LA-Z-BOY INC

Our sources of liquidity include cash and cash equivalents, short-term and long-term investments, cash from operations, and amounts available under our credit facility. We believe these sources remain adequate to meet our short-term and long-term liquidity requirements, finance our long-term growth plans, and fulfill other cash requirements for day-to-day operations and capital expenditures, including fiscal 2026 contractual obligations.

We had cash and cash equivalents of $306.1 million at January 24, 2026, compared with $328.4 million at April 26, 2025. In addition, we had investments to enhance our returns on cash of $2.8 million at January 24, 2026, compared with $2.6 million at April 26, 2025.

The following table illustrates the main components of our cash flows:

Operating Activities

During the first nine months of fiscal 2026, net cash provided by operating activities was $175.7 million, primarily attributable to net income, adjusted for non-cash items, favorable changes to working capital, and higher customer deposits. Net cash provided by operating activities in the first nine months of fiscal 2026 was $50.4 million higher than the same period a year ago primarily due to favorable changes in inventory and payables combined with higher customer deposits, all partially offset by lower net income, adjusted for non-cash items.

Investing Activities

During the first nine months of fiscal 2026, net cash used for investing activities was $137.7 million, an increase of $66.5 million compared with the same period a year ago, due to increased cash paid for acquisitions and higher capital expenditures, partially offset by higher proceeds from the sale of assets. Cash used for investing activities in fiscal 2026 included the following:

•Cash used for acquisitions was $86.4 million, primarily related to the acquisition of the Atlanta, Georgia, central/northeast Florida, and Knoxville, Tennessee retail business.

•Cash used for capital expenditures was $56.7 million, which were primarily related to La-Z-Boy Stores (new stores and remodels), manufacturing-related investments, and spending related to our distribution and home delivery transformation. We anticipate that spending on these items will continue throughout the remainder of fiscal 2026, with full year fiscal 2026 capital expenditures expected to be in the range of $80 to $90 million. We have no material contractual commitments outstanding for future capital expenditures.

•Proceeds from the sale of assets were $4.8 million, primarily related to the sale of the Casegoods headquarters building and related fixed assets.

Financing Activities

During the first nine months of fiscal 2026, net cash used for financing activities was $61.0 million, a decrease of $20.2 million compared with the same period a year ago, primarily due to lower share repurchases, partially offset by reduced proceeds from exercised stock options. Cash used for financing activities in the first nine months of fiscal 2026 included the following:

•Cash paid to our shareholders in quarterly dividends was $28.1 million. Our board of directors has sole authority to determine if and when we will declare future dividends and on what terms. We expect the board to continue declaring regular quarterly cash dividends for the foreseeable future, but it may discontinue doing so at any time at the board's discretion.

•Cash paid to repurchase 0.7 million shares of company stock was $27.1 million. Our board of directors has authorized the repurchase of Company stock and as of January 24, 2026, 3.0 million shares remained available for repurchase pursuant to this authorization.

•Cash paid for tax withholding on stock issued as part of our employee benefit plans, net of proceeds from exercised stock options, was $4.4 million.

On October 15, 2021, we entered into a credit agreement with Wells Fargo Bank, National Association, as administrative agent, the other agents and lenders named therein and the other parties thereto (as amended prior to July 1, 2025, the "Credit Agreement"). The Credit Agreement provides for an unsecured revolving credit facility in an aggregate principal amount of $200 million, which includes a $50 million letter of credit sub-limit (the "Credit Facility").

On July 1, 2025, we entered into an amendment to the Credit Agreement (the "Credit Agreement Amendment"). The Credit Agreement Amendment, among other things, (i) extended the maturity date of the Credit Facility from October 15, 2026 to July 1, 2030, (ii) increased the accordion basket for additional revolving commitments and/or incremental term loans from $100 million to $125 million, (iii) removed the secured overnight financing rate ("SOFR") credit spread adjustment, and (iv) decreased the consolidated fixed charge coverage ratio required to be satisfied under the Company’s financial covenant.

Borrowings under the Credit Facility may be used by the Company for general corporate purposes. The Credit Facility will mature on July 1, 2030, and provides us the ability to extend the maturity date for two additional one-year periods, subject to the satisfaction of customary conditions.

The Credit Facility contains certain restrictive loan covenants, including, among others, financial covenants requiring a maximum consolidated net lease adjusted leverage ratio and a minimum consolidated fixed charge coverage ratio, as well as customary covenants limiting our ability to incur indebtedness, grant liens, make acquisitions, merge or consolidate, and dispose of certain assets.

As of January 24, 2026, we have no borrowings outstanding under the Credit Facility and we were in compliance with our financial covenants under the Credit Facility. We believe our cash and cash equivalents, short-term investments, and cash from operations, in addition to our available Credit Facility, will provide adequate liquidity for our business operations over the next 12 months.

Exchange Rate Changes

Due to changes in exchange rates, our cash and cash equivalents increased by $0.7 million for the nine months ended January 24, 2026. These changes impacted our cash balances held in Canada, Thailand, and the United Kingdom.

Other

During the third quarter of fiscal 2026, there were no material changes to the information about our contractual obligations and commitments disclosed in our Annual Report on Form 10-K for the fiscal year ended April 26, 2025. We do not expect our continuing compliance with existing federal, state and local statutes dealing with protection of the environment to have a material effect on our capital expenditures, earnings, competitive position or liquidity.