On this page of StockholderLetter.com we present the latest annual shareholder letter from ETHAN ALLEN INTERIORS INC — ticker symbol ETD. Reading current and past ETD letters to shareholders can bring important insights into the investment thesis.
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9/27/2024 Letter Continued (Full PDF)
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9/29/2023 ETD Stockholder Letter
• More "Home Furnishings & Furniture" Category Stockholder Letters
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ETD Benford's Law Stock Score = 87
9/27/2024 Letter Continued (Full PDF)
•
9/29/2023 ETD Stockholder Letter•
More "Home Furnishings & Furniture" Category Stockholder Letters•
ETD Benford's Law Stock Score = 87ETD Shareholder/Stockholder Letter Transcript:
2024 ANNUAL REPORT cf balance sheet data income statement data FINANCIAL HIGHLIGHTS 2024 2023 $646,221 $791,382 $817,762 60.8% 60.7% 59.3% Adjusted operating income (a) $77,914 $133,514 $134,240 Adjusted operating margin (a) 12.1% 16.9% 16.4% Adjusted net income (a) $63,758 $103,057 $100,277 Adjusted diluted EPS (a) $2.49 $4.03 $3.93 Cash and investments $195,801 $172,707 $121,118 Total assets $744,917 $745,453 $719,895 Total liabilities $262,001 $274,447 $312,572 Shareholders equity $482,916 $471,006 $407,323 Working capital $178,987 $196,356 $131,106 13.4% 23.5% 26.4% 2.16 2.20 1.61 3,404 3,748 4,239 25,411,923 25,356,462 25,322,792 $80,195 $100,664 $69,356 Capital expenditures $9,606 $13,885 $13,387 Cash dividends paid $50,269 $46,357 $48,257 5.6% 5.1% 6.3% Net sales Gross margin Long-term debt key metrics Adjusted return on equity (a) Current ratio Headcount Common shares outstanding liquidity Cash flows from operating activities Dividend yield (b) Amounts in thousands, except share and per share data (a) See reconciliation of U.S. GAAP to adjusted key financial measures in this annual report (b) Calculated as of June 30 th of each fiscal year presented 2022 DEAR FELLOW SHAREHOLDERS I am pleased to report strong performance in this post-pandemic period despite lower demand and reductions in available backlog. We delivered solid financial results to our shareholders during fiscal 2024 and strengthened all areas of our vertically integrated enterprise including talent, marketing, service, technology, and social responsibility. Strong operating margins For the year ended June 30, 2024, we achieved a strong operating margin of 12.1% and consolidated net sales of $646.2 million, with a gross margin of 60.8%. Adjusted diluted earnings per share totaled $2.49. Our balance sheet included total cash and investments of $195.8 million and no debt. We were pleased to pay cash dividends of $50.3 million, including an 8.3% increase to our regular quarterly cash dividend and a special $0.50 cash dividend. Classic design from a modern perspective Classic design with a modern perspective continues to be a differentiator for us. Using our vast assortment of products combined with technology, our designers are well equipped to offer a whole-home design solution. Using our powerful 3D room planning tools, designers can showcase projects in multiple locations: at the Design Center, at the client's home, or via online communication. Vertically integrated from concept to delivery Our vertically integrated enterprise, from manufacturing to logistics to retail, continues to be a competitive advantage, enabling us to achieve strong results despite lower demand and reductions in backlog. This structure provides us the ability to streamline inventory and headcount, manage our production and delivery timelines, and provide a wide range of custom options to our clients. Continual focus on reinvention We launched the very important initiative of creating The Interior Design Destination, which enhanced the projections in our Design Centers throughout North America and internationally. We curated a more functional layout and enhanced each location s use of technology to encourage designer-client collaboration. Reinvestment in North American manufacturing We continue to craft about 75% of our furniture in our own North American workshops and remain committed to producing furniture in North America. Significant investments in manufacturing technology were made during fiscal 2024 to ensure safety and enhance operations standards across our enterprise. Culture of social responsibility We are committed to good corporate governance and environmental stewardship as well as running a socially responsible business. We are also committed to making positive contributions to the communities in which we operate and treating every associate with dignity and respect. Ethan Allen was named America s Best Retailer in the Premium Furniture category by Newsweek for the second year in the row. This recognition is a credit to each of our associates. As we celebrate our 92nd year in business, I thank them, our Board of Directors, our clients, and all shareholders for their continued support. I look forward to continuing our progress in 2025 and remain cautiously optimisitc. Farooq Kathwari Chairman, President and CEO Ethan Allen Interiors Inc. 4 6 CLASSIC DESIGN FROM A MODERN PERSPECTIVE 8 VERTICALLY INTEGRATED FROM CONCEPT TO DELIVERY 10 CONTINUAL FOCUS ON REINVENTION 12 REINVESTMENT IN NORTH AMERICAN MANUFACTURING 14 CULTURE OF SOCIAL RESPONSIBILIT Y 15 ETHAN ALLEN BY THE NUMBERS welcome to the INTERIOR DESIGN DESTINATION