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Ethan Allen sales climb 5.7% in latest quarter

Larry Thomas -- Furniture Today, January 25, 2012

DANBURY, Conn. — Ethan Allen said sales for the second fiscal quarter were 5.7% above the same quarter last year, as the manufacturer and retailer experienced strong order-writing at its 300 retail design centers.

Retail division sales rose 9.2% and comparable-store sales grew 6.5%.

Total sales for the quarter ended Dec. 31 were $183.3 million, up from $173.3 million in the same quarter the previous year.

Net income was $8.08 million or 28 cents per share, down from $14.7 million or 51 cents per share, in the comparable period. Both quarters, however, had a variety of restructuring and impairment charges, and the company had a $6 million tax credit a year ago but a $3.7 million tax expense in the most recent quarter.

Without those special items, net income in the most recent quarter was $8.6 million or 30 cents per share. It was $5.6 million or 19 cents per share in the comparable period the previous year.

"We are pleased with the strong 5.7% growth in sales as it builds upon the 21% growth in the previous year quarter," said Farooq Kathwari, chairman and CEO. "We continue to benefit from major initiatives during the last three years resulting in operating leverage, with gross margin increasing from to 53.6% from 51.8%."

Kathwari also noted the company reduced its debt by $10 million during the quarter, bringing total debt reduction to $43.6 million over the last 12 months.

"We remain cautiously optimistic due to our many initiatives, including major introductions of new products, acquiring qualified and entrepreneurial interior design associates, investing in our manufacturing and logistics, and adding technology in all areas of our enterprise," he said. "We also see improving trends in consumer attitudes."

For the six months ended Dec. 31, sales rose 8.9% to $368.2 million. Net income was $14.8 million or 51 cents per share. That was down from $18.6 million or 64 cents per share in the comparable period the previous fiscal year.

Excluding the restructuring and impairment charges, net income was $15.8 million or 54 cents per share, compared with $8.7 million or 30 cents per share in the comparable period.

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