by Company has double-digit uptick in retail written orders compared with the prior quarter
DANBURY, Conn. — Ethan Allen Interiors Inc. saw a drop in margins for its first fiscal quarter ended Sept. 30 that it said resulted from lower sales and tariffs.
However, its business was bolstered by a strong cash position and a double-digit uptick in retail written orders when compared to its previous quarter.
Sales totaled $129.6 million, compared with $147 million the same quarter last year, down 11.8%. Retail net sales for the quarter totaled $114.4 million, compared with $128.6 million last year, down 11%. By comparison, wholesale net sales totaled $79 million, down 9.2% from $87 million last year.
Year-over-year retail written orders were down 1.2% and wholesale segment written orders were down 1.3%, which the company attributed to lower design center traffic, a soft housing market, global unrest and uncertainty with the mid-term elections. However, retail written orders rose 13.2% compared with the fourth quarter.
Net income totaled $1.7 million, or 7 cents per share compared with $10.5 million, or 41 cents per share the same period last year.
Gross profit totaled $77.3 million, or 59.6% of sales, compared with $90.2 million, or 61.4% of sales last year. Operating income totaled $1.6 million, compared with $10 million last year and SG&A expenses totaled $75.1 million, or 57.9% of sales, compared with $79.7 million, or 54.2% of sales last year.
Other highlights during the quarter were as follows:
+ The company said that its marketing spend was $4.7 million or 3.6% of consolidated net sales compared with 3.5% last year. It anticipates higher marketing expenses during the remainder of fiscal 2027.
+ Capital expenditures totaled $3.4 million, compared with $2.4 million a year earlier. The company said the increase supported new retail design centers, additional manufacturing equipment and technology upgrades.
+ During the quarter Ethan Allen opened new company-operated design centers in Aventura, Florida, and Victoria Gardens, California, “showcasing Ethan Allen home furnishings and combining complimentary interior design services with technology.”
+ It ended the quarter with 172 Ethan Allen retail design centers in North America, including 142 company-operated locations and 30 independently owned and operated locations.
+ Additional new design center locations planned for fiscal 2027 include Burlington, Vermont; Huntersville, North Carolina; and Naples, Florida.
+ The company ended the quarter with 2,988 associates, down 6.3% from less than a year ago
+ It reported cash, cash equivalents and investments of $92.2 million as of Sept. 30, compared with $187.5 million at June 30. The $95.3 million decrease reflects the payment of $92.2 million in cash dividends and capital expenditures of $3.4 million
+ Cash used in operating activities totaled $800,000 during the first quarter of fiscal 2027, down from $16.8 million from operating activities in the prior year due to lower net income, incremental restructuring payments and working capital changes partially offset by insurance proceeds received
+ During the quarter it paid $92.2 million in cash dividends, including special dividends of $3.25 per share in addition to a regular quarterly dividend of 39 cents per share
+ Net merchandise inventory levels were $153.8 million at Sept. 30, up 3.6% since June 30, reflecting new product introductions and price increases
+ Customer deposits from undelivered written orders totaled $74.3 million at Sept. 30, up from $62.7 million at June 30, “as the pace of incoming retail segment written orders improved and outpaced delivered sales.”
+ The company said its wholesale backlog was $55 million at Sept. 30, up 2.7% over the prior year
+ It also reported no outstanding debt at Sept. 30, and credit availability of $121.5 million
