From Home Furnishing Business
Ethan Allen Eyes 2% Sales Increase in Fiscal Q2
Furniture manufacturer and retailer Ethan Allen (NYSE: ETH) said it expects to report a 2% sales increase for the quarter ended Dec. 31, along with adjusted earnings per share of 51 cents to 52 cents.
If the earnings projection is on target, it would be well above the 39 cents per share reported in the same quarter the previous year.
A preliminary financial report issued Tuesday said the increases occurred despite a 5.8% decline in retail written orders, which include merchandise sold but not delivered.
"Although written orders were impacted by lower traffic and weather-related issues, there was a steady positive momentum during the quarter, with December written orders up from the previous year's levels,” said Farooq Kathwari, chairman, president and CEO.
He said the adjusted earnings per share estimate reflects an effective tax rate of 17% for the quarter, compared with an effective rate of 36.5% in the same quarter the previous year. The drop is due to the massive tax bill signed in late December by President Donald Trump.
"We plan to increase our marketing spend starting in our third quarter as major new products are in place, including Uptown collection, which will be introduced this spring," Kathwari said. "While early in the month, the January written order trend is positive. Our manufacturing, sourcing and logistics are in a strong position to service increased sales."
Ethan Allen will release complete financial results for the quarter – the second quarter of its fiscal year – on Jan. 24.