(LZB)
(LZB)
Kathy Liebmann - Director of Investor Relations & Communications
Melinda Whittington - President and Chief Executive Officer
Robert Lucian - Chief Financial Officer
Bobby Griffin - Raymond James & Associates, Inc. - Analyst
Bradley B. Thomas - KeyBanc Capital Markets - Analyst
Operator
Good day, ladies and gentlemen, and welcome to the La-Z-Boy Fiscal 2021 Fourth Quarter and Full Year Conference Call. [Operator Instructions]
At this time, it is my pleasure to turn the floor over to your host, Kathy Liebmann. Ma'am, the floor is yours.
Kathy Liebmann - Director of Investor Relations & Communications
Thank you, Melinda. Good morning, and thank you for joining us to discuss our fiscal 2021 fourth quarter and full year results. With us this morning are Melinda Whittington, La-Z-Boy's President and Chief Executive Officer; and Bob Lucian, Chief Financial Officer. Melinda will open and close the call and Bob will speak to the financials midway through. We'll then open the call to questions. Slides will accompany this presentation and you may view them through our webcast link, which will be available for one year and the telephone replay of the call will be available for one week beginning this afternoon.
Before we begin the presentation, I would like to remind you that some statements made in today's call include forward-looking statements about La-Z-Boy's future performance and other matters. Although we believe these statements to be reasonable, our actual results could differ materially. The most significant risk factors that could affect our future results are described in our annual report on Form 10-K. We encourage you to review those risk factors as well as other key information detailed in our SEC filings. Also, our earnings release is available under the News and Events tab on the Investor Relations page of our website and it includes reconciliations of certain non-GAAP measures, which are also included as an appendix at the end of our conference call slide deck.
With that, I'll now turn over the call to Melinda Whittington, La-Z-Boy's President and CEO. Melinda?
Melinda Whittington - President and Chief Executive Officer
Thank you, Kathy, and good morning, everyone. Late yesterday afternoon we reported our fiscal '21 fourth quarter and full year results. What a difference a year makes. When we started the fiscal year, the world was still in the early stages of COVID-19 and things seemed pretty dire. We had just restarted our plants after a month-long shutdown, and most retailers were still closed or just beginning to reopen.
Then as the year progressed, we experienced unprecedented demand for our products. We strengthened our business by significantly expanding production capacity in response to this demand, enhanced our retail platform, acquired the Seattle-based La-Z-Boy Furniture Galleries and turned Joybird profitable, all while navigating a multitude of challenges, including multiple supply chain disruptions, raw material price increases and macroeconomic uncertainties. Through it all, our highest priority was and continues to be the health and safety of our employees and our consumers.
The global pandemic tested everyone in just about every way. And I am so proud of the La-Z-Boy team for it's unbelievable perseverance, dedication and resiliency; qualities that enabled us to deliver excellent results even in the midst of these historic challenges. And I want to take this opportunity to express my sincere gratitude to everyone of our employees and business partners, all of whom contributed to our success. I also want to again thank Kurt Darrow, our now retired President and CEO, for his unwavering leadership in the last year and throughout his long career.
Turning to our financial results. Full fiscal year consolidated sales grew to $1.7 billion and consolidated GAAP operating margin increased to 7.9%. Non-GAAP operating margin reached 9%, the highest margin level achieved in recent history. Over the year, we generated $310 million in cash from operations and returned $61 million to shareholders through share repurchases and dividends; truly outstanding results, particularly considering the challenges of the fiscal year.
Specifically in the fourth quarter, consumer demand across all business units continued to be robust, reflecting the ongoing allocation of consumers' discretionary dollars to the home, the strength of our brands in the marketplace where we are disproportionately winning and excellent execution from our retail and sales teams. For the quarter, record sales of $519 million led to all-time record profits, driven by increased production capacity, excellent performance by our company-owned La-Z-Boy Furniture Galleries and continued profit growth at Joybird.
Additionally, our cash generation enabled us to return $50 million to shareholders through dividends and share repurchases in the quarter. And fiscal '22 is off to a great start with continued strong written order rates and a record backlog setting us up well for a strong year of shipments ahead. Written sales momentum continued to be very strong in the fourth quarter. Across the La-Z-Boy Furniture Galleries network, written same-store sales doubled, increasing 100% in the quarter versus a year ago. And to provide some additional context, written same-store sales for the quarter increased 29% compared with our pre-COVID fiscal 2019 fourth quarter for a compound annual growth rate of about 14% over the two years.
As I turn to the discussion of our segments, my remarks will detail our non-GAAP numbers, which we believe better reflect underlying operating trends, and Bob will cover the non-GAAP adjustments. Starting with our Wholesale segment, which includes our upholstery and casegoods companies as well as our international business, delivered sales for the quarter grew 40% to $384 million compared with prior year quarter, which was impacted by COVID-related shutdowns. Sequentially, sales increased 9.5% from fiscal '21's third quarter as we continued to increase production capacity.
Non-GAAP operating margin for the Wholesale segment was a healthy 10.2%. Disciplined cost management on advertising helped offset higher raw material and freight costs as well as expenses to expand production capacity to service record backlog. Also, last year's fourth quarter benefited from a one-time $16 million rebate of previously paid tariffs, partially offset by higher bad debt expense.
We continued to expand capacity to service demand. However, continued strong written growth is still outpacing production increases, translating to an expansion of backlog and lead times for the La-Z-Boy-branded business. For perspective, today, our backlog is about 8 times higher than in pre-COVID and 16 times higher than at the end of last fiscal year. Our supply chain team has demonstrated great agility over the past year and has been relentless in taking actions to increase capacity, including adding manufacturing cells, second shift, overtime and weekend production at our U.S. plants; temporarily reactivating a portion of our Newton, Mississippi assembly plant; adding manufacturing cells in available for space at our cut-and-sew center in Mexico; opening a new manufacturing facility in Mexico in San Luis Rio, Colorado or SLRC where production started in December and continues to increase as new cells are added and new employees are trained; and recently opening an additional fabric-sewing site in Paras, Mexico with plans to increase capacity over time.
Our supply chain team has done excellent work establishing new capacity. And given continued strong product demand, we are increasing the number of cells at these new locations to shorten lead times, which today range between four to nine months for the La-Z-Boy-branded business, depending on the product category versus our normal four to six weeks.
Beyond capacity challenges, we continue to face raw material price increases due to supply and demand trends and supply chain disruptions. Input materials such as foam, steel and plywood are up 2 to 4 times their pre-pandemic prices. While we have taken several rounds of pricing in new written - on new written orders, as cost have continued to escalate, our significant backlog results in taking several quarters for pricing actions to flow through to delivered sales and our financials. And as we continue to monitor costs, and we'll take further actions when and if necessary, we've taken additional pricing just last week.
Our procurement team is also actively managing product availability challenges, including shipping container issues that have delayed deliveries of finished products to our international and casegood businesses and component part availability, such as electrical components for our higher margin power units. Despite continuing supply chain disruptions, the team has done a great job keeping us in stock for major raw material inputs, including wood, foam and steel.
While we actively focus on increasing production and managing supply chain challenges, our demand remains very strong. The La-Z-Boy brand continues to meet the test of time with enduring attributes of comfort and quality. Over the past year, all product categories have performed well with sectionals and modular sofas continuing to be very strong.
At the most recent High Point Furniture Market, we announced that La-Z-Boy has teamed up with Tempur Sealy to create a proprietary material unlike ordinary memory foam called TEMPUR-Response that is specifically designed for our seating and sleeper mattresses. With two iconic brands banding together, we have seen great interest from our customers. And on the marketing side, with Kristen Bell as our brand ambassador, we are seeing increased consideration for La-Z-Boy among younger consumers, underscoring her broad appeal to both our core and target consumer.
Now let me turn to the Retail segment, which produced excellent results. For the quarter, delivered sales increased 39% to a record $194 million and delivered same-store sales increased 35% versus year ago, on strong execution by the team. Non-GAAP operating margin increased to 12.2% from 10.8% in last year's comparable quarter, primarily driven by fixed cost leverage on higher delivered sales volume. Last year's fourth quarter was marked by a reduction in sales due to COVID-related store closures in the last four weeks of the quarter.
Written same-store sales for the company-owned La-Z-Boy Furniture Galleries stores more than doubled, increasing 114% in the quarter, reflecting positive trends across all sales metrics, including traffic, conversion and average ticket. For perspective, against the fiscal 2019 fourth quarter when we were in a pre-COVID environment, written same-store sales increased 40%. That's about an 18% compound average growth rate over the two years, which again demonstrates the strength of our business and brand in the marketplace and that consumers feel safe shopping in our stores.
Our primary focus is to service and delight consumers at all touch points, providing them with a great end-to-end experience every time. As part of this, we are committed to enhancing our omnichannel presence to offer an easy and comprehensive experience to meet consumers wherever they want to shop, whether online, in store or a combination of both. As we invest in technology enhancements to make the online experience more robust and engaging, we will continue to invest in the La-Z-Boy Furniture Galleries store system to provide consumers with modern, bright and inspiring stores.
For fiscal '22, approximately 30 projects, including new stores, remodels and relocations, will be completed across the network, with two-thirds of the projects within our company-owned portfolio. Also, in addition to the Seattle acquisition that closed last September, this week, we signed an agreement to acquire three stores in the vibrant Long Island, New York market.
I'll now spend a few minutes on Joybird, which turned in a great quarter. Delivered sales for the period, which are reported in Corporate and Other, more than doubled, increasing 144% to $38 million, reflecting strong end-to-end execution. Written sales increased 125% in the quarter versus the prior year period, reflecting ongoing strong order trends and the strength of the brand in the online marketplace.
Joybird again delivered profitable growth and improved its gross margin. Our Joybird team continues to do an excellent job in terms of marketing effectiveness. We've increased our marketing spend to drive consumer acquisition, bringing the right consumer to the site and providing an excellent online experience leading to improved conversion.
I'll now turn the call over to Bob to discuss the financials. Bob?
Robert Lucian - Chief Financial Officer
Thank you, Melinda, and good morning, everyone. As a reminder, we present our results on both GAAP and non-GAAP basis. We believe the non-GAAP presentation better results underlying operating trends and performance of the business. As detailed in our press release and in the tables in the Appendix section of our conference call slides, excluded from our fiscal '21 fourth quarter non-GAAP reporting, our purchase accounting charges for acquisitions totaling $2 million pre-tax plus related tax adjustments totaling $0.06 per diluted shares, primarily due to a write-up of the Joybird contingent consideration liability based on forecast performance.
For the full fiscal 2021 year, non-GAAP results exclude purchase accounting charges totaling $17 million pre-tax or $0.33 per diluted share, primarily due to a write-up for the Joybird contingent consideration liability based on forecast performance. Two, a change of $3.8 million pre-tax or $0.07 per diluted share related to the company's business realignment initiative announced in June of 2020. And finally, income of $5.2 million pre-tax or $0.08 per diluted share for employee retention payroll tax credits the company qualified for under the CARES Act. Fiscal year '20 also included non-GAAP adjustments, as we have talked previously, and again, are detailed in our press release and in the tables in the Appendix section of our conference call slides.
Now on to our results. My comments from here will focus on our non-GAAP reporting, unless specifically stated otherwise. On a consolidated basis, fiscal '21 fourth quarter sales increased 41% to a record $519 million, reflecting strong demand and a comparison to the fiscal '20 fourth quarter, which was impacted by COVID-related plant and retail closures. Consolidated non-GAAP operating income increased to $52 million. And consolidated non-GAAP operating margin improved to 10.0% versus 9.3%. Non-GAAP EPS was $0.87 per diluted share in the current year versus $0.49 in last year's fourth quarter. Strong operating margins in the quarter benefited from disproportionate growth in fixed cost leverage in the Retail segment and at Joybird as well as reduced marketing, advertising and administrative spend as a percentage of sales, which more than offset rising commodity costs in the quarter.
Moving on to full year results for fiscal 2021. Sales increased 1.8% to $1.7 billion, a strong result given the slow start to the fiscal year, with many retailers closed, including most of our company-owned La-Z-Boy Furniture Galleries and our plants just restarting production at limited capacity. For the year, non-consolidated - I'm sorry, excuse me. For the year, consolidated non-GAAP operating income increased to $157 million and consolidated non-GAAP operating margin reached 9%, an all-time high in recent history. Non-GAAP EPS increased to $2.62 per diluted share versus $2.16 in fiscal 2020.
Consolidated gross margin for the full fiscal '21 year increased 10 basis points versus the prior year. Changes in our consolidated sales mix, driven by the growth of Retail end Joybird, which carry a higher gross margin than our Wholesale businesses, drove the biggest change in margin. Additionally, Joybird experienced a significant improvement in gross margin, primarily resulting from product pricing actions, an increase in average ticket, favorable product mix and synergies as Joybird was integrated into our broader supply chain. Partially offsetting these gross margin increases were higher costs related to expanding our manufacturing capacity across the company, a shift in product mix related to those capacity increases and rising raw material costs. It's important to note that last year's gross margin was positively impacted by rebates on previously paid tariffs, which provided 100 basis point benefit to gross margin.
SG&A as a percentage of sales decreased 70 basis points for fiscal '21 versus fiscal '20, primarily reflecting cost reduction initiatives taken throughout the year, including lower marketing and advertising spend given strong demand trends. Fiscal year '20 results included bad debt expense due to the Art Van bankruptcy in fiscal '20 as well as a provision for credit losses last year due to the uncertain economic environment caused by COVID. Partially offsetting these decreases were increased incentive compensation costs related to the company's performance and changes to our consolidated sales mix due to the growth of our Retail segment and Joybird, which both carry higher SG&A costs than our Wholesale businesses.
Our effective tax rate on a GAAP basis for fiscal '21 was 26.3% versus 31.4% in fiscal '20. Impacting our effective tax rate for fiscal '20 was a net tax expense of $4 million, primarily from the tax effect of a non-deductible goodwill impairment charge related to Joybird and tax expense of $1.3 million from deferred tax attributable to undistributed foreign earnings no longer permanently reinvested. Absent discrete adjustments, the effective tax rate in fiscal '20 would have been 26.4%.
Turning to cash. For the year, we generated $310 million in cash from operating activities, reflecting strong operating performance and a $140 million increase in customer deposits from written orders for the company's Retail segment and Joybird. We ended the period with $395 million in cash and no debt, up from $264 million in cash at the end of fiscal '20 and $75 million drawn on our credit facility. In addition, we held $32 million in investments to enhance returns on cash compared with $29 million last year.
As we have managed the business through COVID-19, we've been conservative with cash, and in the process, have strengthened our resources to capitalize on future value-creating opportunities to grow out of the pandemic. During the year, we invested $38 million in capital, primarily related to machinery and equipment, improvements to select retail stores, cost for new production capacity in Mexico and upgrades to our Dayton, Tennessee manufacturing facility, which have now been completed.
Regarding cash return to shareholders, for the year, we paid $16.5 million in dividends to shareholders and spent approximately $44 million, purchasing 1.1 million shares of stock in the open market under our existing authorized share repurchase program. This leaves $3.4 million - 3.4 million shares of purchase availability in this program. Our capital allocation strategy remains to first invest in the business to deliver long-term results followed by returns to shareholders through a consistent dividend and share repurchases.
Before returning the call to Melinda, let me highlight several important items for fiscal 2022. We expect our non-GAAP adjustments for fiscal '22 will include purchase accounting adjustments for previous acquisitions estimated to be at $0.01 to $0.03 per diluted share. This excludes any further adjustments that may be made to the Joybird contingent consideration liability depending on updated estimates of Joybird's ongoing business trajectory.
Regarding seasonality, incoming order rates and a large backlog will mitigate the usual seasonal slowdown associated with the first quarter. However, as usual, the first quarter is limited to 12 weeks of production and shipments to enable our shutdown week in July for maintenance for most of the company's plants compared to the usual 13 weeks of production shipments in quarters two and four.
Regarding production capacity, demand trends remained strong across the business with backlog at record levels, providing for a long tail. We anticipate ongoing incremental increases in capacity through fiscal 2022 as new assembly cells are added and efficiencies improve, which will result in continued incremental progress on delivered sales. However, we expect temporary significant pressures on profit margins in the first half of fiscal '22 compared to the very strong profit margin of this Q4. We expect to face ongoing global supply chain disruptions and escalating raw material and freight costs, which will cause volatility in results and will eventually be offset by our already announced pricing actions in the back half of the year as we work through our backlog.
Further, we intend to continue investing in our business to ensure we play offense and strengthen the business and its brands for the long-term even as we weather these short-term challenges. The full impact of these factors may result in a temporary impact to profit, which could be in the range of 300 basis points in the first two quarters compared to our very strong Q4 levels, but still in line with or above our historical levels for the summer months.
Finally, as we make investments in the business to strengthen the company for the future, we expect capital expenditures to be in the range of $55 million to $65 million for fiscal 2022. Spending will support updating our La-Z-Boy Furniture Galleries stores, updating and expanding our plants and investments in technology solutions across the organization.
And now, let me turn the call back to Melinda.
Melinda Whittington - President and Chief Executive Officer
Thanks, Bob. The dynamics of the past year have been profoundly challenging, but also educational. These events affirm our prudent financial culture which served us well during this uncertain period, and our strong cash position provides opportunities for investment in our next chapter of growth.
For the immediate term, we are focused on continuing to increase capacity and deliver units, but acknowledge the next several quarters will be volatile given we are still operating in unprecedented times. That said, we are stepping back and evaluating our strengths and our opportunities and we are investing in the company to emerge stronger in a post-pandemic environment and even more able to deliver long-term profitable growth. Although this is not an easy time, it is truly an exciting one; marked by change, incredibly strong demand and the ability to play offense. I thank our board of directors and all stakeholders for their support this past year and look forward to a fantastic future of continued growth and shared prosperity.
I thank you for your interest in La-Z-Boy Incorporated. And now we'll turn the call over to Kathy to provide the instructions for getting into the queue for questions. Kathy?
Kathy Liebmann - Director of Investor Relations & Communications
Thank you, Melinda. We'll begin the question-and-answer period now. Melinda, please review the instructions for getting into the queue to ask questions.
Operator
Thank you. [Operator Instructions] And we go to our first signal, Bobby Griffin with Raymond James. Please go ahead.
Bobby Griffin - Raymond James & Associates, Inc. - Analyst
Good morning, everybody. I hope you're all doing well, and thank you for taking my questions.
Melinda Whittington - President and Chief Executive Officer
Good morning.
Robert Lucian - Chief Financial Officer
Hey, Bobby.
Bobby Griffin - Raymond James & Associates, Inc. - Analyst
So Bob, I just want to circle right back quickly to your comments about the 300 bps of margin pressure just to make sure we're all on the same page of what's that referencing in kind of what timeframe. So is that in reference to the 10% EBIT margin that was posted in 4Q? And are you saying that 1Q and 2Q of 2021 should be down about 300 bps at the highest level possible versus first at 10% if raw material headwinds were as strong as they could be?
Robert Lucian - Chief Financial Officer
That's correct.
Bobby Griffin - Raymond James & Associates, Inc. - Analyst
Okay. And then - so for both quarters kind of the same type of trajectory off the 10%. I mean, that would put 2Q though below where kind of it was in the October of '19 quarter which was 7.5%. Is that all just raw material related or mix of business or could we end up at 7% EBIT margins below than kind of where we were two years ago even?
Robert Lucian - Chief Financial Officer
It's mostly the raw material impacts that we're seeing. And again, we've taken pricing and it's taking a while for that pricing to work its way through. So it will work its way through by towards the end of Q2 into Q3 and that's when our margins will start improving.
Bobby Griffin - Raymond James & Associates, Inc. - Analyst
Okay. All right, that's helpful. And then trying to - usually 1Q is the seasonally weak quarter, but with this large of a backlog that you have, I think in the 10-K it was $617 million or something called out. I mean, is the right way to think about the potential revenue side of things here in 1Q basically 12, 13 of what you delivered in 4Q or is there something wrong with kind of using that as an estimate?
Robert Lucian - Chief Financial Officer
I don't think there's anything wrong using that as an estimate.
Bobby Griffin - Raymond James & Associates, Inc. - Analyst
Okay. And then I guess - go ahead, I'm sorry.
Robert Lucian - Chief Financial Officer
Yeah. We continued to sequentially increase our capacity. So I would expect that to be at least the case.
Bobby Griffin - Raymond James & Associates, Inc. - Analyst
All right. If it's permitted, my - actually my follow-up was there on capacity, just trying to understand kind of where we are better today. And I don't know what the right context maybe if we want to put it back in, are we at pre-COVID levels in terms of what the company can do in terms of units or we're still kind of a little bit below what the capacity, the business was pre-COVID levels just given the challenges of getting foam and some of the materials?
Robert Lucian - Chief Financial Officer
Yeah. We're higher than we were pre-COVID. And again, we've continued to - we will continue to increase that - just given the backlog that you referenced, we'll continue to increase that and try to work that backlog down.
Bobby Griffin - Raymond James & Associates, Inc. - Analyst
Okay, very helpful. I'll jump back in the queue let somebody else ask some questions. But I appreciate the details here.
Robert Lucian - Chief Financial Officer
Thanks, Bobby.
Operator
Next we go to the line of Brad Thomas with KeyBanc Capital Markets. Please go ahead.
Bradley B. Thomas - KeyBanc Capital Markets - Analyst
Hi, good morning. Good quarter. Thanks for all the details.
Melinda Whittington - President and Chief Executive Officer
Good morning.
Bradley B. Thomas - KeyBanc Capital Markets - Analyst
Hi, Melinda. Maybe first just a big picture question and then some housekeeping items to follow-up on some of Bobby's questions. But just from a big picture standpoint, Melinda, as you all invest in capacity and try to catch up from this very strong demand, can you talk a little bit about maybe what changes you're making in terms of how you run your supply chain and how you build product to try to position yourself not just to catch up to the strong demand you're seeing right now, but best position the company for growth, how you're considering some of that?
Melinda Whittington - President and Chief Executive Officer
Yeah. I would - I guess, I would take that in kind of two buckets. The first one is, truly, we were running a very efficient operation, but an operation that could flex in that single-digit percentages kind of for volume that we've seen historically. So really a lot of it is about enough floor space and enough people well trained to continue to be able to flex that volume. And as I called out in my prepared remarks, a lot of that has looked like available labor force and space in some of these Mexico locations as well as a lot more shifts, overtime and all in our U.S. plants. But to your point, we do continue to look at where do you optimize even simple things like this is a short-term item, but we're training new people on more simple furniture, right, and chairs and so forth. And then as they get more up to speed and more capable, then we're bringing the more complex pieces to them.
I think the biggest structural item that I would just call out though is, and we've talked about it before, but our San Luis Rio, Colorado location is a space that we've strategically had our eye on for a while to better service the West Coast over time and kind of the western half of North America. And so that's a location that we brought up more quickly than maybe we had initially planned because of COVID and the demand that we're seeing. But putting that location there is a long-term strategic footprint to better service. And there are a variety of other either longer term activities that we're looking at or smaller, but that's probably the biggest one that I'd say is kind of a fundamental shift that was on our strategic roadmap, but we moved to that more quickly because of the current demand.
Bradley B. Thomas - KeyBanc Capital Markets - Analyst
That's very helpful. And understanding that the - just some price increases, the sales volume level that you all can generate should have gone higher. But is there a good way to think about what dollar value capacity number you are shooting for will be at a few quarters from now or at the end of the year?
Melinda Whittington - President and Chief Executive Officer
Yeah. It's a bit of a variable model, honestly. I mean, one, we continue to add cells as we continue to see demand being strong. And so what we are shooting for is somewhat driven by what we continue to see in the demand trends. But we're still growing, and really throughout the rest - throughout all of fiscal '22, I think we'll continue to see incremental progress each quarter in capacity and that is both through the cells that we're opening, but also just as our folks get up to speed and get more efficient.
And then I would say that number can be somewhat fungible over time, particularly if we were to start to see - if we start to see things continued to increase or if we were start to see some of that demand slow down a bit. Given the amount of overtime we're working, second shifts, weekends and so forth, we can always pull that back depending on where we see trends continuing. So it's hard to put a number on it just because - I mean, there are both different inputs into what we're heading - what we may need as well as we've got a lot of flexibility and how to back some of that offer, build it up for any short-term changes.
Bradley B. Thomas - KeyBanc Capital Markets - Analyst
Great. And if I could just squeeze one more in terms of thinking about cash, you guys obviously have a big sizable cash balance today and with the strength in the business should generate a healthy amount of cash here this year. For one, I apologize if I missed it, Bob, but did you disclose your capex plans for the year? How are you thinking about working capital needs for the year as you grow inventory? And what do you think about doing with all this excess cash? Thanks.
Robert Lucian - Chief Financial Officer
It's a great problem to have. Right now, what I mentioned in the call was $55 million to $65 million of capital spending again focused on the company on improving our retail stores, converting a number of our retail stores, investing in more capacity, investing in technology and technology solutions throughout the company. So that's where those dollars will be going. We'll also be upgrading one of our plants, our largest plant in the U.S. which is Neosho, which we'll use a lot of those dollars as well. And we will do all we can to go deliver what we can from a capacity standpoint. So if there is more investment needed, we'll go off and we'll do that.
We are also - and as you can see it in our working capital, we are not being shy on inventories. We're trying to increase our level of inventories relative to trying to minimize the disruptions that we're seeing. So if there is disruptions in foam, wood or steel, we're trying to carry the higher levels of inventory, so we're able to withstand those disruptions that occur. So it doesn't impact our capacity. If we lose a shift of capacity because we're running max out, we can't get that back out, so those are lost sales. So that's why we're investing more in inventory from a working capital perspective.
And then the other piece what we're doing is again we'll continue to with our consistent level of dividends that we try to do. And we will continue to invest in share repurchases over and above just what's needed for the purpose of preventing dilution. And you can see that from Q4, we invested over $40 million in share repurchases in the quarter trying to get the full fiscal year up to where we've averaged for the last three to four years.
Melinda Whittington - President and Chief Executive Officer
And I would just add that we are stepping back to look at. It's a great - as Bob said, it's a great problem to have. And so we are stepping back to look at where we should be investing in our company to ensure that even post-pandemic we really can be on a strong growth trajectory with strong profitability. So it's a good spot to be able to step back and really think about where do we need to invest and make ourselves even better for the future.
Bradley B. Thomas - KeyBanc Capital Markets - Analyst
Wonderful. Thank you so much.
Operator
[Operator Instructions] And that does appear to be all of the signals that we have. We will return to Kathy Liebmann for closing remarks.
Kathy Liebmann - Director of Investor Relations & Communications
Thank you everyone for joining us this morning. If you have any follow-up questions, please give me a call, I will be available. Thank you, and have a great day. Bye, bye.
Operator