By Sabela Ojea
Flexsteel Industries raised its sales outlook for the year, but said the potential of 25% tariff hikes on Mexico could materially change its business outlook given its sizable operations in the country.
The furniture company on Monday said it is actively working on multiple plans, both short-term and mid-term, to minimize tariff risks.
"The current situation is dynamic, and the magnitude of the profit and free cash flow impact on our business is dependent on the ultimate amount and duration of tariffs as well as changes in foreign exchange rates," Chief Executive Derek Schmidt said.
Still, Schmidt said Flexsteel is encouraged by the improved traffic and sales seen by its retail partners during the holiday season. These trends provide optimism that demand declines may have bottomed and the industry could be positioned to start growing again, albeit modestly this year, he added.
Flexsteel guided for revenue of $435 million to $445 million for fiscal 2025 amid views for sales growth of 3% to 7% in the third quarter.
The company had previously said it expected full-year sales of $427 million to $440 million.
Write to Sabela Ojea at sabela.ojea@wsj.com; @sabelaojeaguix
(END) Dow Jones Newswires
February 03, 2025 17:09 ET (22:09 GMT)
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