Quarterly report [Sections 13 or 15(d)]



xml:lang="en-US">






false


--06-30


Q2


2021


0000037472
















0000037472



us-gaap:TreasuryStockMember





2020-10-01


2020-12-31






0000037472



us-gaap:TreasuryStockMember





2020-07-01


2020-09-30






0000037472



us-gaap:CommonStockMember





2020-10-01


2020-12-31






0000037472



us-gaap:AdditionalPaidInCapitalMember





2020-10-01


2020-12-31






0000037472



us-gaap:CommonStockMember





2019-10-01


2019-12-31






0000037472



us-gaap:AdditionalPaidInCapitalMember





2019-10-01


2019-12-31






0000037472



us-gaap:CommonStockMember





2019-07-01


2019-09-30






0000037472



us-gaap:AdditionalPaidInCapitalMember





2019-07-01


2019-09-30






0000037472



us-gaap:TreasuryStockMember





2020-12-31






0000037472



us-gaap:RetainedEarningsMember





2020-12-31






0000037472



us-gaap:AdditionalPaidInCapitalMember





2020-12-31






0000037472



us-gaap:TreasuryStockMember





2020-09-30






0000037472



us-gaap:RetainedEarningsMember





2020-09-30






0000037472



us-gaap:AdditionalPaidInCapitalMember





2020-09-30






0000037472




2020-09-30






0000037472



us-gaap:TreasuryStockMember





2020-06-30






0000037472



us-gaap:RetainedEarningsMember





2020-06-30






0000037472



us-gaap:AdditionalPaidInCapitalMember





2020-06-30






0000037472



us-gaap:RetainedEarningsMember





2019-12-31






0000037472



us-gaap:AdditionalPaidInCapitalMember





2019-12-31






0000037472



us-gaap:RetainedEarningsMember





2019-09-30






0000037472



us-gaap:AdditionalPaidInCapitalMember





2019-09-30






0000037472




2019-09-30






0000037472



srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember


us-gaap:RetainedEarningsMember





2019-06-30






0000037472



us-gaap:RetainedEarningsMember





2019-06-30






0000037472



us-gaap:AdditionalPaidInCapitalMember





2019-06-30






0000037472



us-gaap:AccumulatedOtherComprehensiveIncomeMember





2019-06-30






0000037472



srt:CumulativeEffectPeriodOfAdoptionAdjustmentMember





2019-06-30






0000037472



flxs:PriceRangeGroupTwoMember





2020-12-31






0000037472



flxs:PriceRangeGroupThreeMember





2020-12-31






0000037472



flxs:PriceRangeGroupOneMember





2020-12-31






0000037472



flxs:PriceRangeGroupFourMember





2020-12-31






0000037472



flxs:PriceRangeGroupFiveMember





2020-12-31






0000037472



flxs:PriceRangeAggregateMember





2020-12-31






0000037472



flxs:PriceRangeGroupTwoMember





2020-07-01


2020-12-31






0000037472



flxs:PriceRangeGroupThreeMember





2020-07-01


2020-12-31






0000037472



flxs:PriceRangeGroupOneMember





2020-07-01


2020-12-31






0000037472



flxs:PriceRangeGroupFourMember





2020-07-01


2020-12-31






0000037472



flxs:PriceRangeGroupFiveMember





2020-07-01


2020-12-31






0000037472



flxs:PriceRangeAggregateMember





2020-07-01


2020-12-31






0000037472



flxs:ChiefFinancialOfficerChiefOperatingOfficerMember


flxs:StockBasedCompensationOutsidePlanMember





2020-04-01


2020-06-30






0000037472



srt:ChiefExecutiveOfficerMember


flxs:StockBasedCompensationOutsidePlanMember





2018-10-01


2018-12-31






0000037472



us-gaap:PerformanceSharesMember


flxs:LongTermManagementIncentiveCompensationPlanMember





2020-12-31






0000037472



flxs:TimeBasedSharesMember


flxs:LongTermManagementIncentiveCompensationPlanMember





2020-12-31






0000037472



flxs:LongTermManagementIncentiveCompensationPlanMember





2020-12-31






0000037472



us-gaap:PerformanceSharesMember


flxs:LongTermManagementIncentiveCompensationPlanMember





2020-06-30






0000037472



flxs:TimeBasedSharesMember


flxs:LongTermManagementIncentiveCompensationPlanMember





2020-06-30






0000037472



flxs:RestrictedStockAndRestrictedStockUnitsRsusMember





2020-06-30






0000037472



flxs:LongTermManagementIncentiveCompensationPlanMember





2020-06-30






0000037472



us-gaap:PerformanceSharesMember


flxs:LongTermManagementIncentiveCompensationPlanMember





2020-07-01


2020-12-31






0000037472



flxs:TimeBasedSharesMember


flxs:LongTermManagementIncentiveCompensationPlanMember





2020-07-01


2020-12-31






0000037472



srt:MinimumMember


flxs:RestrictedStockAndRestrictedStockUnitsRsusMember





2020-07-01


2020-12-31






0000037472



srt:MaximumMember


flxs:RestrictedStockAndRestrictedStockUnitsRsusMember





2020-07-01


2020-12-31






0000037472



us-gaap:ShareBasedCompensationAwardTrancheThreeMember





2020-07-01


2020-12-31






0000037472



us-gaap:ShareBasedCompensationAwardTrancheOneMember





2020-07-01


2020-12-31






0000037472



flxs:LongTermManagementIncentiveCompensationPlanMember





2020-07-01


2020-12-31






0000037472



us-gaap:OtherRestructuringMember





2020-10-01


2020-12-31






0000037472



us-gaap:OperatingExpenseMember





2020-10-01


2020-12-31






0000037472



us-gaap:CostOfSalesMember





2020-10-01


2020-12-31






0000037472



flxs:InventoryImpairmentMember





2020-10-01


2020-12-31






0000037472



us-gaap:OperatingExpenseMember





2020-07-01


2020-12-31






0000037472



us-gaap:CostOfSalesMember





2020-07-01


2020-12-31






0000037472



us-gaap:OtherRestructuringMember





2019-10-01


2019-12-31






0000037472



us-gaap:OperatingExpenseMember





2019-10-01


2019-12-31






0000037472



us-gaap:OneTimeTerminationBenefitsMember





2019-10-01


2019-12-31






0000037472



us-gaap:CostOfSalesMember





2019-10-01


2019-12-31






0000037472



flxs:InventoryImpairmentMember





2019-10-01


2019-12-31






0000037472



us-gaap:OtherRestructuringMember





2019-07-01


2019-12-31






0000037472



us-gaap:OperatingExpenseMember





2019-07-01


2019-12-31






0000037472



us-gaap:OneTimeTerminationBenefitsMember





2019-07-01


2019-12-31






0000037472



us-gaap:CostOfSalesMember





2019-07-01


2019-12-31






0000037472



flxs:InventoryImpairmentMember





2019-07-01


2019-12-31






0000037472



us-gaap:OtherRestructuringMember





2020-12-31






0000037472



us-gaap:OneTimeTerminationBenefitsMember





2020-12-31






0000037472



flxs:InventoryImpairmentMember





2020-12-31






0000037472



us-gaap:OtherRestructuringMember





2020-06-30






0000037472



us-gaap:OneTimeTerminationBenefitsMember





2020-06-30






0000037472



us-gaap:EmployeeSeveranceMember





2020-06-30






0000037472



flxs:InventoryImpairmentMember





2020-06-30






0000037472



flxs:StarkvilleMississippiMember


us-gaap:DisposalGroupHeldforsaleNotDiscontinuedOperationsMember


us-gaap:LandAndLandImprovementsMember





2020-12-31






0000037472



flxs:StarkvilleMississippiMember


us-gaap:DisposalGroupHeldforsaleNotDiscontinuedOperationsMember


us-gaap:BuildingAndBuildingImprovementsMember





2020-12-31






0000037472



flxs:HarrisonArkansasMember


us-gaap:DisposalGroupHeldforsaleNotDiscontinuedOperationsMember


us-gaap:MachineryAndEquipmentMember





2020-12-31






0000037472



flxs:HarrisonArkansasMember


us-gaap:DisposalGroupHeldforsaleNotDiscontinuedOperationsMember


us-gaap:LandAndLandImprovementsMember





2020-12-31






0000037472



flxs:HarrisonArkansasMember


us-gaap:DisposalGroupHeldforsaleNotDiscontinuedOperationsMember


us-gaap:BuildingAndBuildingImprovementsMember





2020-12-31






0000037472



flxs:StarkvilleMississippiMember


us-gaap:DisposalGroupHeldforsaleNotDiscontinuedOperationsMember





2020-12-31






0000037472



flxs:HarrisonArkansasMember


us-gaap:DisposalGroupHeldforsaleNotDiscontinuedOperationsMember





2020-12-31






0000037472



us-gaap:DisposalGroupHeldforsaleNotDiscontinuedOperationsMember





2020-12-31






0000037472



us-gaap:OneTimeTerminationBenefitsMember





2020-07-01


2020-12-31






0000037472



us-gaap:EmployeeSeveranceMember





2020-07-01


2020-12-31






0000037472



us-gaap:AccumulatedOtherComprehensiveIncomeMember





2019-07-01


2019-09-30






0000037472



flxs:EmploymentMattersMember





2019-06-30






0000037472




2016-08-31






0000037472



flxs:EmploymentMattersMember





2018-07-01


2019-06-30






0000037472



flxs:InterestRateThreeMember





2020-08-28






0000037472



flxs:InterestRateThreeMember





2020-12-31






0000037472




2018-06-30






0000037472




2018-03-01


2018-03-31






0000037472




2017-07-01


2017-07-31






0000037472



us-gaap:EmployeeStockOptionMember





2020-12-31






0000037472



us-gaap:RestrictedStockUnitsRSUMember


flxs:LongTermManagementIncentiveCompensationPlanMember





2020-07-01


2020-12-31






0000037472



srt:ChiefExecutiveOfficerMember


flxs:StockBasedCompensationOutsidePlanMember





2020-07-01


2020-12-31






0000037472



us-gaap:EmployeeStockOptionMember





2020-07-01


2020-12-31






0000037472



flxs:RestrictedStockAndRestrictedStockUnitsRsusMember





2020-07-01


2020-12-31






0000037472



us-gaap:RestrictedStockUnitsRSUMember


flxs:LongTermManagementIncentiveCompensationPlanMember





2020-12-31






0000037472



srt:ChiefExecutiveOfficerMember


flxs:StockBasedCompensationOutsidePlanMember





2020-12-31






0000037472



flxs:RestrictedStockAndRestrictedStockUnitsRsusMember





2020-12-31






0000037472



us-gaap:RetainedEarningsMember





2020-10-01


2020-12-31






0000037472



us-gaap:RetainedEarningsMember





2020-07-01


2020-09-30






0000037472



us-gaap:RetainedEarningsMember





2019-10-01


2019-12-31






0000037472



us-gaap:RetainedEarningsMember





2019-07-01


2019-09-30






0000037472




2019-07-01


2019-09-30






0000037472



flxs:InterestRateThreeMember





2020-07-01


2020-12-31






0000037472



srt:MinimumMember


flxs:InterestRateThreeMember





2020-08-28






0000037472



flxs:InterestRateThreeMember


us-gaap:LondonInterbankOfferedRateLIBORMember





2020-08-28


2020-08-28






0000037472



us-gaap:CommonStockMember





2020-12-31






0000037472



us-gaap:CommonStockMember





2020-09-30






0000037472



us-gaap:CommonStockMember





2020-06-30






0000037472



us-gaap:CommonStockMember





2019-12-31






0000037472



us-gaap:CommonStockMember





2019-09-30






0000037472



us-gaap:CommonStockMember





2019-06-30






0000037472




2019-10-01


2019-12-31






0000037472




2019-12-31






0000037472




2019-06-30






0000037472




2020-10-01


2020-12-31






0000037472




2020-12-31






0000037472




2020-06-30






0000037472



us-gaap:CommonStockMember





2020-07-01


2020-09-30






0000037472



us-gaap:AdditionalPaidInCapitalMember





2020-07-01


2020-09-30






0000037472




2020-07-01


2020-09-30






0000037472



us-gaap:EmployeeStockOptionMember


flxs:StockOptionPlansMember





2020-07-01


2020-12-31






0000037472



us-gaap:OtherRestructuringMember





2020-07-01


2020-12-31






0000037472



flxs:InventoryImpairmentMember





2020-07-01


2020-12-31






0000037472



flxs:ExitCommercialOfficeAndCustomDesignedHospitalityProductLinesMember





2020-06-30






0000037472



flxs:ExitCommercialOfficeAndCustomDesignedHospitalityProductLinesMember





2020-07-01


2020-12-31






0000037472




2019-07-01


2019-12-31






0000037472



flxs:EmploymentMattersMember





2020-07-01


2020-12-31






0000037472



flxs:InterestRateOneMember





2020-12-31






0000037472




2021-01-27






0000037472




2020-07-01


2020-12-31





xbrli:pure






iso4217:USD




xbrli:shares






flxs:plaintiff




flxs:item




iso4217:USD




xbrli:shares










UNITED STATES




SECURITIES AND EXCHANGE COMMISSION




WASHINGTON, D. C. 20549




______________________________________




FORM



10-Q





______________________________________






þ




Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934




For the quarterly period ended



December 31, 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



0-5151





______________________________________





FLEXSTEEL INDUSTRIES, INC.





(Exact Name of Registrant as Specified in Its Charter)





































Incorporated in State of



Minnesota







42-0442319






(State or other Jurisdiction of





(I.R.S. Identification No.)





Incorporation or Organization)












385 BELL STREET






DUBUQUE



,



IA






52001-0877





(Address of Principal Executive Offices) (Zip Code)








(



563



)



556-7730





(Registrant’s Telephone Number, Including Area Code)




______________________________________




Securities registered pursuant to Section 12(b) of the Act:





































Title of each class





Trading Symbol(s)





Name of each exchange on which registered






Common Stock







FLXS







The Nasdaq Stock Market, LLC











Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.



Yes






þ



No



¨









Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).



Yes






þ



No



¨









Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act (check one).




Large Accelerated Filer



¨






Accelerated Filer






þ



Non-Accelerated Filer



¨



Smaller Reporting Company




þ




Emerging Growth Company




¨










If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.



¨









Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes



¨



No




þ



































Common Stock - $1.00 Par Value










Shares Outstanding as of January 27, 2021






7,061,152





























FLEXSTEEL INDUSTRIES, INC.




QUARTERLY REPORT ON FORM 10-Q




FOR THE QUARTER ENDED DECEMBER 31, 2020


























































































































Page





Part I – Financial Information





Item 1.






Financial Statements






3











Consolidated Balance Sheets as of December 31, 2020 and June 30, 2020 (Unaudited)






3











Consolidated Statements of Income for the three and six months ended December 31, 2020 and December 31, 2019 (Unaudited)






4











Consolidated Statements of Comprehensive Income for the three and six months ended December 31, 2020 and December 31, 2019 (Unaudited)






4











Consolidated Statements of Changes in Shareholders’ Equity for the three and six months ended December 31, 2020 and December 31, 2019 (Unaudited)






5











Consolidated Statements of Cash Flows for the six months ended December 31, 2020 and December 31, 2019 (Unaudited)






6











Notes to Consolidated Financial Statements (Unaudited)






7





Item 2.






Management’s Discussion and Analysis of Financial Condition and Results of Operations






14





Item 3.






Quantitative and Qualitative Disclosures About Market Risk






17





Item 4.






Controls and Procedures






17





Part II – Other Information





Item 1A.






Risk Factors






18





Item 2A.






Unregistered Sales of Equity Securities and Use of Proceeds






18





Item 6.






Exhibits






18






Signatures











19


























2














PART I FINANCIAL INFORMATION









Ite




m 1.



Financial


Statements








FLEXSTEEL INDUSTRIES, INC. AND SUBSIDIARIES






CONSOLIDATED BALANCE SHEETS


(UNAUDITED)




(Amounts in thousands)


























































































































































































































































































































































































































































































December 31,










June 30,















2020










2020





ASSETS



































CURRENT ASSETS:



































Cash and cash equivalents










$








33,296











$








48,197






Trade receivables - less allowances: December 31, 2020, $



3,110



; June 30, 2020, $



1,770



















46,317



















32,217






Inventories


















92,024



















70,565






Other


















12,496



















18,535






Assets held for sale


















666



















12,329






Total current assets


















184,799



















181,843






NONCURRENT ASSETS:



































Property, plant and equipment, net


















40,251



















43,312






Operating lease right-of-use assets


















9,463



















8,683






Deferred income taxes


































2,111






Other assets


















1,299



















1,310






TOTAL ASSETS










$








235,812











$








237,259









































LIABILITIES AND SHAREHOLDERS' EQUITY



































CURRENT LIABILITIES:



































Accounts payable - trade










$








27,842











$








27,747






Current portion of operating lease liabilities


















4,155



















4,408






Accrued liabilities:



































Payroll and related items


















8,210



















3,275






Insurance


















3,201



















3,787






Restructuring costs


















1,418



















1,961






Advertising


















5,231



















3,823






Environmental remediation


















3,570



















3,600






Other


















4,849



















4,861






Total current liabilities


















58,476



















53,462






LONG-TERM LIABILITIES:



































Operating lease liabilities, less current maturities


















8,000



















7,607






Other liabilities


















929



















685






Total liabilities


















67,405



















61,754









































SHAREHOLDERS' EQUITY:



































Common stock - $




1




par value; authorized




15,000




shares;



8,082



shares issued and








7,087



outstanding as of December 31, 2020;



8,008



shares issued and








7,876



outstanding as of June 30, 2020


















8,082



















8,008






Additional paid-in capital


















33,373



















31,748






Treasury stock, at cost;



995



shares and



132



shares as of December 31, 2020 and







June 30, 2020, respectively















(



21,576



)















(



1,563



)





Retained earnings


















148,528



















137,312






Total shareholders' equity


















168,407



















175,505






TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY










$








235,812











$








237,259











See accompanying Notes to Consolidated Financial Statements (Unaudited).











3














FLEXSTEEL INDUSTRIES, INC. AND SUBSIDIARIES






CONSOLIDATED STATEMENTS OF INCOME


(UNAUDITED)




(Amounts in thousands, except per share data)




















































































































































































































































































































































































































Three Months Ended










Six Months Ended















December 31,










December 31,















2020










2019










2020










2019





Net sales










$








119,106











$








102,949











$








224,345











$








203,297






Cost of goods sold


















94,728



















86,899



















177,152



















170,026






Gross margin


















24,378



















16,050



















47,193



















33,271






Selling, general and administrative


















18,911



















18,088



















33,086



















35,563






Restructuring expense


















863



















5,067



















2,244



















11,071






Gain on disposal of assets due to restructuring















(



5,229



)















(



26



)















(



5,881



)















(



18,967



)





Operating income (loss)


















9,833
















(



7,079



)


















17,744



















5,604






Other income


















162



















107



















211



















193






Income (loss) before income taxes


















9,995
















(



6,972



)


















17,955



















5,797






Income tax provision (benefit)


















1,545
















(



1,588



)


















5,626



















1,630






Net income (loss)










$








8,450











$





(



5,384



)










$








12,329











$








4,167






Weighted average number of common shares outstanding:

































































Basic


















7,246



















7,944



















7,475



















7,936






Diluted


















7,495



















7,944



















7,681



















8,146






Earnings (loss) per share of common stock:

































































Basic










$








1.17











$





(



0.68



)










$








1.65











$








0.53






Diluted










$








1.13











$





(



0.68



)










$








1.61











$








0.51












































































See accompanying Notes to Consolidated Financial Statements (Unaudited).












CONSOLIDATED




STATEMENTS OF COMPREHENSIVE


INCOME (UNAUDITED)




(Amounts in thousands)






































































































































































































































































































































Three Months Ended










Six Months Ended















December 31,










December 31,















2020










2019










2020










2019





Net income (loss)










$








8,450











$





(



5,384



)










$








12,329











$








4,167






Other comprehensive loss:

































































Unrealized loss on securities































(



5



)































(



18



)





Reclassification of realized loss on securities to




other income


































5



































7






Unrealized losses in securities before taxes































































(



11



)





Income tax benefit related to securities losses


































































3






Other comprehensive loss, net of tax































































(



8



)





Comprehensive income (loss)










$








8,450











$





(



5,384



)










$








12,329











$








4,159















See accompanying Notes to Consolidated Financial Statements (Unaudited).
























4


















FLEXSTEEL INDUSTRIES, INC. AND SUBSIDIARIES






CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY


(UNAUDITED)




(Amounts in thousands)








































































































































































































































































































































































































































































































































Six Months Ended December 31, 2020















Total Par











































































Value of










Additional




























































Common










Paid-In










Treasury










Retained






























Shares ($





1





Par)










Capital










Stock










Earnings










Total





Balance at June 30, 2020










$








8,008











$








31,748











$





(



1,563



)










$








137,312











$








175,505






Stock-based compensation


















2



















954



















































956






Vesting of restricted stock units and restricted shares


















55
















(



387



)













































(



332



)





Treasury stock purchases















































(



9,000



)































(



9,000



)





Cash dividends declared































































(



383



)















(



383



)





Net income


































































3,879



















3,879






Balance at September 30, 2020










$








8,065











$








32,315











$





(



10,563



)










$








140,808











$








170,625






Stock-based compensation


















10



















1,017



















































1,027






Stock options exercised


















7



















41



















































48






Treasury stock purchases















































(



11,013



)































(



11,013



)





Cash dividends declared































































(



730



)















(



730



)





Net income


































































8,450



















8,450






Balance at December 31, 2020










$








8,082











$








33,373











$





(



21,576



)










$








148,528











$








168,407


































































































































































































































































































Six Months Ended December 31, 2019















Total Par








































Accumulated






























Value of










Additional

























Other






























Common










Paid-In










Retained










Comprehensive






























Shares ($





1





Par)










Capital










Earnings










(Loss) Income










Total





Balance at June 30, 2019










$








7,903











$








27,512











$








170,004











$








8











$








205,427






Adoption of ASU 2016-02















































(



42



)































(



42



)





Unrealized gain on available for sale investments,







net of tax































































(



8



)















(



8



)





Stock-based compensation


















39



















1,310



















































1,349






Cash dividends declared















































(



1,754



)































(



1,754



)





Net income