Loading...
•
Dec 31, 2019
Ethan Allen Q2 2020 Earnings Report
Ethan Allen's financial performance declined due to the implementation of the Ethan Allen Member Program and cautious consumer spending.
Key Takeaways
Ethan Allen reported a decrease in net sales and earnings per share for the second quarter of fiscal year 2020, primarily due to the transition to a membership model and cautious consumer spending. While gross margin improved, operating income decreased due to lower sales volume and increased advertising costs.
Consolidated net sales decreased by 11.5% compared to the same quarter last year.
Diluted earnings per share decreased to $0.27 compared to $0.45 a year ago.
The company's transition to the Ethan Allen Member Program impacted sales and profitability.
The company repurchased 545,727 shares and increased the share repurchase authorization to 3 million shares.
Ethan Allen
Ethan Allen
Ethan Allen Revenue by Segment
Revenue by Segment
Retail Net Sales Revenue
CapyFin.comWholesale Net Sales Revenue
CapyFin.com Forward Guidance
The implementation of the Ethan Allen Member Program was expected to impact sales and profitability during the initial year and, in particular, for the quarters ending December 31, 2019 and March 31, 2020.
Positive Outlook
- Strengthen product offerings, projection and marketing.
- Continue strong marketing in various mediums including television, digital, radio and print
- Unique vertical structure continues to provide strong operating leverage
- Continue to strategically repurchase shares.
- Continue to strengthen talent, marketing, retail network, products, manufacturing, logistics and technology
Challenges Ahead
- Impact our sales and profitability during the initial year
- Impact sales and profitability in the quarters ending December 31, 2019 and March 31, 2020.
- Retail consumers remained cautious with discretionary spending.
- Global economic uncertainty
- Transitioning its business from a promotional to a membership model
Revenue & Expenses
Visualization of income flow from segment revenue to net income