[PART I – FINANCIAL INFORMATION](index=4&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) This section provides the unaudited condensed consolidated financial statements and management's discussion and analysis of the company's financial condition and results of operations [Item 1. Condensed Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for the three and six months ended June 30, 2021, including the Balance Sheets, Statements of Operations, Comprehensive Income, Stockholders' Equity, and Cash Flows, showing significant increases in net sales and net income, alongside a notable decrease in total assets and liabilities due to debt repayment [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the company's condensed consolidated balance sheets, highlighting key asset, liability, and equity balances Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2021 | December 31, 2020 | | :--- | :--- | :--- | | **Assets** | | | | Cash and Cash Equivalents | $112,395 | $169,941 | | Merchandise Inventories | $223,907 | $244,409 | | Total Current Assets | $356,927 | $438,152 | | **Total Assets** | **$597,908** | **$674,348** | | **Liabilities & Equity** | | | | Total Current Liabilities | $245,404 | $242,255 | | Credit Agreement | $— | $101,000 | | **Total Liabilities** | **$346,843** | **$446,742** | | **Total Stockholders' Equity** | **$251,065** | **$227,606** | - Total assets decreased primarily due to a reduction in cash and cash equivalents. Total liabilities saw a significant decline following the full repayment of the **$101 million** outstanding on the Credit Agreement[8](index=8&type=chunk)[9](index=9&type=chunk) [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section details the company's condensed consolidated statements of operations, presenting net sales, gross profit, and net income Statement of Operations Highlights (in thousands, except per share amounts) | Metric | Q2 2021 | Q2 2020 | 6 Months 2021 | 6 Months 2020 | | :--- | :--- | :--- | :--- | :--- | | Total Net Sales | $301,384 | $230,284 | $584,834 | $497,658 | | Gross Profit | $112,730 | $88,292 | $228,322 | $193,263 | | Operating Income | $16,614 | $6,004 | $29,720 | $14,768 | | Net Income | $11,989 | $2,639 | $22,611 | $14,874 | | Diluted EPS | $0.41 | $0.09 | $0.77 | $0.51 | - The company experienced strong year-over-year growth in the second quarter and first half of 2021, with total net sales increasing **30.9%** and net income increasing over **350%** for the quarter[11](index=11&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section outlines the company's condensed consolidated statements of cash flows, categorizing cash movements from operating, investing, and financing activities Cash Flow Highlights for the Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2021 | 2020 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $53,334 | $105,667 | | Net Cash Used in Investing Activities | ($7,378) | ($6,263) | | Net Cash (Used in) Provided by Financing Activities | ($103,502) | $18,363 | | **Net (Decrease) Increase in Cash** | **($57,546)** | **$117,744** | - The primary use of cash in financing activities for the first six months of 2021 was the **$101 million** repayment on the Credit Agreement, contrasting with net borrowings in the same period of 2020[22](index=22&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed notes and disclosures that supplement the condensed consolidated financial statements - The company operates as a multi-channel specialty retailer of hard-surface flooring and accessories, with **416 stores** across **47 U.S. states** as of June 30, 2021[25](index=25&type=chunk)[33](index=33&type=chunk) Sales Mix by Major Product Category (Six Months Ended June 30) | Product Category | 2021 % of Sales | 2020 % of Sales | | :--- | :--- | :--- | | Manufactured Products | 46% | 46% | | Solid and Engineered Hardwood | 26% | 28% | | Moldings and Accessories | 15% | 16% | | Installation and Delivery Services | 13% | 10% | - On April 30, 2021, the Company amended its Credit Agreement, extending the maturity to April 2026 and securing more favorable terms. All **$101 million** of borrowings were repaid during the second quarter of 2021, leaving **$128.6 million** of availability[49](index=49&type=chunk)[52](index=52&type=chunk) [Note 7. Commitments and Contingencies](index=12&type=section&id=Note%207.%20Commitments%20and%20Contingencies) This section details the company's various legal proceedings, commitments, and contingent liabilities Accrual for Legal Matters and Settlements (in thousands) | Date | Balance | | :--- | :--- | | January 1, 2021 | $30,398 | | June 30, 2021 | $35,750 | - The company is involved in various legal proceedings, including class action lawsuits related to employment practices, product claims, and investigations into antidumping and countervailing duties[59](index=59&type=chunk) - A **$7 million** liability was accrued in Q1 2021 for a potential settlement in the Mason Lawsuit, alleging violations of the Fair Labor Standards Act[63](index=63&type=chunk) - The company is challenging Section 301 tariffs imposed on certain goods from China and, if successful, may qualify for refunds[95](index=95&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) Management discusses the strong financial performance in Q2 2021, highlighting a 30.9% increase in net sales and a 31.3% rise in comparable store sales, driven by strong pro customer and service demand, while addressing challenges including a 90 basis point decline in gross margin due to higher tariff, material, and transport costs, and ongoing supply chain constraints, noting the company's strong liquidity position with $241 million in total liquidity after repaying all $101 million of its debt [Second Quarter Financial Highlights](index=21&type=section&id=Second%20Quarter%20Financial%20Highlights) This section summarizes the company's key financial performance metrics and achievements for the second quarter - Net sales increased **30.9%** to **$301.4 million**, and total comparable store sales grew **31.3%** versus the prior-year period[107](index=107&type=chunk) - Gross margin decreased by **90 basis points** to **37.4%**, primarily due to higher tariffs, materials, and inbound transportation costs[107](index=107&type=chunk) - Operating margin improved by **290 basis points** to **5.5%**, and diluted EPS increased significantly to **$0.41** from **$0.09** in Q2 2020[107](index=107&type=chunk) - The company repaid all **$101.0 million** of its outstanding debt during the second quarter[107](index=107&type=chunk) [Results of Operations](index=23&type=section&id=Results%20of%20Operations) This section provides a detailed analysis of the company's operational performance, including sales, gross margin, and expenses - Q2 2021 net sales increased by **$71.1 million (30.9%)** YoY, driven by strong pro customer demand and a **106.8%** increase in net service sales as consumer comfort with in-home services returned[119](index=119&type=chunk) - Q2 gross margin decreased to **37.4%** from **38.3%** YoY, reflecting higher costs from tariffs, materials, and transportation, which were partially offset by strategic pricing and sourcing[121](index=121&type=chunk) - SG&A expenses as a percentage of sales improved by **380 basis points** to **31.9%** in Q2 2021, demonstrating significant operating leverage on higher sales volume compared to the cost-reduction actions taken in Q2 2020 due to COVID-19[126](index=126&type=chunk) [Liquidity, Capital Resources and Cash Flows](index=28&type=section&id=Liquidity%2C%20Capital%20Resources%20and%20Cash%20Flows) This section discusses the company's financial liquidity, capital resources, and cash flow management strategies - As of June 30, 2021, the company had total liquidity of **$241.0 million**, comprising **$112.4 million** in cash and **$128.6 million** available under its Revolving Credit Facility[108](index=108&type=chunk)[145](index=145&type=chunk) - Net cash from operating activities was **$53.3 million** for the first six months of 2021[146](index=146&type=chunk) - Capital expenditures for 2021 are expected to be between **$24 million** and **$28 million**, funding **12 to 15** new stores and digital investments[146](index=146&type=chunk) - Merchandise inventories decreased by **$20.5 million** from year-end 2020, primarily due to supply chain constraints and strong sales[149](index=149&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=30&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to interest rate risk through its cash investments and variable-rate Credit Agreement; however, as of June 30, 2021, there were no outstanding borrowings under the Credit Agreement, mitigating this risk, and the company does not currently use derivative financial instruments for hedging - The primary market risk is interest rate risk on cash equivalents and potential borrowings under the variable-rate Credit Agreement[153](index=153&type=chunk) - As of June 30, 2021, the company had no outstanding debt, minimizing its exposure to interest rate fluctuations on borrowings[153](index=153&type=chunk) [Item 4. Controls and Procedures](index=30&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of June 30, 2021, with no material changes to internal control over financial reporting occurring during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the quarter[155](index=155&type=chunk) - There were no changes in internal control over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, these controls[155](index=155&type=chunk) [PART II – OTHER INFORMATION](index=31&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) This section presents other required information, including legal proceedings, risk factors, equity sales, and filed exhibits [Item 1. Legal Proceedings](index=31&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 7 of the condensed consolidated financial statements for detailed information regarding the company's ongoing legal matters and contingencies - For detailed information on legal proceedings, refer to Note 7, "Commitments and Contingencies," in Part I, Item 1 of this report[156](index=156&type=chunk) [Item 1A. Risk Factors](index=31&type=section&id=Item%201A.%20Risk%20Factors) There are no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2020 - The company directs investors to review the risk factors discussed in its Annual Report on Form 10-K for the year ended December 31, 2020[157](index=157&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the quarter ended June 30, 2021, the company did not repurchase any shares as part of its publicly announced programs; however, it did repurchase 19,025 shares in connection with the net settlement of vested restricted shares - No shares were repurchased under publicly announced programs during the second quarter of 2021[159](index=159&type=chunk) - The company repurchased **19,025 shares** at an average price of **$23.04** to satisfy tax withholding obligations related to the vesting of restricted stock awards[159](index=159&type=chunk) [Item 6. Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the quarterly report, including CEO and CFO certifications pursuant to the Sarbanes-Oxley Act and financial statements formatted in XBRL - The exhibits filed with this report include certifications from the Principal Executive Officer and Principal Financial Officer as required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002[162](index=162&type=chunk)[163](index=163&type=chunk)[164](index=164&type=chunk)

Financial Data and Key Metrics - Net sales increased by 6% to $283.5 million in Q1 2021 compared to Q1 2020, driven by a 4.7% increase in merchandise sales and a 16.8% increase in service sales [28] - Comparable store sales increased by 6.9% in Q1 2021, reflecting strong demand for home improvement projects and growth in the installation business [6][28] - Operating income rose to $13.1 million in Q1 2021, up from $8.8 million in Q1 2020, with adjusted operating income increasing to $14.4 million or 5.1% of net sales [8][31] - Adjusted gross profit improved to $109 million in Q1 2021, with gross margin at 38.5%, down 80 basis points from Q1 2020 due to tariff impacts [16][29] - Net income decreased to $10.6 million in Q1 2021 from $12.2 million in Q1 2020, primarily due to a one-time tax benefit in 2020 [33] Business Line Performance - Installation sales accelerated year-over-year, with growth rates improving sequentially from Q4 2020, driven by strong demand for installation services [11][28] - Pro customer sales remained flat year-over-year, but the company saw higher sales and orders per pro through its trial, scale, and retention programs [13] - Web sales increased by over 70% year-over-year, driven by improvements in the digital platform and mobile app engagement [14] Market Performance - The company opened three new stores in Q1 2021, expanding into new and existing markets, with plans to open 12-15 new stores in 2021 [25][38] - Inventory constraints due to supply chain disruptions resulted in an estimated $8-9 million in lost sales in Q1 2021, similar to Q4 2020 [29][45] Strategic Direction and Industry Competition - The company is focused on four strategic pillars: people and culture, improving the customer experience, driving traffic and transactions, and improving profitability [9][17] - Efforts to diversify sourcing away from China have reduced the percentage of goods sourced from China to 23% in Q1 2021, mitigating tariff impacts [16][55] - The company is investing in digital marketing and rebranding efforts, with a focus on the LL Flooring brand to enhance customer awareness and consideration [16][20] Management Commentary on Operating Environment and Outlook - Management highlighted strong demand for home improvement projects, supported by favorable housing market trends and consumer savings [22] - Supply chain disruptions, including container shortages and domestic lumber constraints, are expected to persist through Q2 2021, with improvements anticipated in the second half of the year [22][45] - The company is cautiously monitoring consumer spending trends as the economy reopens, particularly the potential shift from home improvement to travel and leisure [24] Other Important Information - The company settled two employment litigation matters in April 2021, resulting in a $7.7 million liability accrued in Q1 2021 [30] - Liquidity improved significantly, with $209 million in cash and cash equivalents at the end of Q1 2021, up from $23 million a year ago [35][36] - The company amended its credit agreement, reducing interest expenses and extending the maturity date to April 2026 [37] Q&A Session Summary Question: Supply chain issues and their impact on sales and marketing [43] - Supply chain constraints, including container shortages and domestic lumber availability, are expected to persist through Q2 2021, with improvements anticipated in the second half of the year [44][45] - Marketing spend has been optimized for digital channels, aligning with the company's rebranding efforts [46][47] Question: Moderation in top-line growth in Q1 2021 [49] - The moderation in growth was influenced by a leap year sales event in 2020, severe winter weather in February 2021, and inventory constraints [51] Question: Tariff impacts on gross margins [52] - Tariffs are expected to continue impacting gross margins, but the company is mitigating these effects through pricing strategies and alternative sourcing [53][55] Question: Underlying demand trends and gross margin outlook [56][59] - Strong demand for home improvement projects is expected to continue, but the company is monitoring potential shifts in consumer spending as the economy reopens [57][58] - Gross margins will face pressure from higher transportation and raw material costs, but the company plans to offset these through pricing and promotion strategies [60][62] Question: Pro customer sales and product mix trends [66][70] - Pro customer sales are expected to grow as the company strengthens its value proposition and improves the Pro online experience [67][69] - Consumers are opting for higher ASP products, particularly in premium segments like solid wood and vinyl [71][72]

Lumber Liquidators Holdings, Inc. (NYSE:LL) Q4 2020 Earnings Conference Call March 1, 2021 8:00 AM ET Company Participants Julie MacMedan - Investor Relations Charles Tyson - President and Chief Executive Officer Nancy Walsh - Chief Financial Officer Conference Call Participants Laura Champine - Loop Capital Markets Brian Nagel - Oppenheimer Seth Basham - Wedbush Securities Peter Keith - Piper Sandler Operator Good morning, ladies and gentlemen and welcome to the Lumber Liquidators Fourth Quarter and Full Y ...

Lumber Liquidators Holdings, Inc. (NYSE:LL) Q3 2020 Results Conference Call November 2, 2020 8:00 AM ET Company Participants Danielle O'Brien - IR Charles Tyson - President and CEO Nancy Walsh - CFO Conference Call Participants Laura Champine - Loop Capital Markets David McGregor - Longbow Research Simeon Gutman - Morgan Stanley Brian Nagel - Oppenheimer Seth Basham - Wedbush Securities Peter Keith - Piper Sandler Operator Good morning, ladies and gentlemen, and welcome to the Lumber Liquidators Third Quart ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-33767 Lumber Liquidators Holdings, Inc. (Exact name of registrant as specified in its charter) | --- | --- | --- | | ...

Lumber Liquidators. (NYSE:LL) Q2 2020 Results Earnings Conference Call August 5, 2020 8:00 AM ET Company Participants Paul Taaffe - IR Nancy Taylor - Chairperson Charles Tyson - President and CEO Nancy Walsh - CFO Conference Call Participants Michael Tessler - Morgan Stanley Laura Champine - Loop Capital Markets Nathan Friedman - Wedbush Securities Operator Good morning, ladies and gentlemen, and welcome to Lumber Liquidators Second Quarter 2020 Earnings Conference Call. As a reminder, ladies and gentlemen, ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-33767 Lumber Liquidators Holdings, Inc. (Exact name of registrant as specified in its charter) | --- | --- | --- | |----- ...

Lumber Liquidators (NYSE:LL) Q1 2020 Results Conference Call May 28, 2020 8:30 AM ET Company Participants Paul Taaffe - IR Nancy Taylor - Chairperson Charles Tyson - President and CEO Nancy Walsh - CFO Conference Call Participants John Baugh - Stifel Laura Champine - Loop Capital Markets Simeon Gutman - Morgan Stanley Seth Basham - Wedbush Securities Bobby Friedner - Piper Sandler Operator Good morning, ladies and gentlemen, and welcome to Lumber Liquidators First Quarter 2020 Earnings Conference Call. As a ...