Ethan Allen Posts $3.3 Million Loss in 2Q

January 27, 2010  by in UnCategorized   

By Home Furnishings Business in Financial Reports on January 28, 2010 Danbury, Conn.-based Ethan Allen (NYSE:ETH) reported a net loss of $3.3 million for the second quarter ended Dec. 31, compared to a $5.5  million profit posted during the same quarter last fiscal year.

Sales for the quarter were $143 million, compared to $189.6 million in the prior year quarter. Wholesale net sales were $84.5 million versus $108.8  million for the second quarter in the previous year.

For the six month period, the company reported a net loss of $16.9 million, compared to a profit of $12.9 million during the same period last year. Sales for the first half of the year were $279.5 million, compared to $395.4 million in the prior year period.

"The challenges of the past year have provided us an opportunity to significantly strengthen many elements of our vertically integrated enterprise while at the same time increasing our cash position from June 30 by 44 percent to $76 million at December 31, 2009," said Farooq Kathwari, chairman, president and CEO.

"The consolidation and restructuring initiatives did result in lower delivered sales in the December quarter while increasing our backlogs," he said. "Our plants, retail and logistics have absorbed most of the operational changes and transition costs during the last six months. This includes the training of 274 new upholstery associates and the conversion of our case goods products to custom. We expect to significantly lower these costs in the third and fourth quarters of this fiscal year."

He continued that the company has strong marketing initiatives in place and that it plans to increase production in both its domestic case goods and upholstery.