On November 2, 2023, Floor & Decor Holdings Inc (FND, Financial) announced its financial results for the third quarter of fiscal 2023, which ended on September 28, 2023. Despite the ongoing economic challenges, the company managed to increase its net sales by 0.9% from the third quarter of fiscal 2022, reaching $1,107.8 million. However, comparable store sales decreased by 9.3%.
Financial Highlights
For the third quarter of fiscal 2023, operating income stood at $84.8 million, a decrease of 16.6% from $101.7 million in the third quarter of fiscal 2022. The operating margin was 7.7%, a decrease of 160 basis points from the same period last year. Net income was $65.9 million, a decrease of 13.5% from $76.2 million in the third quarter of fiscal 2022. Diluted earnings per share ("EPS") of $0.61 decreased 14.1% from $0.71 in the third quarter of fiscal 2022. Adjusted EBITDA* of $140.9 million decreased 4.7% from $147.9 million in the third quarter of fiscal 2022.
Company's Performance and Future Outlook
Despite the decrease in comparable store sales, the company opened five new warehouse stores in the third quarter of fiscal 2023. The company plans to open 15 more in the fourth quarter of fiscal 2023, aiming to achieve its 32 new store opening plan for fiscal 2023.
For the fiscal year ending December 28, 2023, the company expects net sales of approximately $4,345 million to $4,385 million, comparable store sales of approximately (8.5)% to (7.8)%, and diluted EPS of approximately $2.14 to $2.24.
CEO's Commentary
Tom Taylor, Chief Executive Officer, stated,
“Amidst the continuing economic challenges posed by rising mortgage interest rates, near-record-low existing home sales, ongoing pressure on housing affordability, and slowing sales of large ticket discretionary products, we are pleased to deliver third-quarter diluted earnings per share of $0.61. Our fiscal 2023 third-quarter results are a testament to our company’s agility and unwavering commitment to executing our key growth and customer engagement strategies at an exceptional level. We remain focused on continuing to grow our market share by capitalizing on our everyday low prices and value-driven options, trend-right product assortments, in-stock job lot quantities, and the exceptional customer service provided by our store associates. We believe that our execution and new warehouse store openings will position us for accelerating sales and earnings growth when industry growth returns.”
Financial Tables
The company's net sales for the thirty-nine weeks ended September 28, 2023, increased by 4.6% from the same period of fiscal 2022, reaching $3,365.8 million. However, comparable store sales decreased by 6.3%. Operating income was $275.3 million, a decrease of 8.9% from $302.0 million in the same period of fiscal 2022. The operating margin was 8.2%, a decrease of 120 basis points from the same period of fiscal 2022.
As of September 28, 2023, the company's total assets stood at $4,638,082, an increase from $4,351,242 as of December 29, 2022. The total liabilities were $2,752,606, slightly higher than $2,694,066 as of December 29, 2022. The total stockholders' equity was $1,885,476, an increase from $1,657,176 as of December 29, 2022.
*Non-GAAP financial measure. Please see “Non-GAAP Financial Measures” and “Reconciliation of GAAP to Non-GAAP Financial Measures” below for more information.Explore the complete 8-K earnings release (here) from Floor & Decor Holdings Inc for further details.
