Ethan Allen sales up 5%
By Larry Thomas -- Furniture Today, January 26, 2004
DANBURY, Conn. — Manufacturer and retailer Ethan Allen said sales increased 5% in its second quarter, including a 7.4% jump in sales from its retail division.
The company, which sells its products through a network of 311 stores, said comparable store sales rose 1.8% in the quarter ended Dec. 31.
"As the economy improves, we are seeing a greater willingness on the part of consumers to invest in their homes," said Farooq Kathwari, chairman and chief executive officer. "We remain optimistic the business growth we have experienced in recent months is indicative of further economic expansion in 2004."
Sales in the quarter came to $241.2 million, compared with $229.7 million in the same period a year earlier. Net income was $24.4 million, or 64 cents per share, compared with $23.1 million, or 60 cents per share, in the year-ago quarter, a 5.7% gain.
Sales for the six months rose 4% to $463.9 million. Net income was essentially even with the comparable period last year, totaling $43.3 million, or $1.13 per share.
In a conference call with securities analysts, Kathwari said products introduced in the past 18 months accounted for about 50% of sales in the quarter. He noted that a new collection of furniture for plasma televisions is retailing very well, as is a line of bathroom furniture and accessories unveiled last year.
He acknowledged the company trimmed its national advertising efforts in November and December, but will ramp up expenditures beginning in February. The 2004 program will feature television spots and direct-mail catalogs, said Kathwari.
He told analysts he is very pleased with the performance of the two Ethan Allen Kids stores opened in recent months. Deliveries have been slow because the line was oversold last year, but he said that problem has been solved and deliveries are more timely.
Kathwari said the balance sheet remains solid, thanks largely to strong operating cash flow, a figure that nearly doubled to $26.5 million in the most recent quarter.
At the end of the quarter, Ethan Allen had $148.5 million in cash and cash equivalents, up 81.4% from $81.9 million on June 30, 2003.
| Ethan Allen | |||
|---|---|---|---|
| Earnings per share are fully diluted, and all figures in parentheses are loses or declines. | |||
| Quarter ended 12/31 | 2003 | 2002 | Change |
| (a) Includes pretax restructuring and impairment credits of $264,000 in the 2003 six months and $92,000 in the 2002 six months. | |||
| Sales | $241,150,000 | $229,713,000 | 5.0% |
| Operating income | 39,112,000 | 37,195,000 | 5.2% |
| Net income | 24,398,000 | 23,086,000 | 5.7% |
| Earnings per share | 0.64 | 0.60 | 6.7% |
| 6 months ended 12/31 | 2003 | 2002 | Change |
| Sales | $463,915,000 | $446,242,000 | 4.0% |
| Operating income | 67,424,000 | 69,038,000 | (2.3%) |
| Net income (a) | 43,337,000 | 43,168,000 | 0.4% |
| Earnings per share | 1.13 | 1.11 | 1.8% |
