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Ethan Allen earnings up 13.4%

By Larry Thomas -- Furniture Today, January 22, 2006

Danbury, Conn. — Buoyed by a healthy same-store increase from its national network of dedicated stores, retailer-manufacturer Ethan Allen said sales were up 12.5% in its second quarter ended Dec. 31. Net income rose 13.4% in the same period.

"We are very pleased with our results for the quarter," said Chairman and CEO Farooq Kathwari. "We believe the structural changes undertaken within our business during the past three years ... played an important role in our ability to increase sales, operating income and earnings per share."

Net delivered sales in the three months totaled $276 million, up from $245.3 million in last year's comparable quarter. Net income came to $26.2 million, or 77 cents per share, compared with $23.1 million, or 63 cents per share, a year ago.

The company said net delivered sales at its 313 stores rose 15.5% to $180 million during the quarter. Same-store sales, a key performance measure from stores open at least a year, increased 6.3% in the quarter.

Kathwari said a company-wide effort to reduce the time it takes to deliver orders to consumers played a key role in the sales growth. "As a result of this initiative, we were able to substantially reduce our delivery time and backlog during the quarter," he said.

In the six months, net delivered sales rose 10.9% to $527.3 million. Net income rose 3.3% to $43.3 million, or $1.26 per share.

During a conference call with securities analysts, Kathwari said about 10 Ethan Allen stores will be opened this year.

Ethan Allen
Earnings per share are fully diluted.
Quarter ended 12/31	2005	2004	Change
(a) Includes a pretax restructuring credit of $52,000. (b) Includes a pretax restructuring charge of $4.2 million. (c) Includes a pretax restructuring credit of $219,000. (d) Based on average shares outstanding of 33.8 million in the 2005 quarter, 36.6 million in the 2004 quarter, 34.2 million in the 2005 six months, and 36.8 million in the 2004 six months.
Sales	$276,003,000	$245,252,000	12.5%
Operating income	44,288,000	36,523,000	21.3%
Net income	26,164,000	(a) 23,134,000	13.1%
Earnings per share (d)	0.77	0.63	22.2%
6 months ended 12/31	2005	2004	Change
Sales	$527,317,000	$475,598,000	10.9%
Operating income	76,723,000	67,311,000	14.0%
Net income	(b) 43,294,000	(c) 41,892,000	3.3%
Earnings per share (d)	1.26	1.14	10.5%

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