0000057131-20-000070 | 10-Q | XBRL Viewer

Stock issued for stock and employee benefit plans, net of cancellations and withholding tax

767

281

486

(1,417)

126

(1,669)

Repurchases of 391 shares of common stock

(12,313)

(391)

(3,762)

(8,160)

Stock option and restricted stock expense

1,675

Dividends declared and paid

^[1]

547

(547)

(6,112)

Ending balance at Jul. 27, 2019

698,138

46,690

311,207

329,096

(3,728)

14,873

Beginning balance at Apr. 25, 2020

716,306

45,857

318,215

343,633

(6,952)

15,553

Increase (Decrease) in Stockholders' Equity

Net income (loss)

4,679

4,798

(119)

Stock issued for stock and employee benefit plans, net of cancellations and withholding tax

2,218

1,720

498

(1,749)

132

(195)

(1,686)

Stock option and restricted stock expense

2,047

Dividends declared and paid

^[2]

(8,502)

(8,507)

Ending balance at Jul. 25, 2020

$ 714,999

$ 45,989

$ 320,067

$ 346,750

$ (5,232)

$ 7,425

[1]	Income tax effects of the Tax Cuts and Jobs Act are reclassified from Accumulated Other Comprehensive Income ("AOCI") to retained earnings due to the adoption of ASU 2018-02.
[2]	dividends to shareholders were declared or paid during the first quarter of fiscal 2021; amount includes dividends forfeited from restricted stock awards previously granted. Non-controlling interests include dividends paid to joint venture minority partners resulting from the repatriation of dividends from our foreign earnings that we no longer consider permanently reinvested.

- Definition

The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 1A
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=118930883&loc=SL7669619-108580

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 810
-SubTopic 10
-Section 50
-Paragraph 1A
-Subparagraph (a)(1)
-URI http://asc.fasb.org/extlink&oid=109239629&loc=SL4573702-111684

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 1B
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=118930883&loc=SL7669625-108580

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 810
-SubTopic 10
-Section 50
-Paragraph 1A
-Subparagraph (c)(1)
-URI http://asc.fasb.org/extlink&oid=109239629&loc=SL4573702-111684

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-URI http://asc.fasb.org/extlink&oid=115929826&loc=d3e8736-108599

Reference 6: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 810
-SubTopic 10
-Section 55
-Paragraph 4J
-URI http://asc.fasb.org/extlink&oid=116874947&loc=SL4591551-111686

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 230
-SubTopic 10
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=118932676&loc=d3e3000-108585

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 810
-SubTopic 10
-Section 45
-Paragraph 19
-URI http://asc.fasb.org/extlink&oid=108774443&loc=SL4569616-111683

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=115929826&loc=d3e8933-108599

Reference 10: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 810
-SubTopic 10
-Section 55
-Paragraph 4K
-URI http://asc.fasb.org/extlink&oid=116874947&loc=SL4591552-111686

+ Details

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (Parenthetical) - $ / shares shares in Thousands	3 Months Ended
	Jul. 25, 2020	Jul. 27, 2019
Dividends declared (in dollars per share)	$ 0	$ 0.13
Dividends paid (in dollars per share)	$ 0	$ 0.13
Common Shares
Shares purchased (in shares)		391

Basis of Presentation

3 Months Ended

Jul. 25, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

The accompanying consolidated financial statements include the consolidated accounts of La-Z-Boy Incorporated and our majority-owned subsidiaries (collectively, the "Company"). We derived the April 25, 2020, balance sheet from our audited financial statements. We prepared the interim financial information in conformity with generally accepted accounting principles, which we applied on a basis consistent with those reflected in our fiscal 2020 Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”), but the information does not include all of the disclosures required by generally accepted accounting principles. In management’s opinion, the interim financial information includes all adjustments and accruals, consisting only of normal recurring adjustments (except as otherwise disclosed), that are necessary for a fair statement of results for the respective interim periods. The interim results reflected in the accompanying financial statements are not necessarily indicative of the results of operations that will occur for the full fiscal year ending April 24, 2021.

At July 25, 2020, we owned preferred shares and warrants to purchase common shares of two privately held companies, both of which are variable interest entities. We have not consolidated their results in our financial statements because we do not have the power to direct those activities that most significantly impact their economic performance and, therefore, are not the primary beneficiary.

COVID-19

As a part of our continued response to the impact of COVID-19, on June 4, 2020, we announced our business realignment plan, which included the immediate reduction of the Company's global workforce by approximately 10% across our manufacturing, retail and corporate locations, including the closure of our Newton, Mississippi upholstery manufacturing facility. Production from the Newton facility has been shifted to available capacity at the company’s Dayton, Tennessee, Neosho, Missouri, and Siloam Springs, Arkansas plants. In the first quarter of fiscal 2021, we incurred expenses of $3.5 million associated with our business realignment plan, primarily due to severance costs and an impairment of the carrying value of the Newton manufacturing facility.

Given the positive trends in cash flows, during the first quarter of fiscal 2021, we repaid $25.0 million of the $75.0 million borrowed under our line of credit in the fourth quarter of 2020. Subsequent to this financial report, in the second quarter of fiscal 2021, effective as of August 1, 2020, the temporary 50% salary reductions for the named executive officers ended and full base salaries were reinstated, as was the Company's 401(k) match and cash compensation for the board of directors. Further, on August 18, 2020, the board of directors elected to reinstate a regular quarterly dividend to shareholders of $0.07 per share, 50% of the dividend amount paid quarterly prior to the Company's suspension of dividends. We continue to actively manage the impact of the COVID-19 crisis and there is uncertainty regarding the impact COVID-19 will have on our financial operations in the near and long term.

Accounting pronouncement adopted in fiscal 2021

The following table summarizes additional ASUs which were adopted in fiscal 2021, but did not have a material impact on our accounting policies or our consolidated financial statements and related disclosures.



ASU		Description
ASU 2016-13		Financial Instruments – Credit losses (Topic 326): Measurement of Credit Losses on Financial Instruments
ASU 2020-04		Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting

Accounting pronouncements not yet adopted

The following table summarizes additional accounting pronouncements which we have not yet adopted, but we believe will not have a material impact on our accounting policies or our consolidated financial statements and related disclosures.



ASU	Description	Adoption Date
ASU 2018-14	Compensation – Retirement benefits – Defined Benefit Plans – General (Subtopic 715-20): Changes to the Disclosure Requirements for Defined Benefit Plans	Fiscal 2022
ASU 2019-12	Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes	Fiscal 2022
ASU 2020-01	Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815): Clarifying the Interactions between Topic 321, Topic 323, and Topic 815	Fiscal 2022

Restricted Cash

3 Months Ended

Jul. 25, 2020

Cash and Cash Equivalents [Abstract]

Restricted Cash

We have restricted cash on deposit with a bank as collateral for certain letters of credit. All our letters of credit have maturity dates within the next twelve months, but we expect to renew some of these letters of credit when they mature.



(Unaudited, amounts in thousands)	7/25/20		7/27/19
Cash and cash equivalents	$	334,204	$	111,622
Restricted cash	2,476		1,970
Total cash, cash equivalents and restricted cash	$	336,680	$	113,592

Inventories

3 Months Ended

Jul. 25, 2020

Inventory Disclosure [Abstract]

Inventories

A summary of inventories is as follows:



(Unaudited, amounts in thousands)	7/25/20			4/25/20
Raw materials	$	90,414		$	92,174
Work in process	14,897			14,064
Finished goods	96,535			96,850
FIFO inventories	201,846			203,088
Excess of FIFO over LIFO	(21,445		)	(21,445		)
Total inventories	$	180,401		$	181,643

Goodwill and Other Intangible Assets

3 Months Ended

Jul. 25, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

We have goodwill on our consolidated balance sheet as follows:



Reportable Segment/Unit	Reporting Unit	Related Acquisition
Wholesale Segment	La-Z-Boy United Kingdom	Wholesale business in the United Kingdom and Ireland
Retail Segment	Retail	La-Z-Boy Furniture Galleries^® stores
Corporate & Other	Joybird	Joybird

The following is a summary of activity of goodwill for the quarter ended July 25, 2020:



(Unaudited, amounts in thousands)	Wholesale Segment		Retail Segment		Corporate and Other		Total Goodwill
Balance at April 25, 2020	$	11,630	$	93,941	$	55,446	$	161,017
Translation adjustment	408		172		—		580
Balance at July 25, 2020	$	12,038	$	94,113	$	55,446	$	161,597

We have intangible assets on our consolidated balance sheet as follows:



Reportable Segment/Unit	Intangible Asset	Useful Life
Wholesale Segment	Primarily acquired customer relationships from our acquisition of the wholesale business in the United Kingdom and Ireland	Amortizable over useful lives that do not exceed 15 years
Wholesale Segment	American Drew^® trade name	Indefinite-lived
Retail Segment	Reacquired rights to own and operate La-Z-Boy Furniture Galleries^® stores	Indefinite-lived
Corporate & Other	Joybird^® trade name	Amortizable over eight-year useful life

The following is a roll-forward of our other intangible assets for the quarter ended July 25, 2020:



(Unaudited, amounts in thousands)	Indefinite- Lived Trade Names		Finite- Lived Trade Name			Indefinite- Lived Reacquired Rights		Other Intangible Assets			Total Other Intangible Assets
Balance at April 25, 2020	$	1,155	$	5,003		$	19,996	$	2,499		$	28,653
Amortization	—		(199		)	—		(54		)	(253		)
Translation adjustment	—		—			128		86			214
Balance at July 25, 2020	$	1,155	$	4,804		$	20,124	$	2,531		$	28,614

We test indefinite-lived intangibles and goodwill for impairment on an annual basis in the fourth quarter of each fiscal year, and more frequently if events or changes in circumstances indicate that an asset might be impaired. We test amortizable intangible assets for impairment if events or changes in circumstances indicate that the assets might be impaired.

Investments

3 Months Ended

Jul. 25, 2020

Investments, Debt and Equity Securities [Abstract]

Investments

We have current and long-term investments intended to enhance returns on our cash as well as to fund future obligations of our non-qualified defined benefit retirement plan, our executive deferred compensation plan, and our performance compensation retirement plan. We also hold other investments consisting of cost-basis preferred shares of two privately held start-up companies. Our short-term investments are included in other current assets and our long-term investments are included in other long-term assets on our consolidated balance sheet.

The following summarizes our investments:



(Unaudited, amounts in thousands)	7/25/20		4/25/20
Short-term investments:
Marketable securities	$	9,340	$	18,634
Held-to-maturity investments	2,476		3,337
Total short-term investments	11,816		21,971
Long-term investments:
Marketable securities	18,463		19,572
Cost basis investments	7,579		6,479
Total long-term investments	26,042		26,051
Total investments	$	37,858	$	48,022

Investments to enhance returns on cash	$	16,494	$	28,622
Investments to fund compensation/retirement plans	13,785		12,921
Other investments	7,579		6,479
Total investments	$	37,858	$	48,022

The following is a summary of the unrealized gains, unrealized losses, and fair value by investment type:



	7/25/20							4/25/20
(Unaudited, amounts in thousands)	Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Equity securities	$	1,575	$	(19	)	$	14,463	$	1,011	$	(6,390	)	$	12,692
Fixed income	274		(7		)	19,058		268		(56		)	30,213
Other	399		—			4,337		372		—			5,117
Total securities	$	2,248	$	(26	)	$	37,858	$	1,651	$	(6,446	)	$	48,022

The following table summarizes sales of marketable securities:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Proceeds from sales	$	13,725		$	4,060
Gross realized gains	126			6
Gross realized losses	(18		)	(2		)

The following is a summary of the fair value of fixed income marketable securities, classified as available-for-sale securities, by contractual maturity:



(Unaudited, amounts in thousands)	7/25/20
Within one year	$	9,366
Within two to five years	6,583
Within six to ten years	1,266
Thereafter	1,843
Total	$	19,058

Accrued Expenses and Other Current Liabilities

3 Months Ended

Jul. 25, 2020

Payables and Accruals [Abstract]

Accrued Expenses and Other Current Liabilities



(Unaudited, amounts in thousands)	7/25/20		4/25/20
Payroll and other compensation	$	39,562	$	34,980
Accrued product warranty, current portion	14,237		14,264
Customer deposits	101,771		40,721
Deferred revenue	39,747		17,086
Other current liabilities	52,913		48,231
Accrued expenses and other current liabilities	$	248,230	$	155,282

The increase in customer deposits and deferred revenue was primarily driven by higher written Retail and Joybird sales in the first quarter of fiscal 2021. Higher written sales also led to an increase in contract assets, which are included in other current assets on the consolidated balance sheet, consistent with the increase in deferred revenue. Refer to Note 10, Revenue Recognition, for additional details regarding our contract assets and contract liabilities.

Product Warranties

3 Months Ended

Jul. 25, 2020

Product Warranties Disclosures [Abstract]

Product Warranties

We accrue an estimated liability for product warranties when we recognize revenue on the sale of warranted products. We estimate future warranty claims on new sales based on our historical claims experience and any additional anticipated future costs on previously sold products. We incorporate repair costs into our liability estimates, including materials, labor and overhead amounts necessary to perform repairs and any costs associated with delivering repaired product to our customers. Over 90% of our warranty liability relates to our Wholesale segment as we generally warrant our products against defects for one year on fabric and leather, from one to ten years on cushions and padding, and provide a limited lifetime warranty on certain mechanisms and frames. Our Wholesale segment warranties cover labor costs relating to our parts for one year. We provide a limited lifetime warranty against defects on a majority of Joybird products, which are a part of our Corporate and Other results. For all our manufacturer warranties, the warranty period begins when the consumer receives our product. We use

considerable judgment in making our estimates, and we record differences between our actual and estimated costs when the differences are known.

A reconciliation of the changes in our product warranty liability is as follows:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Balance as of the beginning of the period	$	23,255		$	22,736
Accruals during the period	3,828			5,657
Settlements during the period	(3,960		)	(5,557		)
Balance as of the end of the period (1)	$	23,123		$	22,836


(1)	$14.2 million and $14.3 million recorded in accrued expenses and other current liabilities as of July 25, 2020 and April 25, 2020, respectively, while the remainder is in included in other long-term liabilities.

We recorded accruals during the periods presented in the table above, primarily to reflect charges that relate to warranties issued during the respective periods.

Stock-Based Compensation

3 Months Ended

Jul. 25, 2020

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

The table below summarizes the total stock-based compensation expense we recognized for all outstanding grants in our consolidated statement of income:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20		7/27/19
Equity-based awards expense	$	2,047	$	1,675
Liability-based awards expense	584		(60		)
Total stock-based compensation expense	$	2,631	$	1,615

Stock Options. We granted 315,584 stock options to employees during the first quarter of fiscal 2021 and we have stock options outstanding from previous grants. We account for stock options as equity-based awards because when they are exercised, they will be settled in common shares. We recognize compensation expense for stock options over the vesting period equal to the fair value on the date our Compensation Committee approved the awards. The vesting period for our stock options ranges from one to four years, with accelerated vesting upon retirement. The vesting date for retirement-eligible employees is the later of the date they meet the criteria for retirement or the end of the fiscal year in which the grant was made. We accelerate the expense for options granted to retirement-eligible employees over the vesting period, with expense recognized from the grant date through their retirement eligibility date or over the ten months following the grant date, whichever period is longer. We have elected to recognize forfeitures as an adjustment to compensation expense in the same period as the forfeitures occur.

We estimate the fair value of the employee stock options at the date of grant using the Black-Scholes option-pricing model, which requires management to make certain assumptions. The fair value of stock options granted during the first quarter of fiscal 2021 were calculated using the following assumptions:



(Unaudited)	Fiscal 2021 grant			Assumption
Risk-free interest rate	0.34		%	U.S. Treasury issues with term equal to expected life at grant date
Dividend rate	0		%	Estimated future dividend rate and common share price at grant date
Expected life in years	5			Contractual term of stock option and expected employee exercise trends
Stock price volatility	41.79		%	Historical volatility of our common shares
Fair value per share	$	10.06

Stock Appreciation Rights (“SARs”). We have not granted any SARs to employees since fiscal 2014, but we have SARs outstanding from the fiscal 2013 and fiscal 2014 grants. All outstanding SARs are fully vested and have a term of ten years. SARs will be paid in cash upon exercise and, accordingly, we account for SARs as liability-based awards that we re-measure to fair value at the end of each reporting period. We have no remaining unrecognized compensation cost at July 25, 2020, relating to SARs awards as they are all fully vested, but we will continue to remeasure these awards to reflect the fair value at the end of each reporting period until all awards are exercised or forfeited. As of July 25, 2020, we had 7,149 and 13,869 SARs outstanding for the fiscal 2013 and fiscal 2014 awards, respectively. These awards have exceeded their expected life and will be re-measured to fair value based on their intrinsic value, which is the market value of our common stock on the last day of the

reporting period less the exercise price, until the earlier of the exercise date or the contractual term date. At July 25, 2020, the intrinsic value per share of the fiscal 2013 and fiscal 2014 awards were $15.53 and $8.44, respectively.

Restricted Stock. We granted 119,535 shares of restricted stock to employees during the first quarter of fiscal 2021. We also have shares of restricted stock outstanding from previous grants. We issue restricted stock at no cost to the employees and the shares are held in an escrow account until the vesting period ends. If a recipient’s employment ends during the escrow period (other than through death or disability), the shares are returned at no cost to the Company. We account for restricted stock awards as equity-based awards because when they vest, they will be settled in common shares. The weighted-average fair value of the restricted stock awarded in the first quarter of fiscal 2021 was $27.54 per share, the market value of our common shares on the date of grant. We have elected to recognize forfeitures as an adjustment to compensation expense in the same period as the forfeitures occur. We recognize compensation expense for restricted stock over the vesting period equal to the fair value on the grant date of the award. Restricted stock awards vest at 25% per year, beginning one year from the grant date over a term of four years.

Performance Shares. During the first quarter of fiscal 2021, we granted 168,719 performance-based shares. We also have performance-based share awards outstanding from previous grants. Payout of the fiscal 2021 grant depends on our financial performance (50%) and a market-based condition based on the total return our shareholders receive on their investment in our stock relative to returns earned through investments in other public companies (50%). The performance share opportunity ranges from 50% of the employee’s target award if minimum performance requirements are met to a maximum of 200% of the target award based on the attainment of certain financial and shareholder-return goals over a specific performance period, which is generally three fiscal years. Grants of performance-based shares during fiscal 2019 and fiscal 2020 were weighted (80%) on financial performance and (20%) on market-based conditions consistent with those in the fiscal 2021 grant.

We account for performance-based shares as equity-based awards because when they vest, they will be settled in common shares. We have elected to recognize forfeitures as an adjustment to compensation expense in the same period as the forfeitures occur. For shares that vest based on our results relative to the performance goals, we expense as compensation cost the fair value of the shares as of the day we granted the awards recognized over the performance period, taking into account the probability that we will satisfy the performance goals. For performance-based shares granted in the first quarter of fiscal 2021, due to COVID-19 we have deferred setting our performance targets for such and as such, the grant date requirements under ASC 718 have not been met. Once performance goals are defined by the Compensation Committee, we will determine the awards' fair value. For shares that vest based on market conditions, we use a Monte Carlo valuation model to estimate each share’s fair value as of the date of grant. The Monte Carlo valuation model uses multiple simulations to evaluate our probability of achieving various stock price levels to determine our expected performance ranking relative to our peer group. For shares that vest based on market conditions, we expense compensation cost, net of estimated forfeitures, over the vesting period regardless of whether the market condition is ultimately satisfied. Based on the Monte Carlo model, the fair value as of the grant date of the fiscal 2021 grant of shares that vest based on market conditions was $38.14.

Accumulated Other Comprehensive Income (Loss)

3 Months Ended

Jul. 25, 2020

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Income (Loss)

The activity in accumulated other comprehensive income (loss) for the quarters ended July 25, 2020, and July 27, 2019, is as follows:



(Unaudited, amounts in thousands)	Translation adjustment			Change in fair value of cash flow hedge			Unrealized gain (loss) on marketable securities			Net pension amortization and net actuarial loss			Accumulated other comprehensive loss
Balance at April 25, 2020	$	(1,891	)	$	—		$	449		$	(5,510	)	$	(6,952	)
Changes before reclassifications	1,613			—			77			—			1,690
Amounts reclassified to net income	—			—			(22		)	87			65
Tax effect	—			—			(13		)	(22		)	(35		)
Other comprehensive income attributable to La-Z-Boy Incorporated	1,613			—			42			65			1,720
Balance at July 25, 2020	$	(278	)	$	—		$	491		$	(5,445	)	$	(5,232	)

Balance at April 27, 2019	$	50		$	87		$	6		$	(3,605	)	$	(3,462	)
Changes before reclassifications	128			—			143			—			271
Reclassification of certain income tax effects (1)	—			(97		)	258			(708		)	(547		)
Amounts reclassified to net income	—			5			—			55			60
Tax effect	—			(1		)	(35		)	(14		)	(50		)
Other comprehensive income (loss) attributable to La-Z-Boy Incorporated	128			(93		)	366			(667		)	(266		)
Balance at July 27, 2019	$	178		$	(6	)	$	372		$	(4,272	)	$	(3,728	)


(1)	Income tax effects of the Tax Cuts and Jobs Act are reclassified from AOCI to retained earnings due to adoption of ASU 2018-02.

We reclassified the unrealized gain/(loss) on marketable securities from accumulated other comprehensive loss to net income through other income (expense), net, reclassified the change in fair value of cash flow hedges to net income through cost of sales, and reclassified the net pension amortization to net income through other income (expense), net.

The components of non-controlling interest were as follows:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Balance as of the beginning of the period	$	15,553		$	14,468
Net income	(119		)	(81		)
Other comprehensive income	498			486
Dividends distributed to joint venture minority partners	(8,507		)	—
Balance as of the end of the period	$	7,425		$	14,873

Revenue Recognition

3 Months Ended

Jul. 25, 2020

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Our revenue is primarily derived from product sales. We report product sales net of discounts and recognize them when control (rights and obligations associated with the product) passes to the customer. For sales to furniture retailers or distributors, control typically transfers when we ship the product. In cases where we sell directly to the end consumer, control of the product is generally transferred upon delivery.

For shipping and handling activities, we have elected to apply the accounting policy election permitted in ASC 606-10-25-18B, which allows an entity to account for shipping and handling activities as fulfillment activities (rather than as a promised good or service) when the activities are performed even if those activities are performed after the control of the good has been transferred. We expense shipping and handling costs at the time we recognize revenue in accordance with this election.

For sales tax, we elected to apply the accounting policy election permitted in ASC 606-10-32-2A, which allows an entity to exclude from the measurement of the transaction price all taxes imposed on and concurrent with a specific revenue-producing transaction and collected by the entity from a customer, including sales, use, excise, value-added, and franchise taxes (collectively referred to as sales taxes). This allows us to present revenue net of these certain types of taxes.

We have elected the practical expedient permitted in ASC 606-10-32-18, which allows an entity to recognize the promised amount of consideration without adjusting for the effects of a significant financing component if the contract has a duration of one year or less. As our contracts typically are less than one year in length and do not have significant financing components, we have not adjusted consideration.

The following table presents our revenue disaggregated by product category and by segment or unit:



	Quarter Ended July 25, 2020
(Unaudited, amounts in thousands)	Wholesale		Retail		Corporate and Other			Total
Motion Upholstery Furniture	$	132,264	$	53,447	$	—		$	185,711
Stationary Upholstery Furniture	58,314		17,655		16,134			92,103
Bedroom Furniture	7,112		1,095		1,231			9,438
Dining Room Furniture	4,547		1,818		657			7,022
Occasional Furniture	8,110		3,410		729			12,249
Other (1)	13,226		13,712		(2,010		)	24,928
Total	$	223,573	$	91,137	$	16,741		$	331,451

Eliminations								(45,993		)
Consolidated Net Sales								$	285,458

	Quarter Ended July 27, 2019
(Unaudited, amounts in thousands)	Wholesale		Retail		Corporate and Other			Total
Motion Upholstery Furniture	$	179,522	$	85,184	$	—		$	264,706
Stationary Upholstery Furniture	91,653		29,153		22,952			143,758
Bedroom Furniture	8,193		1,447		1,182			10,822
Dining Room Furniture	5,405		2,599		394			8,398
Occasional Furniture	11,135		5,125		361			16,621
Other (1)	24,643		19,488		(4,337		)	39,794
Total	$	320,551	$	142,996	$	20,552		$	484,099

Eliminations								(70,466		)
Consolidated Net Sales								$	413,633


(1)	Primarily includes revenue for delivery, advertising, royalties, parts, accessories, after-treatment products, tariff surcharges, discounts and allowances, rebates and other sales incentives.

Motion Upholstery Furniture - Includes gross revenue for upholstered furniture, such as recliners, sofas, loveseats, chairs, sectionals and modulars that have a mechanism that allows the back of the product to recline or the product's footrest to extend. This gross revenue includes sales to La-Z-Boy Furniture Galleries^® stores (including company-owned stores), operators of La-Z-Boy Comfort Studio^® locations, England Custom Comfort Center locations, other major dealers, independent retailers, and the end consumer.

Stationary Upholstery Furniture - Includes gross revenue for upholstered furniture, such as sofas, loveseats, chairs, sectionals, modulars, and ottomans that do not have a mechanism. This gross revenue includes sales to La-Z-Boy Furniture Galleries^® stores (including company-owned stores), operators of La-Z-Boy Comfort Studio^® locations, England Custom Comfort Center locations, other major dealers, independent retailers, and the end consumer.

Bedroom Furniture - Includes gross revenue for casegoods furniture typically found in a bedroom, such as beds, chests, dressers, nightstands and benches. This gross revenue includes sales to La-Z-Boy Furniture Galleries^® stores (including company-owned stores), independent retailers, and the end consumer.

Dining Room Furniture - Includes gross revenue for casegoods furniture typically found in a dining room, such as dining tables, dining chairs, storage units and stools. This gross revenue includes sales to La-Z-Boy Furniture Galleries^® stores (including company-owned stores), independent retailers, and the end consumer.

Occasional Furniture - Includes gross revenue for casegoods furniture found throughout the home, such as cocktail tables, chairsides, sofa tables, end tables, and entertainment centers. This gross revenue includes sales to La-Z-Boy Furniture Galleries^® stores (including company-owned stores), independent retailers, and the end consumer.

At July 25, 2020, our consolidated balance sheet includes current assets of $39.7 million that we reported as other receivables. These other receivables represent the remaining consideration to which we are entitled prior to fulfilling our performance obligation. At the beginning of fiscal 2021, we had $17.1 million of other receivables.

We receive customer deposits from end consumers before we recognize revenue and in some cases we have the unconditional right to collect the remaining portion of the order price before we fulfill our performance obligation, resulting in deferred revenue (collectively, the “contract liabilities”). At July 25, 2020, we included $101.8 million of customer deposits and $39.7 million of deferred revenues in accrued expenses and other current liabilities on our consolidated balance sheet. At the beginning of fiscal 2021, we had $40.7 million of customer deposits and $17.1 million of deferred revenues. During the quarter ended July 25, 2020, we recognized revenue of $49.7 million related to our contract liability balance at April 25, 2020.

The increase in our contract assets and contract liabilities at July 25, 2020 was primarily the result of increased written sales during the first quarter of fiscal 2021 compared with those in the fourth quarter of fiscal 2020.

Segment Information

3 Months Ended

Jul. 25, 2020

Segment Reporting [Abstract]

Segment Information

Our reportable operating segments include the Wholesale segment and the Retail segment. Effective in the first quarter of fiscal 2021, in order to better align with the manner in which we view and manage the business, coupled with economic and customer channel similarities, we revised our reportable operating segments by aggregating the former Upholstery segment with the former Casegoods segment to form the newly combined Wholesale segment. The change in our reportable operating segments reflects how the Company evaluates financial information used to make operating decisions. There were no changes to our Retail operating segment or Corporate & Other as part of this revision. Prior period results disclosed in the tables below have been revised to reflect these changes.

Wholesale Segment. Our Wholesale segment consists primarily of three operating segments: La-Z-Boy, our largest operating segment, our England subsidiary, and our casegoods operating segment that sells furniture under three brands: American Drew^®, Hammary^® and Kincaid^®. The Wholesale segment also includes our international wholesale businesses. We aggregate these operating segments into one reportable segment because they are economically similar and because they meet the other aggregation criteria for determining reportable segments. Our Wholesale segment manufactures and imports upholstered furniture such as recliners and motion furniture, sofas, loveseats, chairs, sectionals, modulars, ottomans and sleeper sofas and imports casegoods (wood) furniture such as bedroom sets, dining room sets, entertainment centers and occasional pieces. The Wholesale segment sells directly to La-Z-Boy Furniture Galleries^® stores, operators of La-Z-Boy Comfort Studio^® locations, England Custom Comfort Center locations, major dealers, and a wide cross-section of other independent retailers.

Retail Segment. Our Retail segment consists of one operating segment comprised of our 155 company-owned La-Z-Boy Furniture Galleries^® stores. The Retail segment sells primarily upholstered furniture, in addition to some casegoods and other accessories, to end consumers through these stores.

Corporate & Other. Corporate & Other includes the shared costs for corporate functions, including human resources, information technology, finance and legal, in addition to revenue generated through royalty agreements with companies licensed to use the La-Z-Boy^® brand name on various products. We consider our corporate functions to be other business activities and have aggregated them with our other insignificant operating segments including our global trading company in Hong Kong and Joybird, an e-commerce retailer that manufactures upholstered furniture such as sofas, loveseats, chairs, ottomans, sleeper sofas and beds, and also imports casegoods (wood) furniture such as occasional tables and other accessories. Joybird sells to the end consumer primarily online through its website, www.joybird.com. None of the operating segments included in Corporate & Other meet the requirements of reportable segments.

The following table presents sales and operating income (loss) by segment:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Sales
Wholesale segment:
Sales to external customers	$	179,755		$	252,773
Intersegment sales	43,818			67,778
Wholesale segment sales	223,573			320,551

Retail segment sales	91,137			142,996

Corporate and Other:
Sales to external customers	14,566			17,864
Intersegment sales	2,175			2,688
Corporate and Other sales	16,741			20,552

Eliminations	(45,993		)	(70,466		)
Consolidated sales	$	285,458		$	413,633

Operating Income (Loss)
Wholesale segment	$	17,940		$	28,864
Retail segment	(6,627		)	8,477
Corporate and Other	(6,988		)	(13,919		)
Consolidated operating income	4,325			23,422
Interest expense	(459		)	(318		)
Interest income	494			727
Other income (expense), net	1,474			(760		)
Income before income taxes	$	5,834		$	23,071

Income Taxes	3 Months Ended
Income Taxes	Jul. 25, 2020
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes Our effective tax rate was 19.8% for the quarter ended July 25, 2020, compared with 22.0% for the quarter ended July 27, 2019. Absent discrete adjustments, primarily related to tax deductions from stock-based compensation, our effective tax rate in the first quarter of fiscal 2021 would have been 26.1%. Our effective tax rate varies from the 21% federal statutory rate primarily due to state taxes.

Earnings per Share

3 Months Ended

Jul. 25, 2020

Earnings Per Share [Abstract]

Earnings per Share

Certain share-based compensation awards that entitle their holders to receive non-forfeitable dividends prior to vesting are considered participating securities. Prior to fiscal 2019, we granted restricted stock awards that contained non-forfeitable rights to dividends on unvested shares, and we are required to include these participating securities in calculating our basic earnings per common share, using the two-class method.

The following is a reconciliation of the numerators and denominators we used in our computations of basic and diluted earnings per share:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Numerator (basic and diluted):
Net income attributable to La-Z-Boy Incorporated	$	4,798		$	18,069
Income allocated to participating securities	(4		)	(39		)
Net income available to common Shareholders	$	4,794		$	18,030

Denominator:
Basic weighted average common shares outstanding	45,909			46,820
Add:
Contingent common shares	47			130
Stock option dilution	9			175
Diluted weighted average common shares outstanding	45,965			47,125

Earnings per Share:
Basic	$	0.10		$	0.39
Diluted	$	0.10		$	0.38

The values for contingent common shares set forth above reflect the dilutive effect of common shares that we would have issued to employees under the terms of performance-based share awards if the relevant performance period for the award had been the reporting period.

We had outstanding options to purchase 1.5 million shares for the quarter ended July 25, 2020, with a weighted average exercise price of $29.08. We excluded the effect of these options from our diluted share calculation since the weighted average exercise price of the options was higher than the average market price and including the options’ effect would have been anti-dilutive. Similarly, we excluded options to purchase 0.4 million shares from the diluted share calculation for the quarter ended July 27, 2019.

Fair Value Measurements

3 Months Ended

Jul. 25, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements

Accounting standards require that we put financial assets and liabilities into one of three categories based on the inputs we use to value them:


•	Level 1 — Financial assets and liabilities, the values of which are based on unadjusted quoted market prices for identical assets and liabilities in an active market that we have the ability to access.


•	Level 2 — Financial assets and liabilities, the values of which are based on quoted prices in markets that are not active or on model inputs that are observable for substantially the full term of the asset or liability.


•	Level 3 — Financial assets and liabilities, the values of which are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement.

Accounting standards require that in making fair value measurements, we use observable market data when available. When inputs used to measure fair value fall within different levels of the hierarchy, we categorize the fair value measurement as being in the lowest level that is significant to the measurement. We recognize transfers between levels of the fair value hierarchy at the end of the reporting period in which they occur.

In addition to assets and liabilities that we record at fair value on a recurring basis, we are required to record assets and liabilities at fair value on a non-recurring basis. We measure non-financial assets such as other intangible assets, goodwill, and other long-lived assets at fair value when there is an indicator of impairment, and we record them at fair value only when we recognize an impairment loss.

The following table presents the fair value hierarchy for those assets we measured at fair value on a recurring basis at July 25, 2020 and April 25, 2020. There were no transfers into or out of Level 1, Level 2, or Level 3 for any of the periods presented.



At July 25, 2020
	Fair Value Measurements
(Unaudited, amounts in thousands)	Level 1		Level 2		Level 3		NAV(1)		Total
Assets
Marketable securities	$	—	$	20,608	$	—	$	7,195	$	27,803
Held-to-maturity investments	2,476		—		—		—		2,476
Cost basis investments	—		—		7,579		—		7,579
Total assets	$	2,476	$	20,608	$	7,579	$	7,195	$	37,858



At April 25, 2020
	Fair Value Measurements
(Unaudited, amounts in thousands)	Level 1		Level 2		Level 3		NAV(1)		Total
Assets
Marketable securities	$	—	$	31,691	$	—	$	6,515	$	38,206
Held-to-maturity investments	3,337		—		—		—		3,337
Cost basis investment	—		—		6,479		—		6,479
Total assets	$	3,337	$	31,691	$	6,479	$	6,515	$	48,022


(1)	Certain marketable securities investments are measured at fair value using net asset value per share under the practical expedient methodology.

At July 25, 2020 and April 25, 2020, we held marketable securities intended to enhance returns on our cash and to fund future obligations of our non-qualified defined benefit retirement plan, as well as marketable securities to fund future obligations of our executive deferred compensation plan and our performance compensation retirement plan. We also held other fixed income and cost basis investments.

The fair value measurements for our Level 1 and Level 2 securities are based on quoted prices in active markets, as well as through broker quotes and independent valuation providers, multiplied by the number of shares owned exclusive of any transaction costs.

At July 25, 2020, our Level 3 assets included non-marketable preferred shares and warrants to purchase common shares of two privately held start-up companies. The fair value for our Level 3 investments is not readily determinable so we estimate the fair value as costs minus impairment, if any, plus or minus adjustments resulting from observable price changes in orderly transactions for identical or similar investments with the same issuer. During the quarter ended July 25, 2020, we invested an additional $1.1 million in one of these privately held start-up companies. There were no other changes to the fair value of our Level 3 assets during the quarter ended July 25, 2020.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Basis of Presentation Basis of Presentation (Policies)

3 Months Ended

Jul. 25, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Recent accounting pronouncements

Accounting pronouncement adopted in fiscal 2021



ASU		Description
ASU 2016-13		Financial Instruments – Credit losses (Topic 326): Measurement of Credit Losses on Financial Instruments
ASU 2020-04		Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting

Accounting pronouncements not yet adopted



ASU	Description	Adoption Date
ASU 2018-14	Compensation – Retirement benefits – Defined Benefit Plans – General (Subtopic 715-20): Changes to the Disclosure Requirements for Defined Benefit Plans	Fiscal 2022
ASU 2019-12	Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes	Fiscal 2022
ASU 2020-01	Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815): Clarifying the Interactions between Topic 321, Topic 323, and Topic 815	Fiscal 2022

Basis of Presentation (Tables)

3 Months Ended

Jul. 25, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of New Accounting Pronouncements Adopted and Not Yet Adopted



ASU		Description
ASU 2016-13		Financial Instruments – Credit losses (Topic 326): Measurement of Credit Losses on Financial Instruments
ASU 2020-04		Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting

Accounting pronouncements not yet adopted



ASU	Description	Adoption Date
ASU 2018-14	Compensation – Retirement benefits – Defined Benefit Plans – General (Subtopic 715-20): Changes to the Disclosure Requirements for Defined Benefit Plans	Fiscal 2022
ASU 2019-12	Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes	Fiscal 2022
ASU 2020-01	Investments - Equity Securities (Topic 321), Investments - Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815): Clarifying the Interactions between Topic 321, Topic 323, and Topic 815	Fiscal 2022

Restricted Cash (Tables)

3 Months Ended

Jul. 25, 2020

Cash and Cash Equivalents [Abstract]

Schedule of cash, cash equivalents and restricted cash



(Unaudited, amounts in thousands)	7/25/20		7/27/19
Cash and cash equivalents	$	334,204	$	111,622
Restricted cash	2,476		1,970
Total cash, cash equivalents and restricted cash	$	336,680	$	113,592

Inventories (Tables)

3 Months Ended

Jul. 25, 2020

Inventory Disclosure [Abstract]

Summary of inventories

A summary of inventories is as follows:



(Unaudited, amounts in thousands)	7/25/20			4/25/20
Raw materials	$	90,414		$	92,174
Work in process	14,897			14,064
Finished goods	96,535			96,850
FIFO inventories	201,846			203,088
Excess of FIFO over LIFO	(21,445		)	(21,445		)
Total inventories	$	180,401		$	181,643

Goodwill and Other Intangible Assets (Tables)

3 Months Ended

Jul. 25, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of goodwill

The following is a summary of activity of goodwill for the quarter ended July 25, 2020:



(Unaudited, amounts in thousands)	Wholesale Segment		Retail Segment		Corporate and Other		Total Goodwill
Balance at April 25, 2020	$	11,630	$	93,941	$	55,446	$	161,017
Translation adjustment	408		172		—		580
Balance at July 25, 2020	$	12,038	$	94,113	$	55,446	$	161,597

Schedule of other intangible assets - indefinite-lived

We have intangible assets on our consolidated balance sheet as follows:



Reportable Segment/Unit	Intangible Asset	Useful Life
Wholesale Segment	Primarily acquired customer relationships from our acquisition of the wholesale business in the United Kingdom and Ireland	Amortizable over useful lives that do not exceed 15 years
Wholesale Segment	American Drew^® trade name	Indefinite-lived
Retail Segment	Reacquired rights to own and operate La-Z-Boy Furniture Galleries^® stores	Indefinite-lived
Corporate & Other	Joybird^® trade name	Amortizable over eight-year useful life

The following is a roll-forward of our other intangible assets for the quarter ended July 25, 2020:



(Unaudited, amounts in thousands)	Indefinite- Lived Trade Names		Finite- Lived Trade Name			Indefinite- Lived Reacquired Rights		Other Intangible Assets			Total Other Intangible Assets
Balance at April 25, 2020	$	1,155	$	5,003		$	19,996	$	2,499		$	28,653
Amortization	—		(199		)	—		(54		)	(253		)
Translation adjustment	—		—			128		86			214
Balance at July 25, 2020	$	1,155	$	4,804		$	20,124	$	2,531		$	28,614

Schedule of other intangible assets - finite-lived

We have intangible assets on our consolidated balance sheet as follows:



Reportable Segment/Unit	Intangible Asset	Useful Life
Wholesale Segment	Primarily acquired customer relationships from our acquisition of the wholesale business in the United Kingdom and Ireland	Amortizable over useful lives that do not exceed 15 years
Wholesale Segment	American Drew^® trade name	Indefinite-lived
Retail Segment	Reacquired rights to own and operate La-Z-Boy Furniture Galleries^® stores	Indefinite-lived
Corporate & Other	Joybird^® trade name	Amortizable over eight-year useful life

The following is a roll-forward of our other intangible assets for the quarter ended July 25, 2020:



(Unaudited, amounts in thousands)	Indefinite- Lived Trade Names		Finite- Lived Trade Name			Indefinite- Lived Reacquired Rights		Other Intangible Assets			Total Other Intangible Assets
Balance at April 25, 2020	$	1,155	$	5,003		$	19,996	$	2,499		$	28,653
Amortization	—		(199		)	—		(54		)	(253		)
Translation adjustment	—		—			128		86			214
Balance at July 25, 2020	$	1,155	$	4,804		$	20,124	$	2,531		$	28,614

Investments (Tables)

3 Months Ended

Jul. 25, 2020

Investments, Debt and Equity Securities [Abstract]

Summary of investments

The following summarizes our investments:



(Unaudited, amounts in thousands)	7/25/20		4/25/20
Short-term investments:
Marketable securities	$	9,340	$	18,634
Held-to-maturity investments	2,476		3,337
Total short-term investments	11,816		21,971
Long-term investments:
Marketable securities	18,463		19,572
Cost basis investments	7,579		6,479
Total long-term investments	26,042		26,051
Total investments	$	37,858	$	48,022

Investments to enhance returns on cash	$	16,494	$	28,622
Investments to fund compensation/retirement plans	13,785		12,921
Other investments	7,579		6,479
Total investments	$	37,858	$	48,022

Summary of unrealized gains, unrealized losses, and fair value by investment type

The following is a summary of the unrealized gains, unrealized losses, and fair value by investment type:



	7/25/20							4/25/20
(Unaudited, amounts in thousands)	Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Equity securities	$	1,575	$	(19	)	$	14,463	$	1,011	$	(6,390	)	$	12,692
Fixed income	274		(7		)	19,058		268		(56		)	30,213
Other	399		—			4,337		372		—			5,117
Total securities	$	2,248	$	(26	)	$	37,858	$	1,651	$	(6,446	)	$	48,022

Summary of sales of marketable securities

The following table summarizes sales of marketable securities:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Proceeds from sales	$	13,725		$	4,060
Gross realized gains	126			6
Gross realized losses	(18		)	(2		)

Summary of fair value of fixed icome marketable securities

The following is a summary of the fair value of fixed income marketable securities, classified as available-for-sale securities, by contractual maturity:



(Unaudited, amounts in thousands)	7/25/20
Within one year	$	9,366
Within two to five years	6,583
Within six to ten years	1,266
Thereafter	1,843
Total	$	19,058

Accrued Expenses and Other Current Liabilities (Tables)

3 Months Ended

Jul. 25, 2020

Payables and Accruals [Abstract]

Schedule of Accrued Expenses and Other Current Liabilities



(Unaudited, amounts in thousands)	7/25/20		4/25/20
Payroll and other compensation	$	39,562	$	34,980
Accrued product warranty, current portion	14,237		14,264
Customer deposits	101,771		40,721
Deferred revenue	39,747		17,086
Other current liabilities	52,913		48,231
Accrued expenses and other current liabilities	$	248,230	$	155,282

Product Warranties (Tables)

3 Months Ended

Jul. 25, 2020

Product Warranties Disclosures [Abstract]

Reconciliation of changes in product warranty liability

A reconciliation of the changes in our product warranty liability is as follows:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Balance as of the beginning of the period	$	23,255		$	22,736
Accruals during the period	3,828			5,657
Settlements during the period	(3,960		)	(5,557		)
Balance as of the end of the period (1)	$	23,123		$	22,836

(1)

$14.2 million and $14.3 million recorded in accrued expenses and other current liabilities as of July 25, 2020 and April 25, 2020, respectively, while the remainder is in included in other long-term liabilities.

Stock-Based Compensation (Tables)

3 Months Ended

Jul. 25, 2020

Share-based Payment Arrangement [Abstract]

Summary of total stock-based compensation expense

The table below summarizes the total stock-based compensation expense we recognized for all outstanding grants in our consolidated statement of income:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20		7/27/19
Equity-based awards expense	$	2,047	$	1,675
Liability-based awards expense	584		(60		)
Total stock-based compensation expense	$	2,631	$	1,615

Fair value assumptions for stock options

The fair value of stock options granted during the first quarter of fiscal 2021 were calculated using the following assumptions:



(Unaudited)	Fiscal 2021 grant			Assumption
Risk-free interest rate	0.34		%	U.S. Treasury issues with term equal to expected life at grant date
Dividend rate	0		%	Estimated future dividend rate and common share price at grant date
Expected life in years	5			Contractual term of stock option and expected employee exercise trends
Stock price volatility	41.79		%	Historical volatility of our common shares
Fair value per share	$	10.06

Accumulated Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Jul. 25, 2020

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedul of activity in accumulated other comprehensive loss

The activity in accumulated other comprehensive income (loss) for the quarters ended July 25, 2020, and July 27, 2019, is as follows:



(Unaudited, amounts in thousands)	Translation adjustment			Change in fair value of cash flow hedge			Unrealized gain (loss) on marketable securities			Net pension amortization and net actuarial loss			Accumulated other comprehensive loss
Balance at April 25, 2020	$	(1,891	)	$	—		$	449		$	(5,510	)	$	(6,952	)
Changes before reclassifications	1,613			—			77			—			1,690
Amounts reclassified to net income	—			—			(22		)	87			65
Tax effect	—			—			(13		)	(22		)	(35		)
Other comprehensive income attributable to La-Z-Boy Incorporated	1,613			—			42			65			1,720
Balance at July 25, 2020	$	(278	)	$	—		$	491		$	(5,445	)	$	(5,232	)

Balance at April 27, 2019	$	50		$	87		$	6		$	(3,605	)	$	(3,462	)
Changes before reclassifications	128			—			143			—			271
Reclassification of certain income tax effects (1)	—			(97		)	258			(708		)	(547		)
Amounts reclassified to net income	—			5			—			55			60
Tax effect	—			(1		)	(35		)	(14		)	(50		)
Other comprehensive income (loss) attributable to La-Z-Boy Incorporated	128			(93		)	366			(667		)	(266		)
Balance at July 27, 2019	$	178		$	(6	)	$	372		$	(4,272	)	$	(3,728	)

(1)

Income tax effects of the Tax Cuts and Jobs Act are reclassified from AOCI to retained earnings due to adoption of ASU 2018-02.

Schedule of components of non-controlling interest

The components of non-controlling interest were as follows:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Balance as of the beginning of the period	$	15,553		$	14,468
Net income	(119		)	(81		)
Other comprehensive income	498			486
Dividends distributed to joint venture minority partners	(8,507		)	—
Balance as of the end of the period	$	7,425		$	14,873

Revenue Recognition (Tables)

3 Months Ended

Jul. 25, 2020

Revenue from Contract with Customer [Abstract]

Schedule of disaggregation of revenue by product category by segment or unit

The following table presents our revenue disaggregated by product category and by segment or unit:



	Quarter Ended July 25, 2020
(Unaudited, amounts in thousands)	Wholesale		Retail		Corporate and Other			Total
Motion Upholstery Furniture	$	132,264	$	53,447	$	—		$	185,711
Stationary Upholstery Furniture	58,314		17,655		16,134			92,103
Bedroom Furniture	7,112		1,095		1,231			9,438
Dining Room Furniture	4,547		1,818		657			7,022
Occasional Furniture	8,110		3,410		729			12,249
Other (1)	13,226		13,712		(2,010		)	24,928
Total	$	223,573	$	91,137	$	16,741		$	331,451

Eliminations								(45,993		)
Consolidated Net Sales								$	285,458

	Quarter Ended July 27, 2019
(Unaudited, amounts in thousands)	Wholesale		Retail		Corporate and Other			Total
Motion Upholstery Furniture	$	179,522	$	85,184	$	—		$	264,706
Stationary Upholstery Furniture	91,653		29,153		22,952			143,758
Bedroom Furniture	8,193		1,447		1,182			10,822
Dining Room Furniture	5,405		2,599		394			8,398
Occasional Furniture	11,135		5,125		361			16,621
Other (1)	24,643		19,488		(4,337		)	39,794
Total	$	320,551	$	142,996	$	20,552		$	484,099

Eliminations								(70,466		)
Consolidated Net Sales								$	413,633


(1)	Primarily includes revenue for delivery, advertising, royalties, parts, accessories, after-treatment products, tariff surcharges, discounts and allowances, rebates and other sales incentives.

Segment Information (Tables)

3 Months Ended

Jul. 25, 2020

Segment Reporting [Abstract]

Sales and operating income (loss) by segment

The following table presents sales and operating income (loss) by segment:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Sales
Wholesale segment:
Sales to external customers	$	179,755		$	252,773
Intersegment sales	43,818			67,778
Wholesale segment sales	223,573			320,551

Retail segment sales	91,137			142,996

Corporate and Other:
Sales to external customers	14,566			17,864
Intersegment sales	2,175			2,688
Corporate and Other sales	16,741			20,552

Eliminations	(45,993		)	(70,466		)
Consolidated sales	$	285,458		$	413,633

Operating Income (Loss)
Wholesale segment	$	17,940		$	28,864
Retail segment	(6,627		)	8,477
Corporate and Other	(6,988		)	(13,919		)
Consolidated operating income	4,325			23,422
Interest expense	(459		)	(318		)
Interest income	494			727
Other income (expense), net	1,474			(760		)
Income before income taxes	$	5,834		$	23,071

Earnings per Share (Tables)

3 Months Ended

Jul. 25, 2020

Earnings Per Share [Abstract]

Schedule of reconciliation of numerators and denominators used in the computation of basic and diluted earnings per share

The following is a reconciliation of the numerators and denominators we used in our computations of basic and diluted earnings per share:



	Quarter Ended
(Unaudited, amounts in thousands)	7/25/20			7/27/19
Numerator (basic and diluted):
Net income attributable to La-Z-Boy Incorporated	$	4,798		$	18,069
Income allocated to participating securities	(4		)	(39		)
Net income available to common Shareholders	$	4,794		$	18,030

Denominator:
Basic weighted average common shares outstanding	45,909			46,820
Add:
Contingent common shares	47			130
Stock option dilution	9			175
Diluted weighted average common shares outstanding	45,965			47,125

Earnings per Share:
Basic	$	0.10		$	0.39
Diluted	$	0.10		$	0.38

Fair Value Measurements (Tables)

3 Months Ended

Jul. 25, 2020

Fair Value Disclosures [Abstract]

Fair value hierarchy for assets and liabilities measured at fair value on a recurring basis



At July 25, 2020
	Fair Value Measurements
(Unaudited, amounts in thousands)	Level 1		Level 2		Level 3		NAV(1)		Total
Assets
Marketable securities	$	—	$	20,608	$	—	$	7,195	$	27,803
Held-to-maturity investments	2,476		—		—		—		2,476
Cost basis investments	—		—		7,579		—		7,579
Total assets	$	2,476	$	20,608	$	7,579	$	7,195	$	37,858



At April 25, 2020
	Fair Value Measurements
(Unaudited, amounts in thousands)	Level 1		Level 2		Level 3		NAV(1)		Total
Assets
Marketable securities	$	—	$	31,691	$	—	$	6,515	$	38,206
Held-to-maturity investments	3,337		—		—		—		3,337
Cost basis investment	—		—		6,479		—		6,479
Total assets	$	3,337	$	31,691	$	6,479	$	6,515	$	48,022

(1)

Certain marketable securities investments are measured at fair value using net asset value per share under the practical expedient methodology.

Basis of Presentation (Details) $ / shares in Units, $ in Millions			3 Months Ended
	Aug. 18, 2020	Jun. 04, 2020	Oct. 24, 2020 $ / shares	Jul. 25, 2020 USD ($) company $ / shares	Jul. 27, 2019 $ / shares	Aug. 01, 2020	Apr. 25, 2020 USD ($)
Variable Interest Entity [Line Items]
COVID-19 action and related cost, number of positions eliminated, percent		10.00%
COVID-19 action and related cost, costs incurred				$ 3.5
Dividends paid (in dollars per share) \| $ / shares				$ 0	$ 0.13
Subsequent Event
Variable Interest Entity [Line Items]
COVID-19 action and related cost, salary reduction reinstated, percent						50.00%
COVID-19 action and related cost, dividends paid, percent	50.00%
COVID-19 \| Subsequent Event \| Forecast
Variable Interest Entity [Line Items]
Dividends paid (in dollars per share) \| $ / shares			$ 0.07
Line of Credit
Variable Interest Entity [Line Items]
Repayments of long-term line of credit				$ 25.0
Long-term line of credit							$ 75.0
Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Preferred share investments with common share warrant, number of privately-held companies \| company				2

Restricted Cash (Details) - USD ($) $ in Thousands	Jul. 25, 2020	Apr. 25, 2020	Jul. 27, 2019	Apr. 27, 2019
Cash and Cash Equivalents [Abstract]
Cash and cash equivalents	$ 334,204	$ 261,553	$ 111,622
Restricted cash	2,476	1,975	1,970
Total cash, cash equivalents and restricted cash	$ 336,680	$ 263,528	$ 113,592	$ 131,787

Inventories (Details) - USD ($) $ in Thousands	Jul. 25, 2020	Apr. 25, 2020
Inventory Disclosure [Abstract]
Raw materials	$ 90,414	$ 92,174
Work in process	14,897	14,064
Finished goods	96,535	96,850
FIFO inventories	201,846	203,088
Excess of FIFO over LIFO	(21,445)	(21,445)
Total inventories	$ 180,401	$ 181,643

Goodwill and Other Intangible Assets - Goodwill (Details) $ in Thousands	3 Months Ended
	Jul. 25, 2020 USD ($)
Roll-forward of goodwill
Balance at beginning of period	$ 161,017
Translation adjustment	580
Balance at end of period	161,597
Wholesale segment
Roll-forward of goodwill
Balance at beginning of period	11,630
Translation adjustment	408
Balance at end of period	12,038
Retail Segment
Roll-forward of goodwill
Balance at beginning of period	93,941
Translation adjustment	172
Balance at end of period	94,113
Corporate and Other
Roll-forward of goodwill
Balance at beginning of period	55,446
Translation adjustment	0
Balance at end of period	$ 55,446

Goodwill and Other Intangible Assets - Other Intangible Assets (Details) $ in Thousands	3 Months Ended
	Jul. 25, 2020 USD ($)
Roll-forward of other intangible assets
Balance at beginning of period	$ 28,653
Amortization	(253)
Translation adjustment	214
Balance at end of period	28,614
Finite- Lived Trade Name
Roll-forward of other intangible assets
Balance at beginning of period	5,003
Amortization	(199)
Translation adjustment	0
Balance at end of period	4,804
Other Intangible Assets
Roll-forward of other intangible assets
Balance at beginning of period	2,499
Amortization	(54)
Translation adjustment	86
Balance at end of period	2,531
Finite- Lived Trade Name
Roll-forward of other intangible assets
Balance at beginning of period	1,155
Amortization	0
Translation adjustment	0
Balance at end of period	1,155
Indefinite- Lived Reacquired Rights
Roll-forward of other intangible assets
Balance at beginning of period	19,996
Amortization	0
Translation adjustment	128
Balance at end of period	$ 20,124
Wholesale segment \| Maximum
Other intangible assets
Useful life	15 years
Corporate and Other
Other intangible assets
Useful life	8 years

Investments - Additional Information (Details)	Jul. 25, 2020 company
Investments, Debt and Equity Securities [Abstract]
Preferred share investments, number of privately-held companies	2

Investments - Components (Details) - USD ($) $ in Thousands	Jul. 25, 2020	Apr. 25, 2020
Investments
Total investments	$ 37,858	$ 48,022
Investments to enhance returns on cash
Investments
Total investments	16,494	28,622
Investments to fund compensation/retirement plans
Investments
Total investments	13,785	12,921
Other investments
Investments
Total investments	7,579	6,479
Short-term investments
Investments
Marketable securities	9,340	18,634
Held-to-maturity investments	2,476	3,337
Total investments	11,816	21,971
Long-term investments
Investments
Marketable securities	18,463	19,572
Cost basis investments	7,579	6,479
Total investments	$ 26,042	$ 26,051

Investments - Unrealized Gains and Losses and Fair Value (Details) - USD ($) $ in Thousands	Jul. 25, 2020	Apr. 25, 2020
Summary of investments
Gross Unrealized Gains	$ 2,248	$ 1,651
Gross Unrealized Losses	(26)	(6,446)
Fair Value	37,858	48,022
Equity securities
Summary of investments
Gross Unrealized Gains	1,575	1,011
Gross Unrealized Losses	(19)	(6,390)
Fair Value	14,463	12,692
Fixed income
Summary of investments
Gross Unrealized Gains	274	268
Gross Unrealized Losses	(7)	(56)
Fair Value	19,058	30,213
Other
Summary of investments
Gross Unrealized Gains	399	372
Gross Unrealized Losses	0	0
Fair Value	$ 4,337	$ 5,117

Investments - Sales and Maturities (Details) - USD ($) $ in Thousands	3 Months Ended
	Jul. 25, 2020	Jul. 27, 2019
Sales of marketable securities
Proceeds from sales	$ 13,725	$ 4,060
Gross realized gains	126	6
Gross realized losses	(18)	$ (2)
Fair value of available-for-sale securities by contractual maturity
Within one year	9,366
Within two to five years	6,583
Within six to ten years	1,266
Thereafter	1,843
Total	$ 19,058

Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Jul. 25, 2020	Apr. 25, 2020
Payables and Accruals [Abstract]
Payroll and other compensation	$ 39,562	$ 34,980
Accrued product warranty, current portion	14,237	14,264
Customer deposits	101,771	40,721
Deferred revenue	39,747	17,086
Other current liabilities	52,913	48,231
Accrued expenses and other current liabilities	$ 248,230	$ 155,282

Product Warranties (Details) - USD ($) $ in Thousands	3 Months Ended
Product Warranties (Details) - USD ($) $ in Thousands	Jul. 25, 2020	Jul. 27, 2019	Apr. 25, 2020
Reconciliation of changes in product warranty liability
Balance as of the beginning of the period	$ 23,255	$ 22,736
Accruals during the period	3,828	5,657
Settlements during the period	(3,960)	(5,557)
Balance as of the end of the period	23,123	$ 22,836
Product warranty liability accrued	$ 14,200		$ 14,300
Minimum \| Wholesale segment
Product Warranties
Percentage of warranty liability relating to the segment	90.00%
Fabric and leather \| Wholesale segment
Product Warranties
Warranty term (in years)	1 year
Cushions and padding \| Minimum \| Wholesale segment
Product Warranties
Warranty term (in years)	1 year
Cushions and padding \| Maximum \| Wholesale segment
Product Warranties
Warranty term (in years)	10 years
Labor costs relating to parts \| Wholesale segment
Product Warranties
Warranty term (in years)	1 year

Stock-Based Compensation - Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Jul. 25, 2020	Jul. 27, 2019
Stock-based compensation expense recognized for outstanding grants
Equity-based awards expense	$ 2,047	$ 1,675
Liability-based awards expense	584	(60)
Total stock-based compensation expense	$ 2,631	$ 1,615

Stock-Based Compensation - Stock Options (Details) - Stock Options	3 Months Ended
	Jul. 25, 2020 $ / shares shares
Stock-Based Compensation
Shares granted (in shares) \| shares	315,584
Fair value assumptions
Risk-free interest rate	0.34%
Dividend rate	0.00%
Expected life in years	5 years
Stock price volatility	41.79%
Fair value per share (in dollars per share) \| $ / shares	$ 10.06
Minimum
Stock-Based Compensation
Vesting period	1 year
Period of recognition of expenses for retirement-eligible employees from the grant date	10 months
Maximum
Stock-Based Compensation
Vesting period	4 years

Stock-Based Compensation - SARs (Details) - Stock Appreciation Rights	3 Months Ended
	Jul. 25, 2020 $ / shares shares
Stock-Based Compensation
Term of award	10 years
Fiscal 2013 Grant
Stock-Based Compensation
Number of awards outstanding (in shares) \| shares	7,149
Fair value per share (in dollars per share) \| $ / shares	$ 15.53
Fiscal 2014 Grant
Stock-Based Compensation
Number of awards outstanding (in shares) \| shares	13,869
Fair value per share (in dollars per share) \| $ / shares	$ 8.44

Stock-Based Compensation - Restricted Stock and RSUs (Details) - Restricted Stock	3 Months Ended
	Jul. 25, 2020 $ / shares shares
Stock-Based Compensation
Number of shares or units granted (in shares) \| shares	119,535
Fair value per share (in dollars per share) \| $ / shares	$ 27.54
Percentage vesting each year from date of grant	25.00%
Period from grant date for first vesting	1 year
Vesting period	4 years

Stock-Based Compensation - Performance Shares (Details)	3 Months Ended
Stock-Based Compensation - Performance Shares (Details)	Jul. 25, 2020 $ / shares shares
Performance-Based Shares
Stock-Based Compensation
Number of shares or units granted (in shares) \| shares	168,719
Performance Awards
Stock-Based Compensation
Performance awards, performance period	3 years
Performance Awards \| Fiscal 2021 Grant
Stock-Based Compensation
Percentage of payout dependent on financial performance	50.00%
Percentage of payout dependent on total shareholder return	50.00%
Performance Awards \| Fiscal 2019 Grant
Stock-Based Compensation
Percentage of payout dependent on financial performance	80.00%
Percentage of payout dependent on total shareholder return	20.00%
Performance Awards \| Fiscal 2020 Grant
Stock-Based Compensation
Percentage of payout dependent on financial performance	80.00%
Percentage of payout dependent on total shareholder return	20.00%
Performance Awards \| Minimum
Stock-Based Compensation
Performance award opportunity as a percentage of target award	50.00%
Performance Awards \| Maximum
Stock-Based Compensation
Performance award opportunity as a percentage of target award	200.00%
Performance Based Shares, vesting based on market conditions \| Fiscal 2021 Grant
Stock-Based Compensation
Granted (in dollars per share) \| $ / shares	$ 38.14

Accumulated Other Comprehensive Income (Loss) (Details) - USD ($)
$ in Thousands

3 Months Ended

Jul. 25, 2020

Jul. 27, 2019

Activity in accumulated other comprehensive loss

$ 716,306

$ 696,976

^[1]

714,999

698,138

716,306

696,976

Net income

4,679

17,988

2,218

767

Activity in accumulated other comprehensive loss

714,999

698,138

Translation adjustment

(1,891)

1,613

128

Other comprehensive income (loss) attributable to La-Z-Boy Incorporated

1,613

128

(278)

178

(1,891)

Change in fair value of cash flow hedge

(278)

178

Activity in accumulated other comprehensive loss

(97)

Other comprehensive income (loss) attributable to La-Z-Boy Incorporated

(1)

(93)

(6)

Unrealized gain (loss) on marketable securities

(6)

Activity in accumulated other comprehensive loss

449

143

258

(22)

Other comprehensive income (loss) attributable to La-Z-Boy Incorporated

(13)

(35)

366

491

372

449

Net pension amortization and net actuarial loss

491

372

Activity in accumulated other comprehensive loss

(5,510)

(3,605)

(708)

Other comprehensive income (loss) attributable to La-Z-Boy Incorporated

(22)

(14)

(667)

(5,445)

(4,272)

(5,510)

(3,605)

Accumulated other comprehensive loss

(5,445)

(4,272)

Activity in accumulated other comprehensive loss

(6,952)

(3,462)

1,690

271

^[1]

(547)

Other comprehensive income (loss) attributable to La-Z-Boy Incorporated

(35)

(50)

1,720

(266)

(5,232)

(3,728)

(6,952)

(3,462)

1,720

281

Non-Controlling Interests

(5,232)

(3,728)

Activity in accumulated other comprehensive loss

15,553

14,468

7,425

14,873

15,553

14,468

Net income

(119)

(81)

Dividends distributed to joint venture minority partners

498

486

(8,507)