Flexsteel Industries (NASDAQ:FLXS)
According to Flexsteel Industries (NASDAQ:FLXS), the board of directors rejected CSC Generation Holdings’ unsolicited offer to buy the firm for $20.80 per share in cash because it drastically undervalued the business. As per CSC Generation, Flexsteel’s (FLXS) performance would be enhanced under private ownership.
Flexsteel Chairman Thomas M. Levine stated, “After careful analysis and discussion of CSC’s unsolicited bid, our Board determined that the proposal severely undervalues Flexsteel, is opportunistic and is not in the best interest of the Company or our shareholders.” The board is optimistic that the management team will continue successfully implementing Flexsteel’s strategic plan, resulting in greater long-term value for shareholders.
Q4 filings by Flexsteel
According to a press release, Flexsteel had a record-breaking fiscal year in sales in 2022. “We continue to make notable progress in executing our strategic plan, strengthening our supply chain, and investing in talent, product innovation, and digital capabilities,” said President and CEO Jerry Dittmer.
Net sales for the fourth quarter were $124.5 million, a decrease of $11.7 million, or 8.6%, from the $136.2 million in the same time the previous year. Although sales have decreased, our ongoing domestic furnishings business’s revenue is still higher than before the pandemic.
Operating income for the quarter of $3.6 million.
Compared to the previous year, Flexteel’s retail channel’s sales performance dropped by $7.6 million or 6%. E-commerce product sales fell by $4 million, or 23%, over the previous year.
If sales increase as anticipated, the H2 fiscal year should see an increase in gross margin to the mid-to-upper teens. SG&A expenses in Q1 might range between $14 million and $15 million.
We anticipate SG&A expenses in the first quarter to range between $14 million and $15 million.
Depending on the growth of the gross margin, SG&A spending may pick up later in the year. Regarding our cash flow projections, working capital is anticipated to be a source of cash flow in the first quarter and for the entire year because we expect inventories to continue to drop.
Flexsteel’s opening of a third manufacturing facility in Juarez, Mexico, is a big boost in its capacity and supply chain. The company has constructed a new distribution hub in Greencastle, Pennsylvania, to better serve customers in the Northeast.
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