by DANBURY, Ct. – Ethan Allen reported an increase in consolidated net sales and net income for its third fiscal quarter ended March 31.
The company reported net sales of $197.7 million, up 11.7% from the $176.9 million reported the same period last year. The company’s retail sales rose nearly 18% to $166.7 million and its wholesale net sales rose 12.3% to $121 million.
Its net income during the quarter was $27.4 million, up 58.3% from the $15.6 million reported last year.
The company also reported that wholesale orders fell .2% from the same period last year, but were up 8.4% from the same period of fiscal 2019. Meanwhile, written orders for the retail segment fell 3%, from the same quarter last year, but were up 18.2% from the third quarter of fiscal 2019.
In addition consolidated gross margin rose to 60.4%. The company said this was due to strong retail segment sales, product pricing actions, a favorable product mix and higher manufacturing production partially offset by higher input and freight costs. This compares to 57.3% in the same period last year.
It also had an operating margin of 16.5% compared to 10.7% last year.
Company President and CEO Farooq Kathwari said the company was pleased to report double digit growth in sales, income and earnings per share for the quarter.
“Our vertically integrated business continues to produce strong results and positions us for future growth,” he said. “Sales increased 11.7% to $197.7 million, gross margin increased to 60.4%, and operating margin rose to 16.5%, resulting in diluted EPS of $0.97, an increase of 59.0%. We paid regular quarterly cash dividends and ended the quarter with a strong balance sheet, including cash and investments of $104.6 million as of March 31, 2022 and no debt. We have paid an annual cash dividend every year since 1996 and have increased our quarterly cash dividend each of the past three years.”
He added that despite the challenges faced during the quarter, the company is working to improve efficiencies, work through its backlog and “service customers and consumers while achieving strong profitability.”
“We also took selective price increases to counter rising raw material, freight and labor costs,” he added. “While we are pleased with our third quarter performance, we also recognize there are several external factors, such as record inflation, rising interest rates, supply chain challenges and global unrest, that have created higher levels of uncertainty. We expect to see softening consumer interest in home furnishings and to address this expected trend, we remain focused on maintaining strong marketing programs, differentiation of relevant offerings, strong and talented associates, and control over our manufacturing and logistics. We remain cautiously optimistic.”
