DANBURY, CT - Ethan Allen Interiors Inc. (NYSE: ETH) today reported operating results for the three and twelve months ended June 30, 2014. Please refer to the accompanying financial statements and reconciliation to non-GAAP measures discussed below.

Fourth Quarter Highlights:

Net sales of $198.8 million increased 9.1% compared to fourth quarter of fiscal 2013

Adjusted EPS grew 47.1% to $0.50 compared to fourth quarter of fiscal 2013; GAAP EPS increased 107.1% to $0.58

Gross margin increased 60 basis points to 54.6% compared to fourth quarter of fiscal 2013

Adjusted Operating Income of $24.9 million increased 42.4% compared to fourth quarter of fiscal 2013; GAAP Operating Income increased 47.5%.

Retail division net sales increased 7.1%, and generated adjusted operating income of $8.7 million for an adjusted operating margin of 5.6% compared to 2.9% for the fourth quarter of fiscal 2013.

Cash and securities of $135.8 million increased $32.3 million or 31.2% over June 30, 2013.

Capital Expenditures were $19.3 million year to date at June 30, 2014 compared to $19.0 million prior year and inventories of $146.3 million increased as planned by $9.0 million over June 30, 2013.

Retail division Written Sales decreased 5.5% compared to fourth quarter of fiscal 2013, Comparable Written Sales decreased 4.1% during the same time period.

Regular quarterly cash dividend of $0.12 per share declared; an increase of 20%

Fiscal Year ending June 30, 2014 Highlights:

Net sales of $746.7 million increased 2.4% compared to fiscal 2013

Adjusted diluted earnings per share (EPS) grew 10.7% to $1.45 compared to 1.31 for fiscal 2013; GAAP EPS increased 32.4% to $1.47 compared to $1.11 in fiscal 2013

Adjusted Operating Income of $74.3 million increased 7.9% compared to fiscal 2013; GAAP Operating Income increased 15.2%

Adjusted Net Income of $42.6 million increased 10.8% compared with fiscal 2013; GAAP Net Income increased 32.2%

Farooq Kathwari, Chairman and CEO commented, "We are pleased with our strong performance reflecting continued improvement to our vertically integrated enterprise and the performance of the Company's retail division. These results reflect the leverage of our vertical structure. While our written business in the retail division for the fourth quarter was lower compared to last year, it was impacted by several factors including our decision to shift the end date of the June sale to July 7th to take advantage of timing of the July 4th holiday and the July 8th price increase which resulted in some of the end of sale written orders to shift into July, the somewhat sluggish retail environment and the timing of Easter falling in the fourth quarter this year. We are also pleased to have increased our quarterly dividend by 20%."

Mr. Kathwari continued "As we have stated previously, we are in the process of a major re-positioning of our brand including a major introduction of new products, improving the projection of our design centers, continued relocation and opening of new design centers, introduction of an improved website this coming Fall and a major focus of expansion of our North American manufacturing".

Mr. Kathwari concluded "July through September will be a period of transition with the sale of floor samples and inventory to make room for new products, remodeling to improve the projection of our design centers and producing new products most of which are made in our North American workshops. We plan to accelerate our marketing in the second quarter of fiscal 2015 and further accelerate in the third and fourth quarter. We remain cautiously optimistic."

Fiscal 2014 Fourth Quarter Financial Results:

Consolidated net sales for the quarter ended June 30, 2014 increased 9.1% over the prior year to $198.8 million. The Company's wholesale segment net sales increased 8.8%. The Company's retail segment net sales increased 7.1% to $155.6 million including a comparable design center net sales increase of 9.7%. Net income for the quarter ended June 30, 2014 was $17.1 million or $0.58 per diluted share compared with $8.2 million or $0.28 per diluted share in the prior year quarter. Earnings per diluted share reflect the Company's reversal of deferred tax asset valuation allowances and certain other tax adjustments resulting in a net tax effect of $2.8 million recognized during the quarter. Excluding these benefits and other special items in both periods, adjusted earnings for the quarter were $0.50 per diluted share or $14.6 million compared to $0.34 per diluted share or $9.9 million in the prior year quarter. In addition, the Company's Board of Directors declared a regular quarterly cash dividend of $0.12 per share, an increase of 20%, which will be payable to shareholders of record as of October 9, 2014 and will be paid on October 24, 2014..

Fiscal 2014 Year-to-Date Financial Results:

Year to date net sales were $746.7 million, up 2.4% from $729.1 million the prior year. Gross margin and adjusted operating profit margin were 54.4% and 9.9% respectively compared with 54.6% and 9.4% respectively the prior year. Adjusted net income year to date of $42.6 million compares with $38.4 million the prior year period and our adjusted earnings per diluted share for the twelve months to date is $1.45 compared with $1.31 the prior year to date period.