Floor & Decor Holdings, Inc. reported a modest increase in net sales for the fiscal year ending December 26, 2024, reaching $4.46 billion, up 0.9% from $4.41 billion in the previous year. However, the company experienced a significant decline in net income, which fell to $205.9 million from $246.0 million in fiscal 2023, marking a decrease of 16.3%. The decline in profitability was attributed to a 7.1% drop in comparable store sales, driven by reduced consumer demand amid challenging macroeconomic conditions, including high interest rates and inflation, which have adversely affected the housing market.
In terms of operational developments, Floor & Decor opened 30 new warehouse-format stores during the fiscal year, bringing the total to 251 stores across 38 states. The company also operates five small-format design studios. Despite the expansion, the new stores have not performed as strongly as anticipated, with initial sales and profitability targets not being met, particularly for stores opened in 2022, 2023, and 2024. The company is focusing on reducing construction costs and operating expenses to optimize returns on these investments.
The company’s strategic initiatives include enhancing its product offerings and customer experience, particularly for professional customers, who represent approximately 49% of sales. Floor & Decor's online platform, which accounted for about 19% of total net sales, continues to be a critical component of its growth strategy. The company aims to leverage its extensive inventory, which averages around 4,400 stock keeping units (SKUs) per store, to maintain a competitive edge in the hard surface flooring market.
As of December 26, 2024, Floor & Decor employed approximately 13,690 individuals, with 11,717 working in stores. The company has emphasized training and development, with employees engaging in around 300,000 hours of training in 2024. Looking ahead, Floor & Decor plans to continue its expansion strategy, targeting the opening of 25 new warehouse-format stores in fiscal 2025, alongside investments in distribution centers and technology infrastructure. However, the company acknowledges the ongoing economic challenges and their potential impact on future performance, particularly in terms of consumer spending and housing market dynamics.
About Floor & Decor Holdings, Inc.
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