Lumber Liquidators swings to surprise profit as sales fall less than forecast

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Lumber Liquidators Holdings Inc. reported Wednesday that it swung to a surprise second-quarter profit as sales fell less than expected, as sales trends improved through the quarter as markets reopened following COVID-19-related shutdowns. The wood flooring retailer recorded net income of $2.6 million, or 9 cents a share, after a loss of $2.9 million, or 10 cents a share, in the year-ago period. Excluding non-recurring items, adjusted earnings per share came to 10 cents, compared with the FactSet consensus of a per-share loss of 19 cents. Sales fell 20.2% to $230.3 million, above the FactSet consensus of $220.6 million, while same-store sales dropped 21.3% to beat expectations of a 24.4% decline. Through May 23, same-store sales had been down 30%. And through late June, all employees who had been furloughed because of the COVID-19 pandemic had returned to work, as the company’s distribution centers resumed “normal” operations. “Based on what we know today about the impact of COVID-19, the company believes that cash flows from operations, together with the liquidity under its Credit Agreement, provides sufficient liquidity to navigate the current environment,” the company stated. The stock, which was indicated up fractionally in premarket trading, has more than doubled (up 134%) year to date through Tuesday, while the S&P 500 has gained 2.3%.Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.