Ethan Allen Reports Fiscal 2025 Second Quarter Results

Ethan Allen Interiors Inc. (“Ethan Allen” or the “Company”), a leading interior design destination, reported its results for the fiscal 2025 second quarter ended December 31, 2024.

Farooq Kathwari, Ethan Allen’s Chairman, President and CEO commented, “We are pleased with our performance that saw incremental consumer interest return back to the home amidst a challenging political and economic environment. We are positioned well as a vertically integrated enterprise with 172 retail design centers in North America and more internationally. Our ability to manufacture approximately 75% of our furniture in our own North American facilities is a major advantage. We continue to strengthen various areas of our enterprise, including our talent, product offerings, marketing, retail network, manufacturing, logistics, technology and social responsibility.”

“For the quarter ended December 31, 2024, we reported consolidated net sales of $157.3 million, gross margin of 60.3%, operating income of $18.2 million, operating margin of 11.5% and diluted EPS of $0.59. We had strong operating cash flow and ended the quarter with total cash and investments of $184.2 million, up $16.4 million from a year ago. We paid $10.0 million in cash dividends during the second quarter and are pleased to announce that yesterday our Board approved a regular quarterly cash dividend of $0.39 per share, payable on February 26, 2025.”

“As previously mentioned during our 2024 International Convention held in December, we are Focused on the Future. We offer relevant, high-quality products and provide interior design services with state-of-the-art technology, a great advantage for us. We look forward to continued progress and remain cautiously optimistic,” concluded Mr. Kathwari.

Fiscal 2025 Second Quarter Highlights*

• Consolidated net sales of $157.3 million; prior year $167.3 million
  • Retail net sales of $134.3 million; prior year $139.2 million
  • Wholesale net sales of $86.8 million; prior year $90.6 million
• Written order trends
  • Retail segment written orders increased 15.8%
  • Wholesale segment written orders rose 14.3%
• Consolidated gross margin of 60.3%; prior year 60.2%
• Operating margin of 11.5%; adjusted operating margin of 11.5% compared with 12.8% last year
• Advertising expenses were equal to 2.5% of consolidated net sales, up from 2.0% in the prior year
• Diluted EPS of $0.59; prior year $0.68
• Generated $11.6 million of cash from operating activities; prior year $13.6 million
• Paid cash dividends totaling $10.0 million or $0.39 per share, up 8.3% from a year ago
• Ended the quarter with $184.2 million in total cash and investments with no debt outstanding
• Inventory carrying levels totaled $142.0 million at December 31, 2024, up $1.1 million from a year ago
• Ended the quarter with 3,318 total employees, down 6.9% from a year ago and 27.0% less than at December 31, 2019
• Operated 172 Ethan Allen retail design centers in North America at December 31, 2024, including 141 Company-operated and 31 independently owned and operated locations; the Company also has design centers outside of North America

• Ethan Allen’s North Carolina distribution center that previously sustained flooding from Hurricane Helene in September 2024 resumed operations during the second quarter
• In December 2024, the Company held its 2024 International Convention live at its headquarters and livestreamed across the world; under the theme of Focused on the Future, the program honored Ethan Allen’s 92-year history, reviewed current and future initiatives in manufacturing, logistics, technology, marketing and retail, and celebrated interior designers both for achievement in written sales and design excellence
• The Sustainable Furnishings Council and the National Wildlife Federation recently recognized Ethan Allen for its wood-sourcing policies and commitment to sustainable wood used to make the furniture they sell; Ethan Allen was awarded the designation of “Most Improved” for 2024, which is given to only one furniture retailer per year
• Ethan Allen’s upholstery operations in Silao, Mexico was recently awarded the Great Place to Work® certification for the seventh consecutive year; in addition to this designation, the Silao operations was recognized as “Empresa Socialmente Responsible” (Environmentally and Socially Responsible)

* See reconciliation of GAAP to adjusted key financial measures in the back of this release. Comparisons are to the fiscal 2024 second quarter.

Balance Sheet and Cash Flow

Cash and investments totaled $184.2 million at December 31, 2024, compared with $195.8 million at June 30, 2024. The decrease during the first six months of fiscal 2025 was due to $30.1 million in cash dividends paid and capital expenditures of $7.4 million partially offset by $26.7 million in cash generated from operating activities, as the Company continued to return capital to shareholders and reinvest back into the business.

Cash from operating activities totaled $26.7 million during fiscal 2025, a decrease from $30.3 million in the prior year period due to lower net income and changes in working capital.

Cash dividends paid during the first six months of fiscal 2025 totaled $30 million, which included a special cash dividend of $10 million, or $0.40 per share, and regular quarterly cash dividends totaling $20 million, or $0.39 per share, an 8.3% increase from last year’s regular quarterly dividend of $0.36 per share.

Inventories, net totaled $142.0 million at December 31, 2024, consistent with June 30, 2024. Inventory levels have stabilized as the Company aligns its inventory with incoming order trends while also ensuring appropriate levels are maintained to service customer orders.

Customer deposits from undelivered written orders totaled $70.8 million at December 31, 2024, down from $73.5 million at June 30, 2024. Wholesale backlog was $57.7 million at December 31, 2024, up 5.0% from a year ago and 7.7% higher than June 30, 2024 due to the timing of incoming contract orders.

No debt outstanding at December 31, 2024.

Dividends

On October 29, 2024, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.39 per share, which was paid on November 27, 2024. More recently, on January 28, 2025, the Board of Directors declared a regular quarterly cash dividend of $0.39 per share, payable on February 26, 2025 to shareholders of record as of February 11, 2025. Ethan Allen has a long history of returning capital to shareholders and is pleased to pay a quarterly cash dividend, which highlights the Company’s strong balance sheet and operating results.

For full results click here.

About Ethan Allen

Ethan Allen (NYSE:ETD), recently named America’s #1 Premium Furniture Retailer and among America’s Top 10 Retailers by Newsweek, is a leading interior design destination combining state-of-the-art technology with personal service. Our design centers, which represent a mix of independent licensees and Company-owned and operated locations, offer complimentary interior design service and sell a full range of home furnishings, including custom furniture and artisan-crafted accents for every room in the home. Vertically integrated from product design through logistics, we manufacture about 75% of our custom-crafted products in our North American manufacturing facilities and have been recognized for product quality and craftsmanship since 1932. Learn more at www.ethanallen.com and follow us on Facebook, Instagram, and LinkedIn.

Contact:

Matt McNulty – Senior Vice President, CFO and Treasurer – IR@ethanallen.com

Source: Ethan Allen Interiors Inc.