Leon's reports 23% increase in Q3 profit; revenue, systemwide sales also up

TORONTO – Leon’s Furniture Ltd (TSX:LNF) is reporting a 23 per cent increase in net income per share in the third quarter.

The Toronto-based operator and franchisor of furniture, electronics and appliance stores says net income was $27.3 million or 34 cents per diluted share in the three months ended Sept. 30, up from $21.8 million or 28 cents per diluted share in the comparable year earlier period. Leon’s said the earnings, which amounted to 38 cents per basic share, were a record for the quarter.

The company, whose banners include Leon’s and The Brick, said revenue rose to $531.7 million from $528.6 million.

System wide sales totalled $629.2 million, included $97.5 million franchise sales, versus $628.6 million, including $100 million of franchise sales, in 2013.

Same store sales were up one per cent compared with the prior year’s third quarter.

“Despite a difficult start in the first quarter of 2014, we are pleased by the increase in profits for the second and third quarter of 2014 versus the prior year,” the company said in its earnings release Thursday.

“We are also encouraged by the increase in same store sales in the third quarter 2014 compared to the prior year 2013,” it said, adding that integration and synergies between The Brick and Leon’s divisions were progressing as planned.

Good progress was also being made on a new computer system to be implemented over the next 15 months which will result in improved operating efficiencies in both divisions.

On the Toronto Stock Exchange, Leon’s shares closed up 22 cents or 1.55 per cent at $14.45 on Thursday.