Flexsteel Industries Q1 2024 Update

TL;DR

Flexsteel Q1 2024: Credit, stock, and incentive plans detailed. All systems go.

AI Summary

Flexsteel Industries Inc. reported its first quarter results for the period ending September 30, 2024. The company's financial statements reflect activities related to its credit agreement with Wells Fargo Bank, N.A., and various equity instruments including common stock, restricted stock units, and performance shares. Specific details on interest rate swaps and management incentive plans are also noted.

Why It Matters

This filing provides insight into the financial health and operational activities of Flexsteel Industries Inc. during the first quarter of fiscal year 2024, impacting investors and stakeholders.

Risk Assessment

Risk Level: low — This filing is a routine quarterly report and does not contain immediate, significant negative news.

Key Numbers

• Q1 — Quarterly Period (Indicates the report covers the first fiscal quarter of 2024.)

Key Players & Entities

• Flexsteel Industries Inc. (company) — Filer of the 10-Q report.
• Wells Fargo Bank, N.A. (company) — Lender in the company's credit agreement.
• 2024-09-30 (date) — End of the reporting period for the 10-Q.
• 2024-07-01 (date) — Beginning of the reporting period for the 10-Q.

FAQ

Key Financial Figures

• $1.00 — Exchange Act). Yes No Common Stock - $1.00 Par Value Shares Outstanding as of Oc

Filing Documents

• flxs-20240930.htm (10-Q) — 958KB
• flxs-ex31_1.htm (EX-31.1) — 16KB
• flxs-ex31_2.htm (EX-31.2) — 13KB
• flxs-ex32.htm (EX-32) — 8KB
• 0000950170-24-116719.txt ( ) — 4693KB
• flxs-20240930.xsd (EX-101.SCH) — 732KB
• flxs-20240930_htm.xml (XML) — 761KB

– Financial Information

Part I – Financial Information Item 1.

Financial Statements

Financial Statements 3 Consolidated Balance Sheets as of September 30, 2024, and June 30, 2024 (Unaudited) 3 Consolidated Statements of Income and Comprehensive Income for three months ended September 30, 2024, and September 30, 2023 (Unaudited) 4 Consolidated Statements of Changes in Shareholders' Equity for the three months ended September 30, 2024, and September 30, 2023 (Unaudited) 5 Consolidated Statements of Cash Flows for the three months ended September 30, 2024, and September 30, 2023 (Unaudited) 6

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 7 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 13 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 15 Item 4.

Controls and Procedures

Controls and Procedures 15

– Other Information

Part II – Other Information Item 1A.

Risk Factors

Risk Factors 16 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 16 Item 5. Other Information 17 Item 6. Exhibits 17

FINANCIAL INFORMATION

PART I FINANCIAL INFORMATION Ite m 1. Financial Statements FLEXSTEEL INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Amounts in thousands) September 30, June 30, 2024 2024 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 5,740 $ 4,761 Trade receivables - less allowances: September 30, 2024, $ 2,480 , June 30, 2024, $ 2,440 39,481 44,238 Inventories 95,897 96,577 Other 8,787 8,098 Assets held for sale 1,707 1,707 Total current assets 151,612 155,381 NONCURRENT ASSETS: Property, plant and equipment, net 36,175 36,709 Operating lease right-of-use assets 59,462 61,439 Deferred income taxes 8,585 8,607 Other assets 12,890 12,326 TOTAL ASSETS $ 268,724 $ 274,462 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable - trade $ 24,852 $ 25,830 Current portion of operating lease liabilities 7,430 7,517 Accrued liabilities: Payroll and related items 6,167 12,059 Insurance 1,957 1,900 Sales and advertising related items 5,803 6,073 Other 7,125 7,027 Total current liabilities 53,334 60,406 LONG-TERM LIABILITIES: Operating lease liabilities, less current maturities 56,223 58,076 Line of credit 3,581 4,822 Other liabilities 883 791 Total liabilities 114,021 124,095 SHAREHOLDERS' EQUITY: Common stock - $ 1 par value; authorized 15,000 shares; 8,414 shares issued and 5,207 outstanding as of September 30, 2024; 8,407 shares issued and 5,200 outstanding as of June 30, 2024 8,414 8,407 Additional paid-in capital 40,672 39,573 Treasury stock, at cost; 3,207 shares as of September 30, 2024, and June 30, 2024 ( 71,731 ) ( 71,731 ) Retained earnings 177,348 174,118 Total shareholders' equity 154,703 150,367 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 268,724 $ 274,462 See accompanying Notes to Consolidated Financial Sta

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) FOR THE PERIOD ENDED September 30, 2024 1. BASIS OF PRESENTATION AND DESCRIPTION OF BUSINESS DESCRIPTION OF BUSINESS – Flexsteel Industries, Inc. and Subsidiaries (the "Company" or "Flexsteel" or "Our") is one of the largest manufacturers, importers, and marketers of furniture products in the United States. Product offerings include a wide variety of furniture such as sofas, loveseats, chairs, reclining rocking chairs, swivel rockers, sofa beds, convertible bedding units, occasional tables, desks, dining tables and chairs, kitchen storage, bedroom furniture, and outdoor furniture. A featured component in most of the upholstered furniture is a unique steel drop-in seat spring from which the name "Flexsteel" is derived. The Company distributes its products throughout the United States through its e-commerce channel and direct sales force. BASIS OF PRESENTATION – The unaudited Consolidated Financial Statements included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). The information contained in the Consolidated Financial Statements includes normal recurring adjustments and reflects all adjustments, which are, in the opinion of management, necessary for a fair presentation of such Consolidated Financial Statements. Operating results for the three months ended September 30, 2024, are not necessarily indicative of the results that may be expected for the fiscal year ending June 30, 2025. Certain information and footnote disclosures normally included in the Consolidated Financial Statements prepared in accordance with generally accepted accounting principles ("GAAP") in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. Except to the extent updated or described below, the significant a

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