When Lumber Liquidators executives talked about earnings in a conference call last week, they alluded to an upcoming "60 Minutes" investigation of the company's business practices. Turns out, the CBS report was a lot more damning than some analysts expected.
After a delay of several days, Lumber Liquidators has reported second-quarter results, nearly three weeks after the company revised its full-year guidance, which caused its stock to plummet in recent days.
Lumber Liquidators doesn’t report its second-quarter results until July 31. But reduced customer traffic along with weak macroeconomic trends related to residential remodeling and a drop in home sales have prompted the company to revisit its outlook for the quarter and full year.
Lumber Liquidators has formalized its compliance and sustainability team headed by Raymond Cotton, who was appointed as chief compliance and sustainability officer in February and reports directly to president and CEO Robert M. Lynch.
Lumber Liquidators spokesman Clint Roberts responded to sister publication HCN's requests for comment regarding the ongoing federal investigation into its sourcing practices. Multiple reports have suggested that the investigation is linked to the Environmental Investigation Agency, which claims the retailer is purchasing wood illegally in protected forests in Far East Russia.
Fast-growing flooring retailer Lumber Liquidators got an unpleasant surprise on Thursday when representatives from several federal agencies showed up at the company’s Toano, Va., headquarter with search warrants in hand.