In the retail segment, net sales saw a more pronounced decline, dropping by 19 per cent to $139.2 million. The wholesale segment also experienced a downturn, with net sales decreasing by 14.7 per cent to $90.6 million. Furthermore, written order trends in the retail and wholesale segments decreased by 9.4 per cent and 10.9 per cent, respectively.

The consolidated gross margin for the company stood at 60.2 per cent, which is 80 basis points lower than the same period last year. The operating margin was reported at 13 per cent, with an adjusted operating margin of 12.8 per cent, a significant decrease compared to 18.1 per cent in the previous year, the company said in a press release.

Ethan Allen maintained its advertising expenses, which were equal to 2 per cent of net sales in both the current and prior-year period.

The diluted earnings per share (EPS) for Q2 FY24 stood at $0.68, a decrease from $1.10 in the same period last year. The adjusted diluted EPS was reported at $0.67.

As of December 31, 2023, Ethan Allen's net inventories totalled $140.9 million, showing a reduction from $149.2 million as of June 30, 2023.

“We are pleased to report our financial and operating results for the fiscal 2024 second quarter ended December 31, 2023, marked by lower sales, strong gross and operating margins and a robust balance sheet. The pandemic period, defined by us as fiscals 2021 through 2023, had strong consumer focus on the home, high demand and major increases in sales. We had record high backlogs, which are now returning to pre-pandemic levels. During this pandemic period, we undertook many important initiatives within our vertically integrated enterprise, including strengthening our talent, marketing, service, technology and social responsibility,” said Farooq Kathwari, Ethan Allen’s chairman, president, and CEO.

Fibre2Fashion News Desk (DP)