La-Z-Boy Inc’s Performance-based Shares Outstanding Rise to 763 Thousand, with Unrecognized Compensation Cost of $6.7 Million

La-Z-Boy Inc. (ticker: LZB), a leading manufacturer and retailer of furniture, has seen significant growth in its performance-based shares outstanding. As of April 29, 2023, the company had 763 thousand shares outstanding at a weighted average grant date fair value of $28.47, showing promise in the long-term financial stability and growth of the company. Additionally, the unrecognized compensation cost related to performance-based shares stood at $6.7 million, which is expected to be recognized over a weighted-average remaining contractual term of 1.4 years.

The company’s performance-based share program allows employees to earn shares if they meet certain goals over a three-year performance period, and if they remain employed with the company through the end of the performance period. This incentivizes employees to drive growth and improve the overall performance of the company. The increase in the number of outstanding shares could potentially be a sign of strong growth and financial performance.

La-Z-Boy has been expensing the compensation cost for its performance-based shares as equity-based awards over the vesting period. This is because the shares will be settled in common stock once they vest. In the event of employee termination during the vesting period, the potential right to earn shares under this program is typically forfeited. The company has elected to recognize these forfeitures as an adjustment to compensation expenses in the same period in which they occur.

The company’s equity-based compensation expenses related to performance-based shares stood at $4.293 million for the fiscal year ended April 29, 2023, compared to $4.971 million and $5.505 million for the fiscal years ended April 30, 2022, and April 24, 2021, respectively. This shows that while the amount of expense related to these shares has decreased slightly in recent years, it still represents a significant portion of the company’s overall operating expenses.

In addition to its performance-based shares program, La-Z-Boy has been working on various strategies to improve its financial performance. In the wholesale segment, the company has been focusing on manufacturing and importing high-quality upholstered furniture and casegoods to cater to a wide variety of customer preferences. In the retail segment, the company has been working to expand its company-owned La-Z-Boy Furniture Galleries® stores. The performance of both these segments has been improving over the past few years, and the expansion of these divisions is likely playing a role in the company’s strong performance.

As a result of these strategies, La-Z-Boy has seen steady growth in its net sales over the past few years. For the fiscal year ended April 29, 2023, the company reported consolidated net sales of $2.349 billion, compared to $2.357 billion and $1.734 billion for the fiscal years ended April 30, 2022, and April 24, 2021, respectively. This growth can be attributed to the company’s focus on product innovation, broadening its distribution channels, and improving retail strategies.

In conclusion, La-Z-Boy Inc. continues to be a strong player in the furniture industry, with positive growth in its performance-based shares outstanding and continued emphasis on enhancing its product offerings and retail strategies. The company’s unrecognized compensation cost of $6.7 million for performance-based shares shows its commitment to employee performance and long-term growth, positioning the company for continued success in the coming years.

Income Statement

Financials in millions USD. Fiscal year is May – April. source

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