014 performance-based units
|
11
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Fiscal 2011 grant
|
$
|
—
|
$
|
1,707
|
$
|
200
|
||||||
Fiscal 2012 grant
|
3,603
|
5,442
|
1,409
|
|||||||||
Fiscal 2013 grant
|
849
|
440
|
—
|
|||||||||
Fiscal 2014 grant
|
1,006
|
—
|
—
|
(Amounts in thousands)
|
Unrealized
gain on
marketable
securities
|
Translation
adjustment
|
Change in
fair value
of cash
flow hedge
|
Net pension
amortization
and net
actuarial loss
|
Accumulated
other
comprehensive
loss
|
|||||||||||||||
Balance at April 28, 2012
|
$
|
3,017
|
$
|
4,029
|
$
|
—
|
$
|
(38,327
|
)
|
$
|
(31,281
|
)
|
||||||||
Changes before reclassifications
|
651
|
750
|
373
|
(7,645
|
)
|
(5,871
|
)
|
|||||||||||||
Amounts reclassified from accumulated other comprehensive loss
|
(3,170
|
)
|
—
|
—
|
3,140
|
(30
|
)
|
|||||||||||||
Tax effect
|
(24
|
)
|
—
|
(142
|
)
|
1,852
|
1,686
|
|||||||||||||
Other comprehensive income (loss) attributable to La-Z-Boy Incorporated
|
(2,543
|
)
|
750
|
231
|
(2,653
|
)
|
(4,215
|
)
|
||||||||||||
Balance at April 27, 2013
|
474
|
4,779
|
231
|
(40,980
|
)
|
(35,496
|
)
|
|||||||||||||
Changes before reclassifications
|
1,308
|
(2,324
|
)
|
(780
|
)
|
6,286
|
4,490
|
|||||||||||||
Amounts reclassified from accumulated other comprehensive loss
|
(300
|
)
|
—
|
321
|
3,566
|
3,587
|
||||||||||||||
Tax effect
|
(384
|
)
|
—
|
175
|
(3,752
|
)
|
(3,961
|
)
|
||||||||||||
Other comprehensive income (loss) attributable to La-Z-Boy Incorporated
|
624
|
(2,324
|
)
|
(284
|
)
|
6,100
|
4,116
|
|||||||||||||
Balance at April 26, 2014
|
$
|
1,098
|
$
|
2,455
|
$
|
(53
|
)
|
$
|
(34,880
|
)
|
$
|
(31,380
|
)
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Beginning balance
|
$
|
7,140
|
$
|
5,911
|
||||
Net income
|
1,324
|
793
|
||||||
Other comprehensive (income) loss
|
(730
|
)
|
339
|
|||||
Change in non-controlling interest
|
98
|
97
|
||||||
Ending balance
|
$
|
7,832
|
$
|
7,140
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Sales
|
|
|
|
|||||||||
Upholstery segment:
|
|
|
|
|||||||||
Sales to external customers
|
$
|
959,118
|
$
|
902,454
|
$
|
834,468
|
||||||
Intersegment sales
|
139,932
|
127,311
|
103,592
|
|||||||||
Upholstery segment sales
|
1,099,050
|
1,029,765
|
938,060
|
|||||||||
Casegoods segment:
|
||||||||||||
Sales to external customers
|
97,095
|
104,387
|
105,551
|
|||||||||
Intersegment sales
|
9,657
|
8,140
|
6,106
|
|||||||||
Casegoods segment sales
|
106,752
|
112,527
|
111,657
|
|||||||||
Retail segment sales
|
298,642
|
264,723
|
215,490
|
|||||||||
VIEs, net of intercompany sales eliminations
|
—
|
—
|
8,840
|
|||||||||
Corporate and Other
|
2,463
|
2,313
|
2,356
|
|||||||||
Eliminations
|
(149,589
|
)
|
(135,451
|
)
|
(109,698
|
)
|
||||||
Consolidated sales
|
$
|
1,357,318
|
$
|
1,273,877
|
$
|
1,166,705
|
Operating Income (Loss)
|
|
|
|
|||||||||
Upholstery segment
|
$
|
117,688
|
$
|
95,571
|
$
|
81,015
|
||||||
Casegoods segment
|
3,397
|
3,703
|
5,396
|
|||||||||
Retail segment
|
11,128
|
4,099
|
(7,819
|
)
|
||||||||
VIEs
|
—
|
—
|
959
|
|||||||||
Restructuring
|
(4,839
|
)
|
(2,631
|
)
|
(281
|
)
|
||||||
Corporate and Other
|
(38,078
|
)
|
(33,139
|
)
|
(30,573
|
)
|
||||||
Consolidated operating income
|
$
|
89,296
|
$
|
67,603
|
$
|
48,697
|
||||||
|
||||||||||||
Depreciation and Amortization
|
||||||||||||
Upholstery segment
|
$
|
13,778
|
$
|
14,275
|
$
|
12,519
|
||||||
Casegoods segment
|
1,171
|
1,338
|
1,575
|
|||||||||
Retail segment
|
2,520
|
2,676
|
2,832
|
|||||||||
VIEs
|
—
|
—
|
149
|
|||||||||
Corporate and Other
|
5,566
|
4,674
|
6,234
|
|||||||||
Consolidated depreciation and amortization
|
$
|
23,035
|
$
|
22,963
|
$
|
23,309
|
Capital Expenditures
|
|
|
|
|||||||||
Upholstery segment
|
$
|
6,579
|
$
|
9,857
|
$
|
7,261
|
||||||
Casegoods segment
|
149
|
1,058
|
897
|
|||||||||
Retail segment
|
4,379
|
4,251
|
1,848
|
|||||||||
VIEs
|
—
|
—
|
543
|
|||||||||
Corporate and Other
|
22,623
|
10,218
|
4,969
|
|||||||||
Consolidated capital expenditures
|
$
|
33,730
|
$
|
25,384
|
$
|
15,518
|
||||||
|
||||||||||||
Assets
|
||||||||||||
Upholstery segment
|
$
|
305,814
|
$
|
296,108
|
$
|
303,537
|
||||||
Casegoods segment
|
53,299
|
70,147
|
73,888
|
|||||||||
Retail segment
|
119,816
|
73,496
|
49,818
|
|||||||||
Unallocated assets
|
292,366
|
280,620
|
258,496
|
|||||||||
Consolidated assets
|
$
|
771,295
|
$
|
720,371
|
$
|
685,739
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Long-Lived Assets by Geographic Location
|
|
|
|
|||||||||
Domestic
|
$
|
147,538
|
$
|
133,208
|
$
|
114,979
|
||||||
International
|
6,805
|
8,168
|
8,345
|
|||||||||
Consolidated long-lived assets
|
$
|
154,343
|
$
|
141,376
|
$
|
123,324
|
||||||
|
||||||||||||
Sales by Country
|
||||||||||||
United States
|
86
|
%
|
86
|
%
|
86
|
%
|
||||||
Canada
|
8
|
%
|
9
|
%
|
9
|
%
|
||||||
Other
|
6
|
%
|
5
|
%
|
5
|
%
|
||||||
Total
|
100
|
%
|
100
|
%
|
100
|
%
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
United States
|
$
|
82,705
|
$
|
63,193
|
$
|
52,631
|
||||||
Foreign
|
8,854
|
7,492
|
6,319
|
|||||||||
Total
|
$
|
91,559
|
$
|
70,685
|
$
|
58,950
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Federal:
|
|
|
|
|||||||||
– current
|
$
|
24,695
|
$
|
17,049
|
$
|
11,830
|
||||||
– deferred
|
1,495
|
1,341
|
(38,597
|
)
|
||||||||
State:
|
||||||||||||
– current
|
5,345
|
2,746
|
3,446
|
|||||||||
– deferred
|
( 2,082
|
)
|
464
|
(1,864
|
)
|
|||||||
Foreign:
|
||||||||||||
– current
|
1,375
|
739
|
2,040
|
|||||||||
– deferred
|
555
|
1,181
|
(1,907
|
)
|
||||||||
Total income tax expense (benefit)
|
$
|
31,383
|
$
|
23,520
|
$
|
(25,052
|
)
|
(% of pre-tax income)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Statutory tax rate
|
35.0
|
%
|
35.0
|
%
|
35.0
|
%
|
||||||
Increase (reduction) in income taxes resulting from:
|
||||||||||||
State income taxes, net of federal benefit
|
3.1
|
3.0
|
5.0
|
|||||||||
U.S. manufacturing benefit
|
(1.0
|
)
|
(2.0
|
)
|
(2.3
|
)
|
||||||
Change in valuation allowance
|
(1.2
|
)
|
(0.3
|
)
|
(78.3
|
)
|
||||||
Gain on sale of marketable securities
|
—
|
(1.6
|
)
|
—
|
||||||||
Miscellaneous items
|
(1.6
|
)
|
(0.8
|
)
|
(1.9
|
)
|
||||||
Effective tax rate
|
34.3
|
%
|
33.3
|
%
|
(42.5
|
%)
|
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
||||||
Assets
|
|
|
||||||
Deferred and other compensation
|
$
|
19,774
|
$
|
19,510
|
||||
Allowance for doubtful accounts
|
5,456
|
9,567
|
||||||
State income tax – net operating losses, credits and other
|
6,440
|
6,542
|
||||||
Pension
|
2,097
|
4,632
|
||||||
Warranty
|
6,247
|
5,937
|
||||||
Rent
|
4,824
|
4,697
|
||||||
Workers’ compensation
|
4,068
|
3,804
|
||||||
Foreign net operating loss
|
—
|
759
|
||||||
|
||||||||
Other
|
6,598
|
5,128
|
||||||
Valuation allowance
|
(4,700
|
)
|
(6,619
|
)
|
||||
Total deferred tax assets
|
50,804
|
53,957
|
||||||
Liabilities
|
||||||||
Property, plant and equipment
|
(3,337
|
)
|
(2,745
|
)
|
||||
Net deferred tax assets
|
$
|
47,467
|
$
|
51,212
|
(Amounts in thousands)
|
Amount
|
Expiration
|
|||
Various U.S. state net operating losses (excluding federal tax effect)
|
$
|
9,215
|
Fiscal 2015 – 2033
|
||
Foreign capital losses
|
20
|
Indefinite
|
Jurisdiction
(Amounts in thousands)
|
4/27/2013
Valuation
Allowance
|
Change
|
4/26/2014
Valuation
Allowance
|
|||||||||
U.S. state
|
6,464
|
(1,784
|
)
|
4,680
|
||||||||
Foreign
|
155
|
(135
|
)
|
20
|
||||||||
Total
|
$
|
6,619
|
$
|
(1,919
|
)
|
$
|
4,700
|
(
Amounts in thousands
)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Balance at the beginning of the period
|
$
|
3,248
|
$
|
3,909
|
$
|
4,492
|
||||||
Additions:
|
||||||||||||
Positions taken during the current year
|
88
|
338
|
147
|
|||||||||
Positions taken during the prior year
|
—
|
—
|
—
|
|||||||||
Reductions:
|
||||||||||||
Positions taken during the current year
|
—
|
—
|
—
|
|||||||||
Positions taken during the prior year
|
(99
|
)
|
(28
|
)
|
(202
|
)
|
||||||
Decreases related to settlements with taxing authorities
|
(98
|
)
|
—
|
(166
|
)
|
|||||||
Reductions resulting from the lapse of the statute of limitations
|
(167
|
)
|
(971
|
)
|
(362
|
)
|
||||||
Balance at the end of the period
|
$
|
2,972
|
$
|
3,248
|
$
|
3,909
|
|
Year Ended
|
|||||||||||
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Numerator (basic and diluted):
|
|
|
|
|||||||||
Net income attributable to La-Z-Boy Incorporated
|
$
|
55,056
|
$
|
46,389
|
$
|
87,966
|
||||||
Income allocated to participating securities
|
(422
|
)
|
(639
|
)
|
(1,650
|
)
|
||||||
Net income available to common shareholders
|
$
|
54,634
|
$
|
45,750
|
$
|
86,316
|
|
Year Ended
|
|||||||||||
(Amounts in thousands)
|
4/26/2014
|
4/27/2013
|
4/28/2012
|
|||||||||
Denominator:
|
|
|
|
|||||||||
Basic weighted average common shares outstanding
|
52,386
|
52,351
|
51,944
|
|||||||||
Add:
|
||||||||||||
Contingent common shares
|
1,049
|
812
|
—
|
|||||||||
Stock option dilution
|
394
|
522
|
534
|
|||||||||
Diluted weighted average common shares outstanding
|
53,829
|
53,685
|
52,478
|
· | Level 1 — Financial assets and liabilities whose values are based on unadjusted quoted market prices for identical assets and liabilities in an active market that we have the ability to access. |
· | Level 2 — Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable for substantially the full term of the asset or liability. |
· | Level 3 — Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. |
Fiscal 2014
|
Fair Value Measurements
|
|||||||||||
(Amounts in thousands)
|
Level 1 (a)
|
Level 2 (a)
|
Level 3
|
|||||||||
Assets
|
|
|
|
|||||||||
Available-for-sale securities
|
$
|
1,521
|
$
|
57,630
|
$
|
—
|
||||||
Trading securities
|
—
|
1,787
|
—
|
|||||||||
Total
|
$
|
1,521
|
$
|
59,417
|
$
|
—
|
(a) | There were no transfers between Level 1 and Level 2 during fiscal 2014. |
Fiscal 2013
|
Fair Value Measurements
|
|||||||||||
(Amounts in thousands)
|
Level 1 (b)
|
Level 2 (b)
|
Level 3
|
|||||||||
Assets
|
|
|
|
|||||||||
Available-for-sale securities
|
$
|
1,217
|
$
|
38,747
|
$
|
—
|
||||||
Trading securities
|
—
|
1,126
|
—
|
|||||||||
Total
|
$
|
1,217
|
$
|
39,873
|
$
|
—
|
(b) | There were no transfers between Level 1 and Level 2 during fiscal 2013. |
(1)
|
Financial Statements:
|
|
|
|
Management’s Report to Our Shareholders
|
Report of Independent Registered Public Accounting Firm
|
||
|
|
Consolidated Statement of Income for each of the three fiscal years ended April 26, 2014, April 27, 2013, and April 28, 2012
|
|
|
Consolidated Statement of Comprehensive Income for each of the three fiscal years ended April 26, 2014, April 27, 2013, and April 28, 2012
|
|
|
Consolidated Balance Sheet at April 26, 2014, and April 27, 2013
|
|
|
Consolidated Statement of Cash Flows for the fiscal years ended April 26, 2014, April 27, 2013, and April 28, 2012
|
|
|
Consolidated Statement of Changes in Equity for the fiscal years ended April 26, 2014, April 27, 2013, and April 28, 2012
|
|
|
Notes to Consolidated Financial Statements
|
|
|
|
(2)
|
Financial Statement Schedules:
|
|
|
|
Report of Independent Registered Public Accounting Firm on Financial Statement Schedule
|
|
|
Schedule II — Valuation and Qualifying Accounts for the fiscal years ended April 26, 2014, April 27, 2013, and April 28, 2012
|
|
|
|
|
|
The Report of Independent Registered Public Accounting Firm and Schedule II immediately follow this item.
|
|
|
|
|
|
All other schedules are omitted because they are not applicable or not required because the required information is included in the financial statements or notes thereto.
|
(3)
|
Exhibits:
|
|
|
|
T
he following exhibits are filed or furnished as part of this report:
|
Exhibit Number
|
Description
|
(2)
|
Not applicable
|
(3.1)
|
La-Z-Boy Incorporated Restated Articles of Incorporation (
Incorporated by reference to an exhibit to Form 10-Q for the quarter ended October 26, 1996)
|
(3.2)
|
La-Z-Boy Incorporated Amendment to Restated Articles of Incorporation effective August 21, 1998 (
Incorporated by reference to an exhibit to Form 10-Q for the quarter ended October 27, 2012)
|
(3.3)
|
La-Z-Boy Incorporated Amendment to Restated Articles of Incorporation effective August 22, 2008 (Incorporated by reference to an exhibit to Form 10-Q for the quarter ended October 27, 2012)
|
(3.4)
|
La-Z-Boy Incorporated Amendment to Restated Articles of Incorporation effective August 24, 2012 (Incorporated by reference to an exhibit to Form 10-Q for the quarter ended October 27, 2012)
|
(3.5)
|
La-Z-Boy Incorporated Amended and Restated Bylaws (as of May 3, 2011) (Incorporated by reference to an exhibit to Form 8-K filed May 6, 2011)
|
(4.1)
|
Amended and Restated Credit Agreement dated as of October 19, 2011, among La-Z-Boy Incorporated, certain of its subsidiaries, the lenders named therein, and Wells Fargo Capital Finance, LLC, as administrative agent for the lenders (Incorporated by reference to an exhibit to Form 8-K filed October 21, 2011)
|
(9)
|
Not applicable
|
(10.1)*
|
La-Z-Boy Incorporated Restricted Stock Plan for Non-Employee Directors, amended and restated through August 12, 2003 (Incorporated by reference to an exhibit to definitive proxy statement dated July 9, 2003)
|
(10.2)*
|
La-Z-Boy Incorporated Deferred Stock Unit Plan for Non-Employee Directors (Incorporated by reference to an exhibit to Form 10-Q for the quarter ended October 25, 2008)
|
(10.3)*
|
Form of Change in Control Agreement in effect for: Kurt L. Darrow. Similar agreements are in effect for Steven M. Kincaid, Louis M. Riccio, Jr., Otis Sawyer and Mark S. Bacon, Sr., except the provisions related to the periods for protection and benefits are twenty-four months (Incorporated by reference to an exhibit to Form 10-K for the fiscal year ended April 24, 2010)
|
(10.4)*
|
Form of Indemnification Agreement (covering all directors, including employee-directors) (Incorporated by reference to an exhibit to Form 8-K, filed January 22, 2009)
|
(10.5)*
|
2005 La-Z-Boy Incorporated Executive Deferred Compensation Plan, amended and restated as of November 18, 2008 (Incorporated by reference to an exhibit to Form 10-Q for the quarter ended October 24, 2009)
|
(10.6)*
|
La-Z-Boy Incorporated 2004 Long-Term Equity Award Plan as amended through June 13, 2008 (Incorporated by reference to an exhibit to Form 10-K for the fiscal year ended April 26, 2008)
|
(10.7)*
|
First 2009 Amendment to La-Z-Boy Incorporated 2004 Long-Term Equity Award Plan effective June 11, 2009 (Incorporated by reference to an exhibit to Form 10-K for the fiscal year ended April 25, 2009)
|
(10.8)*
|
Second 2009 Amendment to La-Z-Boy Incorporated 2004 Long-Term Equity Award Plan effective June 15, 2009 (Incorporated by reference to an exhibit to Form 10-K for the fiscal year ended April 25, 2009)
|
(10.9)*
|
Sample award agreement under the 2004 Long-Term Equity Award Plan (
Incorporated by reference to an exhibit to Form 10-K for the fiscal year ended April 29, 2006
)
|
(10.10)*
|
Amended and Restated La-Z-Boy Incorporated 2010 Omnibus Incentive Plan (Incorporated by reference to Annex A to definitive proxy statement for annual meeting of shareholders held August 21, 2013)
|
(10.11)*
|
La-Z-Boy Incorporated 2010 Omnibus Incentive Plan Sample Award Agreement (Incorporated by reference to an exhibit to Form 10-Q for the quarter ended October 23, 2010)
|
(10.12)*
|
La-Z-Boy Incorporated 2010 Omnibus Incentive Plan Revised Sample Award Agreement effective July 9, 2012 (Incorporated by reference to an exhibit to Form 8-K filed July 9, 2012)
|
(10.13)*
|
First 2010 Amendment to La-Z-Boy Incorporated 2004 Long-Term Equity Award Plan effective June 11, 2010 (Incorporated by reference to an exhibit to Form 10-K for the fiscal year ended April 24, 2010)
|
(10.14)*
|
La-Z-Boy Incorporated Severance Plan for Named Executive Officers (Incorporated by reference to an exhibit to Form 10-K for the fiscal year ended April 24, 2010)
|
(10.15)*
|
La-Z-Boy Incorporated Performance Compensation Retirement Plan effective April 27, 2013 (Incorporated by reference to an exhibit to Form 10-K for the fiscal year ended April 27, 2013)
|
2014 Amendment to La-Z-Boy Incorporated Performance Compensation Retirement Plan
|
|
(11)
|
Statement regarding computation of per share earnings (See Note 20 to the Consolidated Financial Statements included in Item 8)
|
(12)
|
Not applicable
|
(13)
|
Not applicable
|
(14)
|
Not applicable
|
(16)
|
Not applicable
|
|
|
Additions
|
|
|
||||||||||||||||
Description
|
Balance at
Beginning
of Year
|
Charged to
Costs and
Expenses
|
Charged to
Other
Accounts
|
Deductions
|
Balance at
End of
Year
|
|||||||||||||||
Allowance for doubtful accounts, deducted from accounts receivable:
|
|
|
|
|
|
|||||||||||||||
April 26, 2014
|
$
|
21,607
|
$
|
(2,926
|
)
|
$
|
—
|
$
|
(6,313
|
)(a)
|
$
|
12,368
|
||||||||
April 27, 2013
|
22,254
|
495
|
—
|
(1,142
|
)(a)
|
21,607
|
||||||||||||||
April 28, 2012
|
23,435
|
3,508
|
—
|
(4,689
|
)(a)
|
22,254
|
||||||||||||||
|
||||||||||||||||||||
Allowance for deferred tax assets:
|
||||||||||||||||||||
April 26, 2014
|
$
|
6,619
|
$
|
(135
|
)
|
$
|
—
|
$
|
(1,784
|
)(b)
|
$
|
4,700
|
||||||||
April 27, 2013
|
8,258
|
131
|
(1,572
|
)(c)
|
(198
|
)(b)
|
6,619
|
|||||||||||||
April 28, 2012
|
52,613
|
160
|
1,687
|
(c)
|
(46,202
|
)(d)
|
8,258
|
DATE: June 17, 2014
|
|
LA-Z-BOY INCORPORATED
|
|
|
|
|
BY
|
/s/ Kurt L. Darrow
|
|
|
Chairman, President and Chief Executive Officer
|
/s/K.L. Darrow
|
|
/s/J.H. Foss
|
K.L. Darrow
|
|
J.H. Foss
|
Chairman, President and Chief Executive Officer
|
|
Director
|
|
|
|
/s/R.M. Gabrys
|
|
/s/J.L. Gurwitch
|
R.M. Gabrys
|
|
J.L. Gurwitch
|
Director
|
|
Director
|
|
|
|
/s/D.K. Hehl
|
|
/s/E.J. Holman
|
D.K. Hehl
|
|
E.J. Holman
|
Director
|
|
Director
|
|
|
|
/s/J.E. Kerr
|
|
/s/M.T. Lawton
|
J.E. Kerr
|
|
M.T. Lawton
|
Director
|
|
Director
|
|
|
|
/s/H.G. Levy
|
|
/s/W.A. McCollough
|
H.G. Levy
|
|
W.A. McCollough
|
Director
|
|
Director
|
|
|
|
/s/N.R. Qubein
|
|
/s/L.M. Riccio, Jr.
|
N.R. Qubein
|
|
L.M. Riccio, Jr.
|
Director
|
|
Senior Vice President, Chief Financial Officer
|
|
|
|
/s/M.L. Mueller
|
|
|
M.L. Mueller
|
|
|
Vice President, Corporate Controller and Chief Accounting Officer
|
|
|
► | The "Contribution Unit Credit Percentage Rate" is the percentage rate assigned to the applicable performance level achieved for the Participant's classification group for that fiscal year; |
► | "Base Salary" means the portion of a Participant's annual salary (taking into consideration salary adjustments during the performance period) actually paid during the performance period, including vacation and holiday pay; and |
► | "Bonus" means the cash bonus earned by a Participant, as a short-term incentive award under a preexisting incentive plan maintained by the Employer (or a participating Employer, as applicable), for that performance period. |
|
LA-Z-BOY INCORPORATED
|
|
|
By
|
|
|
Its
|
|
Subsidiary
|
Jurisdiction of
Incorporation
|
Alexvale Furniture, Inc.
|
North Carolina
|
Boca Raton Galleries, LLC
|
Michigan
|
England, Inc.
|
Michigan
|
Kincaid Furniture Company, Incorporated
|
Delaware
|
La-Z-Boy Asia Co., LTD (57.71%)
|
Thailand
|
La-Z-Boy Canada Limited
|
Ontario, Canada
|
La-Z-Boy Global Limited
|
Michigan
|
La-Z-Boy Greensboro, Inc.
|
North Carolina
|
La-Z-Boy Hospitality, LLC
|
Michigan
|
La-Z-Boy Logistics, Inc.
|
Michigan
|
La-Z-Boy Muebles, S. de R.L.de C.V.
|
Mexico
|
La-Z-Boy Showcase Shoppes, Inc.
|
Indiana
|
La-Z-Boy (Thailand) Ltd. (51%)
|
Thailand
|
LZB Carolina Properties, Inc.
|
Michigan
|
LZB Delaware Valley Inc.
|
Delaware
|
LZB Delaware Valley Properties, Inc.
|
Michigan
|
LZBFG of South Florida, LLC
|
Michigan
|
LZB Finance, Inc.
|
Michigan
|
LZB Furniture Galleries of Boston, Inc.
|
Michigan
|
LZB Furniture Galleries of Kansas City, Inc.
|
Michigan
|
LZB Furniture Galleries of Paramus, Inc.
|
Michigan
|
LZBFG of California, LLC
|
Michigan
|
LZBFG Management Services, Inc.
|
Michigan
|
LZB Furniture Galleries of St. Louis, Inc.
|
Michigan
|
LZB Furniture Galleries of Washington D.C., Inc.
|
Michigan
|
LZB Manufacturing, Inc.
|
Michigan
|
LZB Retail, Inc.
|
Michigan
|
Montgomeryville Home Furnishings, Inc.
|
Pennsylvania
|
Date:
June 17, 2014
|
/s/ Kurt L. Darrow
|
|
|
Kurt L. Darrow
|
|
|
Chairman, President and Chief Executive Officer
|
Date:
June 17, 2014
|
/s/ Louis M. Riccio, Jr.
|
|
|
Louis M. Riccio, Jr.
|
|
|
Senior Vice President and Chief Financial Officer
|
|
/s/ Kurt L. Darrow
|
|
Kurt L. Darrow
|
|
Chairman, President and Chief Executive Officer
|
|
June 17, 2014
|
|
|
|
/s/ Louis M. Riccio, Jr.
|
|
Louis M. Riccio, Jr.
|
|
Senior Vice President and Chief Financial Officer
|
|
June 17, 2014
|
|