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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported) August 7, 2003
(Exact name of registrant as specified in its charter)
Flexsteel Industries, Inc.
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
Minnesota 0-5151 42-0442319
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Registrant's telephone number, including area code 563-556-7730
Item 5. Other Events
On August 7, 2003, Flexsteel Industries, Inc. Announces Fourth Quarter
and Fiscal 2003 Operating Results. See the Press Release attached hereto and
incorporated herein for further information.
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Flexsteel Industries, Inc.
--------------------------
(Registrant)
Date: August 8, 2003 By: /s/ R.J. Klosterman
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R. J. Klosterman
Financial Vice President &
Principal Financial Officer
Exhibit 99.1
Flexsteel Announces Fourth Quarter and Fiscal 2003 Operating Results
DUBUQUE, Iowa--(BUSINESS WIRE)--Aug. 7, 2003--Flexsteel
Industries, Inc. (Nasdaq:FLXS) today reported sales and earnings for
its fourth quarter and fiscal year ended June 30, 2003.
Net sales for the fiscal quarter ended June 30, 2003 were $74.9
million compared to the prior year quarter of $76.9 million, a
decrease of 2.6%. Net income for the current quarter was $2.6 million
or $0.41 per share compared to the prior year quarter of $2.7 million
or $0.44 per share.
Net sales for the fiscal year ended June 30, 2003 were $292.0
million compared to $279.7 million in the prior fiscal year, an
increase of 4.4%. Net income for the fiscal year ended June 30, 2003
of $8.3 million or $1.30 per share increased from net income for the
prior fiscal year of $5.7 million or $0.92 per share.
During the current quarter, residential seating sales were $48.5
million, a decrease of 6.5% from the prior year quarter. Recreational
vehicle seating sales were $18.9 million, a decrease of 3.8%.
Commercial seating sales were $7.5 million, an increase of 39.9%.
For the fiscal year ended June 30, 2003, residential seating sales
were $194.0 million, an increase of 0.4% over the prior fiscal year.
Recreational vehicle seating sales were $75.6 million, an increase of
11.4%. Commercial seating sales were $22.4 million, an increase of
20.5%.
Gross margin for the quarter ended June 30, 2003 was 23.3%
compared to 24.7% in the prior year quarter. The gross margin decline
was due to reduced sales volume, changes in product mix and raw
material cost increases. For the fiscal year ended June 30, 2003, the
gross margin was 22.4% compared to 22.0% for the prior fiscal year.
The prior fiscal year gross margin was reduced by a charge of $1.2
million for estimated facility closing costs.
Selling, general and administrative expenses as a percentage of
sales were 17.1% and 19.3% for the current quarter and prior year
quarter, respectively. During the quarter ended June 30, 2002, the
Company recorded a charge of $0.9 million for estimated retail store
closing costs to selling, general and administrative expenses. For the
fiscal year ended June 30, 2003 and 2002, selling, general and
administrative expenses as a percentage of net sales were 18.0% and
19.1%, respectively. The lower percentage in fiscal 2003 primarily
represents reductions in provision for doubtful accounts and estimated
retail facility closing costs.
During the first quarter of fiscal 2003, the Company sold land
adjacent to the Lancaster, Pennsylvania factory at a net gain (after
tax) of $0.2 million or $0.04 per share.
Working capital at June 30, 2003 was $67.7 million, which includes
cash, cash equivalents and investments of $22.3 million. Working
capital increased by $5.5 million from June 30, 2002.
Capital expenditures were $5.1 million and $1.1 million during
fiscal 2003 and 2002, respectively. Fiscal 2003 expenditures were
incurred primarily for delivery and manufacturing equipment. Projected
capital spending for fiscal 2004 is $5.5 million and will be used for
the expansion of the Dublin, Georgia facility, manufacturing and
delivery equipment.
Our Chief Executive Officer and Chief Financial Officer will file
a statement in our Annual Report on Form 10-K to the Securities and
Exchange Commission certifying our financial statements in accordance
with Sections 302 and 906 of the Sarbanes-Oxley Act of 2002.
All earnings per share amounts are on a diluted basis.
The Company will host a conference call Friday, August 8, 2003, at
10:00 a.m. Central Time. The dial-in-number is 800-556-3831 with an
access code of 00566. A replay will be available for two weeks
beginning approximately four hours after the conclusion of the call.
The dial-in-number for the replay is 888-813-1488 and no access code
is required.
For more information, visit our web site at
http://www.flexsteel.com.
Statements, including those in this release, which are not
historical or current facts are "forward-looking statements" made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. There are certain important factors
that could cause results to differ materially from those anticipated
by some of the statements made herein. Investors are cautioned that
all forward-looking statements involve risk and uncertainty. Some of
the factors that could affect results are the cyclical nature of the
furniture industry, the effectiveness of new product introductions,
the product mix of sales, the cost of raw materials, the amount of
sales generated and the profit margins thereon, competition, both
foreign and domestic, credit exposure with our customers, and general
economic conditions. Any forward-looking statement speaks only as of
the date of this press release. The Company specifically declines to
undertake any obligation to publicly revise any forward-looking
statements that have been made to reflect events or circumstances
after the date of such statements or to reflect the occurrence of
anticipated or unanticipated events.
FLEXSTEEL INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
June 30, June 30,
2003 2002
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ASSETS
CURRENT ASSETS:
Cash and cash equivalents............$ 12,811,385 $ 5,375,683
Investments.......................... 9,531,913 15,876,088
Trade receivables, net............... 29,612,278 31,361,285
Inventories.......................... 32,473,287 30,322,288
Other................................ 5,393,426 6,225,654
------------ ------------
Total current assets....................... 89,822,289 89,160,998
PROPERTY, PLANT, AND EQUIPMENT, net........ 20,377,797 20,558,338
OTHER ASSETS............................... 10,500,196 9,439,940
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TOTAL......................................$120,700,282 $119,159,276
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES........................$ 22,156,730 $ 26,932,925
DEFERRED COMPENSATION...................... 4,790,225 4,509,782
------------ ------------
Total liabilities.......................... 26,946,955 31,442,707
SHAREHOLDERS' EQUITY....................... 93,753,327 87,716,569
------------ ------------
TOTAL......................................$120,700,282 $119,159,276
============ ============
FLEXSTEEL INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended Fiscal Year Ended
June 30, June 30,
--------------------------- ---------------------------
2003 2002 2003 2002
------------- ------------- ------------- -------------
NET SALES..... $74,916,424 $76,894,738 $291,977,165 $279,671,402
COST OF GOODS
SOLD......... (57,488,214) (57,891,259) (226,437,717) (218,150,740)
------------- ------------- ------------- -------------
GROSS MARGIN.. 17,428,210 19,003,479 65,539,448 61,520,662
SELLING,
GENERAL AND
ADMIN-
ISTRATIVE.... (12,790,722) (14,877,610) (52,658,237) (53,391,377)
GAIN ON SALE
OF LAND...... 403,065
------------- ------------- ------------- -------------
OPERATING
INCOME....... 4,637,488 4,125,869 13,284,276 8,129,285
------------- ------------- ------------- -------------
OTHER:
Interest
and
other
income.. 211,319 304,321 1,083,854 1,052,158
Interest
expense. (25,618) (3,115) (126,853) (21,899)
------------- ------------- ------------- -------------
Total 185,701 301,206 957,001 1,030,259
------------- ------------- ------------- -------------
INCOME BEFORE
INCOME TAXES. 4,823,189 4,427,075 14,241,277 9,159,544
PROVISION FOR
INCOME TAXES. (2,200,000) (1,690,000) (5,950,000) (3,500,000)
------------- ------------- ------------- -------------
NET INCOME.... $2,623,189 $2,737,075 $8,291,277 $5,659,544
============= ============= ============= =============
AVERAGE NUMBER
OF COMMON
SHARES
OUTSTANDING:
BASIC... 6,284,298 6,172,258 6,255,113 6,095,184
============= ============= ============= =============
DILUTED. 6,392,903 6,249,368 6,367,241 6,158,522
============= ============= ============= =============
EARNINGS PER
SHARE OF
COMMON STOCK:
BASIC... $0.42 $0.44 $1.33 $0.93
============= ============= ============= =============
DILUTED. $0.41 $0.44 $1.30 $0.92
============= ============= ============= =============
CONTACT: Flexsteel Industries, Inc., Dubuque
Timothy E. Hall, 563-556-7734 x392