Why LL Flooring (LL) Shares Are Falling Today

LL Flooring Holdings, Inc. LL reported a fourth-quarter sales decline of 7.5% year-on-year to $263.87 million, missing the consensus of $267.60 million.
Comparable store sales decreased 9.5% versus last year.
Adjusted EPS loss of $(0.29) missed the consensus of $0.08.
Gross margin contracted 140 basis points Y/Y to 35.9%, and the gross profit fell 11% to $94.7 million.
Operating margin fell 1,040 basis points to (6.6%), and the operating loss for the quarter was ($17.3) million versus a profit of $10.9 million last year.
The company held $10.8 million in cash and equivalents as of Dec. 31, 2022.
During Q4, the company opened three new stores, bringing total stores to 442 as of Dec. 31, 2022.
The company has $43.0 million available for repurchase under its existing share repurchase program.
Outlook: LL is not providing financial guidance at this time, citing uncertainty in the macroeconomic environment due to consumer confidence, inflation, a volatile interest and mortgage rate environment, and continued declines in existing home sales.
LL Flooring sees FY23 capital expenditure of $15 million - $20 million. It expects to open three new stores in 2023.
Price Action: LL shares traded lower by 9.75% at $4.55 on the last check Wednesday.

LL Flooring Drops After Q4 Earnings Miss; Dodges FY23 Financial Guidance Citing Macro Uncertainty