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March 12 (Reuters) - Hardwood-flooring retailer Lumber Liquidators Inc (LL.N) posted quarterly results above analysts’ estimates, helped by sales of its higher-margin products, and forecast strong results for 2008, sending shares up 23 percent.
The retailer posted higher results even as rivals, including big home improvement chains such as Home Depot Inc (HD.N) and Lowe’s Companies (LOW.N), reported lackluster results after consumers curbed spending on big-ticket items amidst falling home prices and tighter lending conditions.
Lumber Liquidators, which made its market debut in November 2007, had claimed that it was insulated from the U.S. subprime mortgage crisis as its typical customer was in his mid-thirities or older, with higher-than-average income and typically in his home for several years.
The retailer, whose brands include Bellawood and Builder’s Pride, posted a fourth-quarter profit of $3.1 million, or 12 cents a share, compared with $1.6 million, or 7 cents a share, a year earlier.
Net sales rose 24.4 percent to $105.5 million, it said.
Analysts on average had expected Lumber to earn 10 cents a share, before items, on revenue of $102.3 million, according to Reuters Estimates.
“We gained traction in our business in the second half of 2007 as we benefited from our increased in-stock positions and expanded merchandise assortment, as well as our improved inventory planning and management systems,” Lumber CEO Jeffrey Griffiths said in a statement.
Toano, Virginia-based Lumber also reported an 8.6 percent rise in comparable store sales during the quarter.
For 2008, the company expects earnings of 70 cents to 78 cents a share on net sales of about $475 million to $490 million.
Analysts were expecting it to earn 73 cents a share, before items, on revenue of $482.4 million.
Lumber, which plans to open about 30 to 40 stores in 2008, expects comparable store sales to rise in the mid-single digit range in 2008.
Lumber’s stock was $1.42 up at $9.02 in morning trade, making it one of the top percentage gainers on the New York Stock Exchange. (Reporting by Dhanya Skariachan in Bangalore; Editing by Anil D‘Silva)