In This Article:
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Consolidated Net Sales: $142.7 million, reflecting lower delivered unit volume but higher average ticket price and improved contract sales.
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Gross Margin: 61.2%, driven by lower raw material costs and reduced headcount.
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Adjusted Operating Margin: 8%, compared to 10% a year ago.
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Adjusted Diluted EPS: $0.38, compared to $0.48 a year ago.
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Operating Cash Flow: $10.2 million generated during the third quarter.
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Total Cash and Investments: $183 million, with no outstanding debt.
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Retail Segment Written Orders: Down 13.2%.
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Wholesale Orders: Decreased by 11.2%.
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Wholesale Backlog: $54.6 million as of March 31.
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Headcount: 3,294, a decrease of 4.5% from a year ago.
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Capital Expenditures: $2.0 million, including new retail design centers and manufacturing equipment.
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Quarterly Cash Dividend: $0.39 per share, with a current yield of 5.4%.
Release Date: May 05, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Ethan Allen Interiors Inc (NYSE:ETD) reported strong gross margins of 61.2% driven by lower raw material costs, reduced headcount, and higher average ticket prices.
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The company maintained a robust balance sheet with $183 million in cash and no outstanding debt.
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Ethan Allen Interiors Inc (NYSE:ETD) has a strong North American manufacturing presence, producing 75% of its furniture domestically, which minimizes tariff impacts.
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The company continues to pay regular quarterly cash dividends, with a current yield of 5.4%, one of the highest in the industry.
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Ethan Allen Interiors Inc (NYSE:ETD) has successfully leveraged technology to improve operational efficiency, reduce headcount by 36% since 2019, and enhance marketing reach.
Negative Points
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Consolidated net sales were $142.7 million, reflecting lower delivered unit volume despite higher average ticket prices.
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Retail segment written orders decreased by 13.2%, and wholesale orders decreased by 11.2%, indicating a challenging demand environment.
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The adjusted operating margin decreased to 8% from 10% a year ago, reflecting tighter expense management but lower profitability.
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The company experienced softness in demand during January and February due to weather, tariff uncertainty, and reduced traffic.
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Ethan Allen Interiors Inc (NYSE:ETD) faces challenges from elevated interest rates and a difficult housing market, impacting overall demand.
Q & A Highlights
Q: How do tariffs affect Ethan Allen's positioning in the industry, and are you seeing price increases from competitors? A: Farooq Kathwari, CEO, explained that Ethan Allen is less impacted by tariffs due to its North American manufacturing base, with only a small portion of products affected by tariffs. The company has not raised prices yet but will consider it if necessary. Competitors with more offshore dependency may need to increase prices more significantly.