Home Furnishing Brand Lovesac Releases Delayed July-Ended Q2 Results: Here's Details

Home furnishing brand Lovesac Company LOVE reported second-quarter FY24 sales growth of 4% year-on-year to $154.50 million, beating the analyst consensus estimate of $150.66 million.

The company had earlier postponed the release of the final results of the second quarter results, which ended July 30, 2023, as it had to restate its previously issued financial statements for fiscal year 2023 and its first quarter fiscal 2024 primarily due to errors in accounting for a last mile journal entry and the methodology used to calculate the accrual of its last mile freight expenses.

Gross profit rose 16.8% Y/Y to $92.4 million, with the margin expanding 650 basis points to 59.8%. Total comparable sales climbed 7.2%. Internet sales rose 16.6% in the quarter.

Total operating expenses climbed 31.6% Y/Y to $93.4 million. The operating loss for the quarter was $(1) million, compared to an operating income of $8.1 million last year.

Adjusted EBITDA decreased 57.1% Y/Y to $5.3 million. EPS of $(0.04) topped the consensus of $(0.13).

Lovesac held $54.7 million in cash and equivalents as of July 30, 2023. Net cash provided by operating activities during the quarter totaled $21.1 million.

Outlook: For the third quarter ended October 29, 2023, Lovesac sees EPS of $(0.20) - $(0.33) versus the Street view of $(0.03) and sales of $154 million (prior view $150 million-$152 million) against the estimate of $153.35 million.

LOVE currently expects FY24 EPS of $1.21 - $1.75 versus the estimate of $1.93 and sales of $710 million - $730 million versus the estimate of $712.15 million.

Price Action: LOVE shares traded lower by 1.13% at $17.55 on the last check Friday.