LFL sets 3Q sales record
TORONTO – Increases in in-store traffic coupled with robust growth in its e-commerce business propelled Leon’s Furniture Limited (LFL), this country’s largest full-line furniture, mattress and appliance retailer, to record highs for both sales and earnings for the third quarter of 2021, according to company documents.
Last week, the company said total system-wide sales for the three months ending September 30, 2021, were $825.5 million, up 8.2% from the $762.8 million for the same period last year.
Corporate store sales $683.2 million, up 8.3% from last year’s $630.8 million as same store sales advanced 9.7% on a year-over-year basis.
Revenue from its 102-store franchise network climbed 7.8% to $142.3 million from last year’s $132.0 million.
Most analysts opined LFL’s third quarter growth was broad-based, with upticks coming from all regions of the country and across all major product categories, although furniture and mattress sales were believed to be proportionately higher, leading to a positive mix shift.
E-commerce growth was robust, growing 48% in the third quarter, on top of 235% in the same period of 2020, which is also reflective of LFL’s multi-year investments in its digital platforms (leons.ca; thebrick.com and furniture.ca).
These online stores are believed to account for approximately 20% of LFL’s revenue during the three months from July to September – up from about 16% for the same period last year. This gives their online stores a year-over-year growth rate of about 35%.
Net income for the quarter was $63.8 million or 77 cents per diluted share, compared to $49.1 million or 61 cents per diluted share – an uptick of 26.2% on a per share basis.
For the nine months also ending September 30, 2021, total system-wide revenues totaled $2.24 billion, up 19.6% from the $1.87 billion rung-up for the same period last year.
Corporate store sales came in at $1.84 billion, an increase of 19.3% from last year’s $1.55 billion as same store sales also advanced by 19.3%.
Franchise store sales were up 21.6% to $394.2 million from last year’s $325.6 million.
Net income for the nine months was $150.7 million or $1.89 per diluted share, compared to $110.0 million or $1.33 per diluted share for the same period of 2020 – a 42.1% jump on a per share basis.
The company noted for the trailing 12 months ending September 30, 2021, adjusted earnings per share totaled $2.58, compared to $1.54 for the trailing 12 months ending September 30, 2020.
It also pointed out that during the first nine months of 2021, it returned $193.0 million to shareholders in the form of dividends declared and common share repurchases, more than double the $73.1 million returned in the prior period.
In his comments, LFL president and chief executive officer Mike Walsh noted “our team continued to harness the power of LFL’s national omnichannel retail and distribution platform to generate the best top line results in the company’s history as well as record profitability.
“This was my first full quarter as the company’s CEO and I see plenty of opportunity to continue building on our solid Q3 results, leveraging an exceptional combination of retail, e-commerce, wholesale, service and distribution assets, and a rock-solid balance sheet,” he continued, adding, “Our team has a proven track record of delivering financial performance even in challenging environments, and now has more tools at its disposal. One of those tools is the company’s e-commerce platform, which continues to demonstrate its growth potential and scalability, with 48% growth in Q3 on top of 235% growth in the same period last year.”
At the end of September, LFL operated some 304 stores from coast-to-coast under five banners: Leon’s, Appliance Canada, The Brick, The Brick Mattress Store and Brick Outlet.