Lumber Liquidators sees Second Quarter EPS and Revenues Below Consensus

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Last Update: 07-Jul-11 10:03 ET

Lumber Liquidators (LL $20.13 -5.51) issued downside guidance for the second and third quarter, as well as its fiscal year 2011.

For the second quarter, the company expects to see earnings in the range of $0.18 to $0.20 versus the $0.31 Capital IQ Consensus Estimate; sees second quarter revenue of $175.5 million to $168.7 million versus the $187.97 million Capital IQ Consensus Estimate.

For the third quarter, the company sees earnings at $0.21 to $0.31 versus $0.33 Capital IQ Consensus Estimate; sees third quarter revenues of $165 million to $180 million versus the $181.83 million Capital IQ Consensus Estimate.

For its fiscal year 2011, the company expects earnings of $1.00 to $1.15 versus the $1.20 Capital IQ Consensus Estimate; sees fiscal year 2011 revenues of $670 million to $700 million versus the $712.15 million Capital IQ Consensus Estimate.

At comparable stores, net sales are expected to decrease approx. 8.0% for the quarter, in comparison to an increase of 5.5% for the second quarter of the prior year. Net sales at non-comparable stores are expected to increase $20.1 million over the prior year period as the co opened 11 new stores during the second quarter, and has opened 27 new stores in the first half of 2011.

In addition to the weaker than expected net sales, gross margin during the quarter was adversely impacted by greater promotional sales and higher transportation costs. Further, certain expenses as a percentage of net sales were higher than anticipated. Third quarter comparable store net sales ranging from a decrease of 1% to an increase of 8%. Fourth quarter comparable store net sales ranging from a decrease of 3% to an increase of 6%.