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FBI, Ethan Allen lower sales expectations

Larry Thomas -- Furniture Today, March 7, 2005

HIGH POINT -- Two of the biggest publicly held furniture companies, Furniture Brands International and Ethan Allen, said today that some of their numbers for the current quarter would be below Wall Street expectations.

Furniture Brands, the nation’s biggest manufacturer, said sales for the quarter ending March 31 would probably decline “in the mid-single digits” compared with last year’s first quarter. The company also said it expects earnings to be at the lower end of a range of 45 cents per share to 49 cents per share, which the company announced in January.

“This weakness in business is generally affecting both the middle-priced companies and the upper-end companies, but is more pronounced in the case goods business than in the upholstery business,” said Mickey Holliman, chairman and CEO. “We continue to believe the weakness in consumer confidence is the primary driver of dampened demand in the furniture industry.”

Furniture Brands owns Broyhill, Lane, Thomasville, Henredon, Drexel Heritage and Maitland-Smith.

Ethan Allen, meanwhile, said sales for the current quarter will be $225 to $230 million — about $20 million to $25 million below Wall Street estimates.

Farooq Kathwari, chairman and CEO, said the company’s recent move to an “everyday pricing” model has smoothed out peaks and valleys in order patterns, but will affect total sales for the quarter.

“During the prior year quarter, we experienced a 9% increase in delivered sales, so we find ourselves up against high comparisons,” Kathwari said. “(However), the change to everyday pricing has helped us to provide better customer service and improve the productivity of our design consultants and all those who support them.”

Ethan Allen products are sold exclusively through a network of 313 company owned and franchised stores. The company has 12 U.S. factories.

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