Increase in Tile Volume Sold
Despite a decrease in overall comparable store sales by 4%, there was an increase in the volume of tile sold, driven by the expansion of competitively priced products and the addition of the Arbor collection of luxury vinyl tile products.
Gross Margin Rate Improvement
The gross margin rate increased by 20 basis points compared to the first quarter of 2024, largely due to a decrease in inventory write-offs.
Successful Cost Management
SG&A expenses remained in line with the prior year, with decreases in depreciation, distribution center closure costs, and benefits costs offsetting increases in marketing, training, and IT expenses.
Sublease Income from Distribution Center
Following the end of the quarter, the company successfully subleased their New Jersey distribution space, expected to generate $2 million in subleasing income by the third quarter of 2026.
Strong Cash Flow and Balance Sheet
The company generated $10 million in operating cash flow and added $6.1 million to their cash balance, reaching $27.1 million at the end of the quarter.