Ethan Allen sees drop in fiscal Q1 sales and net income
Clint Engel -- Furniture Today, October 24, 2013
DANBURY, Conn. — Ethan Allen's net sales slumped 3.1% in its fiscal first quarter and net income was off 10.9%, but the upscale retailer and manufacturer said written business was up despite consumer jitters over an impending government shutdown.
Net sales for the period ended Sept. 30 decreased to $181.7 million from $187.4 million for the same period a year ago. Its retail division sales were off 4.9% to $141.8 million and same-store sales declined 3%.
Net income for the quarter decreased to $9.0 million or 31 cents per diluted share from $10.1 million or 35 cents per share.
Still, written business in the retail division during the quarter, increased 11.4% and comparable written sales were up 13.8%, "despite the uncertainty expressed by our clients as a result of the recent government shutdown," said Chairman and CEO Farooq Kathwari.
He said lower nets sales in the quarter reflected lower backlog at the start of the period, a comparison to strong first quarter sales a year ago. The company also had higher clearance sales this past quarter to make room for an October launch of new goods.
"We are very pleased with our progress of re-introducing Ethan Allen as a fashion brand and reaching a larger customer base," Kathwari said in a statement, noting the company's new marketing program that began this month.
"The ‘bickering' in Washington made consumers nervous; otherwise, we believe we would have had an opportunity to have even higher written business in the first quarter. We also saw continued hesitancy in the first two weeks of October.
"We now see our clients starting to get more focused on decorating their homes, and as a result we remain cautiously optimistic as we move forward."
Danbury, Conn.-based Ethan Allen owns and operates eight manufacturing plants and sells through a network of about 300 Design Centers in the United States and abroad.
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