Lumber Liquidators 2015 Annual Report Download - page 43

Year Ended December 31,
2015 2014 2013 2012 2011
(dollars in thousands, except per share amounts)
Balance Sheet Data
Cash and cash equivalents .......... $ 26,703 $ 20,287 $ 80,634 $ 64,167 $ 61,675
Merchandise inventories ........... 244,402 314,371 252,428 206,704 164,139
Total assets .................... 456,202 493,462 429,559 347,387 294,854
Customer deposits and store credits .... 33,771 34,943 22,377 25,747 18,120
Total debt and capital lease obligations,
including current maturities ....... 20,000——— —
Total stockholders’ equity .......... 277,568 332,054 309,329 234,541 215,084
Working capital ................. 195,044 213,030 245,207 187,118 167,248
Other Data
Total stores in operation ........... 374 352 318 288 263
Average sales ................... $ 1,625 $ 1,675 $ 1,705 $ 1,600 $ 1,560
(1) Working capital is defined as current assets minus current liabilities.
(2) Average sale, calculated on a total company basis, is defined as the average invoiced sale per customer,
measured on a monthly basis and excluding transactions of less than $250 (which are generally sample
orders, or add-ons or fill-ins to previous orders) and of more than $30,000 (which are usually contractor
orders).
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Overview
Lumber Liquidators is the largest specialty retailer of hardwood flooring in North America, offering a
complete purchasing solution across an extensive assortment of exotic and domestic hardwood species,
engineered hardwood, laminate, resilient vinyl, bamboo and cork. At December 31, 2015, we sold our
products through 374 Lumber Liquidators stores in 46 states in the United States (‘‘U.S.’’) and in Canada, a
call center, websites and catalogs.
We believe we have achieved a reputation for offering great value, superior service and a broad selection
of high-quality hardwood flooring products. With a balance of price, selection, quality, availability and service,
we believe our value proposition is the most complete within a highly-fragmented hardwood flooring market.
The foundation for our value proposition is strengthened by our unique store model, the industry expertise of
our people, our singular focus on hard-surface flooring and our expansion of our advertising reach and
frequency.
Executive Summary
For the fiscal year ended December 31, 2015 we reported a net loss of $56.4 million, or $(2.08) per
diluted share, compared to net income of $63.4 million, or $2.31 per diluted share in the year ended
December 31, 2014. Our operating results for the year ended December 31, 2015 included:
• Expenses of $9.4 million related to the purchase of testing kits and professional fees in connection
with our indoor air quality testing program,
• Incremental legal and professional fees and settlement expenses, related to our defense of various
legal matters of approximately $37.0 million,
• Asset impairment charges and other expenses related to the simplification of our business totaling
approximately $10.9 million,
• Employee retention expenses totaling approximately $5.3 million and
• Write down of our laminates and associated moldings sourced from China totaling approximately
$22.5 million.
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