Lumber Liquidators (LL) reported a surprise second-quarter-loss as its struggles over imported Chinese-made products continue to haunt it.
The flooring retailer said it was unable to provide an outlook for the full year and shares tumbled 28 percent Wednesday to a multiyear low.
The company suspended the sale of all laminate flooring from China this spring after "60 Minutes" reported that the flooring contained high levels of formaldehyde, a carcinogen. The company also disclosed that the Justice Department was seeking criminal charges against it in an investigation of violations of the Lacey Act, which covers wood sourcing.
Yet the publicity from the incident was damaging. Sales fell further than Wall Street had expected, which is likely to put more pressure on company founder Thomas Sullivan, who took control of the company in May following the abrupt departure of CEO Robert Lynch. William Schlegel, the company's chief merchandising officer, was fired in June. No reason was given.
Shares have fallen 80 percent this year.
Lumber Liquidators Holdings Inc., based in Toano, Virginia, lost $20.3 million, or 75 cents per share. That compares with a profit of $16.6 million, or 60 cents per share, a year ago.
Industry analysts had been expecting a per-share profit of 7 cents, according to a poll by Zacks Investment Research.
Revenue was $247.9 million, a decline of 5.8 percent from a year earlier and also short of the $256.9 million that Wall Street was looking for.
Sales at stores open at least a year fell 10 percent. This figure is a key indicator of a retailer's health because it excludes volatility from stores recently opened or closed.
Shares of Lumber Liquidators fell as low as $13.12 - their lowest point since 2008 - before ending regular trading at $13.27.