Ethan Allen(US:ETD)2022-08-28 16:00Retail Operations - As of June 30, 2022, Ethan Allen operates 141 retail design centers, with 137 in the United States and 4 in Canada[18]. - Retail segment net sales accounted for 84.4% of consolidated net sales in fiscal 2022, while the wholesale segment accounted for 15.6%[61]. - The retail segment's profitability reflects retail gross margin and other operating costs, with no customer concentration risks identified[67]. - The retail segment's product line revenue for fiscal 2022 was approximately 53% upholstered products, 27% case goods, and 20% home accents and other, showing a slight shift from fiscal 2021[68]. - The company opened multiple new design centers in fiscal 2022, including locations in Westport, CT, and Walnut Creek, CA, enhancing customer experience with technology[42]. - The company opened two new design centers during fiscal 2022 and closed one, indicating ongoing market expansion efforts[69]. Wholesale Operations - The company experienced a 31.7% increase in wholesale written orders during fiscal 2021, leading to a wholesale backlog of $102.4 million as of June 30, 2022, down 14.7% from $120.0 million a year ago[33]. - Ethan Allen's wholesale order backlog is up 120.8% compared to June 30, 2019, indicating sustained demand despite recent reductions[33]. - The wholesale segment accounted for 15.6% of net sales during fiscal 2022, with the largest customers representing 18% of sales in this segment[70]. - Within the wholesale segment, product line revenue was approximately 54% upholstered products, 30% case goods, and 16% home accents and other[74]. - The wholesale backlog was $102.4 million as of June 30, 2022, down 14.7% from the previous year but up 120.8% from June 30, 2019[81]. Manufacturing and Supply Chain - Approximately 75% of Ethan Allen's products are manufactured in North America, with the remaining 25% imported[31]. - The company experienced raw material price increases throughout fiscal 2022, impacting margins, but has begun to see stabilization in input costs[47]. - Raw material prices, particularly for upholstery and case goods, increased due to supply chain challenges, with expectations for high levels to persist due to inflation[32]. - The company continues to manage and evaluate logistics providers, expecting overall freight costs associated with imports to remain elevated due to inflationary pressures[50]. - The majority of products are manufactured on a custom made-to-order basis, with certain items stocked for quick delivery[86]. Financial Performance - The company has a strong balance sheet with $121.1 million in cash and investments and no outstanding borrowings as of June 30, 2022[38]. - The company reported a regular quarterly cash dividend of $0.21 per share reinstated in August 2020 after lifting temporary salary reductions and returning furloughed associates[26]. - Employee count as of June 30, 2022, totaled 4,239, with a 1.2% increase compared to the previous year[88]. - The company does not expect typical sales trends during fiscal 2023 due to high backlog levels and the impact of COVID-19[78]. Technology and Innovation - The company debuted a state-of-the-art immersive Virtual Design Center in June 2022, enhancing customer interaction and design capabilities[25]. - The company plans to further invest in its digital footprint, including expanding the Virtual Design Center to enhance customer experience[58]. - The company has invested in digital design technologies, including the EA inHome® augmented reality app and the 3D Room Planner, to enhance client experience[59]. Sustainability and Compliance - The Company requires sourcing facilities to implement a labor compliance program to prevent child labor and ensure a safe working environment[105]. - The company has implemented environmental initiatives, including the use of responsibly harvested woods and water-based finishes, as part of its sustainability efforts[103]. Corporate Governance - The Company holds trademarks, service marks, and copyrights for the Ethan Allen brand in the U.S. and many foreign countries, viewing them as valuable assets[106]. - The Company is subject to reporting and disclosure obligations from the SEC and local authorities[107]. - The Company provides access to its SEC filings and quarterly earnings calls through its Investor Relations website[110]. - Additional information regarding the Company's financial condition and operations can be found in the Management's Discussion and Analysis section of the Annual Report[112].