Flexsteel Industries Reports Increased Net Sales and Significant Recovery in Operating Income for Quarter Ended March 31, 2026

Flexsteel Industries, Inc. reported a notable financial performance for the quarter and nine months ended March 31, 2026, with net sales reaching $115.1 million, a 1.0% increase from $113.9 million in the same period last year. For the nine-month period, net sales increased by 5.3% to $343.8 million compared to $326.5 million in the prior year. The growth in revenue was attributed to higher pricing from tariff surcharges, although this was partially offset by a decline in unit volume, particularly in the made-to-order and ready-to-assemble categories. The company also reported a gross profit of $26.0 million for the quarter, resulting in a gross margin of 22.6%, up from 22.2% in the previous year.

Flexsteel's operating income for the quarter was $8.2 million, a significant recovery from an operating loss of $5.1 million in the prior year. The nine-month operating income also improved to $26.2 million from $12.6 million. Net income for the quarter was $6.4 million, or $1.14 per diluted share, compared to a net loss of $3.7 million, or $(0.71) per diluted share, in the same quarter last year. For the nine-month period, net income was $20.4 million, or $3.63 per diluted share, compared to $9.5 million, or $1.70 per diluted share, in the prior year.

The company’s balance sheet showed total assets of $290.2 million as of March 31, 2026, an increase from $282.5 million at the end of the previous fiscal year. Current assets rose to $200.5 million, driven by increases in cash and trade receivables, while inventories decreased to $80.6 million. Total liabilities decreased to $104.9 million from $114.6 million, reflecting a reduction in current liabilities. Shareholders' equity increased to $185.3 million, up from $167.9 million, primarily due to retained earnings growth.

Operationally, Flexsteel's sales order backlog increased by 1.5% to $79.5 million as of March 31, 2026. The company has continued to invest in growth initiatives, reflected in a $0.7 million increase in selling, general, and administrative expenses for the quarter. The effective tax rate for the quarter was 24.9%, slightly higher than the previous year's rate of 24.5%. Looking ahead, Flexsteel anticipates continued challenges from market conditions, including pricing pressures and supply chain disruptions, but remains focused on leveraging its product offerings and operational efficiencies to drive future growth.