ANAHEIM, Calif., April 03, 2025--(BUSINESS WIRE)--EACO Corporation (OTC Pink: EACO) today reported the results for its quarter ended February 28, 2025.
Net sales, net income and earnings per share were as follows for the three months ended February 28, 2025 and February 29, 2024 (dollars in thousands, except per share information):
Three Months Ended
February 28,
2025
February 29,
2024
% Change
(unaudited)
(unaudited)
Net sales
$100,132
$83,335
20.2%
Net income
$6,763
$5,498
23.0%
Basic earnings per common share
$1.39
$1.13
23.0%
The Company had 445 sales employees at February 28, 2025, an increase of 31 employees or 7%, from the prior year quarter. The Company’s sales force is divided into sales focus teams (SFT’s). The Company had 114 SFT’s as of February 28, 2025, four more than the prior year quarter. Management anticipates continued growth in both our headcount and SFT’s in fiscal year 2025. The Company believes it continues to gain market share through its local presence business model.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
This press release contains certain forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1955, as amended. These forward-looking statements include, without limitation, statements related to our headcount expansion, growth in market share, and other statement that is not historical information. These forward-looking statements are based on our current expectations and are inherently subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. The potential risks and uncertainties include, but are not limited to, our ability to hire and retain additional qualified employees, our ability to open additional sales offices, and to gain market acceptance for our products, the pricing and availability of our products, the success of our sales and marketing programs, the impact of products offered by our competitors from time to time, and as well as increases to international tariffs. In addition to these factors and any other factors mentioned elsewhere in this news release, the reader should refer as well to the factors, uncertainties or risks identified in EACO’s most recent Form 10-K and all subsequent Form 10-Q reports filed by us with the SEC. The forward-looking statements included in this release speak only as of the date hereof, and EACO does not undertake any obligation to update these forward-looking statements to reflect subsequent events or circumstances.
EACO Corporation and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except share information)
(unaudited)
February 28,
August 31,
2025
2024*
ASSETS
Current Assets:
Cash and cash equivalents
$
499
$
843
Restricted cash
10
10
Trade accounts receivable, net
54,743
53,272
Inventory, net
79,377
69,602
Marketable securities, trading
15,081
14,748
Prepaid expenses and other current assets
4,325
3,526
Total current assets
154,035
142,001
Non-current Assets:
Property, equipment and leasehold improvements, net
34,529
35,061
Operating lease right-of-use assets
7,223
7,513
Other assets, net
3,970
3,963
Total assets
$
199,757
$
188,538
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Trade accounts payable
$
35,453
$
28,054
Accrued expenses and other current liabilities
15,545
24,910
Current portion of long-term debt
131
129
Current portion of operating lease liabilities
2,679
2,708
Total current liabilities
53,808
55,801
Non-current Liabilities:
Long-term debt
4,149
4,214
Operating lease liabilities
4,695
4,892
Total liabilities
62,652
64,907
Commitments and Contingencies Note 9
Shareholders’ Equity:
Convertible preferred stock, $0.01 par value per share; 10,000,000 shares authorized; 36,000 shares outstanding (liquidation value $900)
1
1
Common stock, $0.01 par value per share; 8,000,000 shares authorized; 4,861,590 shares outstanding
49
49
Additional paid-in capital
12,378
12,378
Accumulated other comprehensive income
(66
)
73
Retained earnings
124,743
111,130
Total shareholders’ equity
137,105
123,631
Total liabilities and shareholders’ equity
$
199,757
$
188,538
* Derived from the Company’s audited financial statements included in its Form 10-K for the year ended August 31, 2024 filed with the U.S. Securities and Exchange Commission on November 29, 2024.
EACO Corporation and Subsidiaries
Condensed Consolidated Statements of Income
(in thousands, except for share and per share information)
(unaudited)
Three Months Ended
Six Months Ended
February 28,
2025
February 29,
2024
February 28,
2025
February 29,
2024
Net sales
$
100,132
$
83,335
$
194,052
$
163,590
Cost of sales
70,624
58,308
136,763
114,991
Gross margin
29,508
25,027
57,289
48,599
Operating expenses:
Selling, general and administrative expenses
20,414
17,598
39,352
34,815
Impairment on termination of lease
–
–
–
3,906
Income from operations
9,094
7,429
17,937
9,878
Other income (expense):
Net gain (loss) on trading securities
30
23
484
(21
)
Interest and other (expense)
(49
)
(75
)
(97
)
(84
)
Other (expense) income, net
(19
)
(52
)
387
(105
)
Income before income taxes
9,075
7,377
18,324
9,773
Provision for income taxes
2,312
1,879
4,673
2,496
Net income
6,763
5,498
13,651
7,277
Cumulative preferred stock dividend
(19
)
(19
)
(38
)
(38
)
Net income attributable to common shareholders
$
6,744
$
5,479
$
13,613
$
7,239
Basic earnings per share:
$
1.39
$
1.13
$
2.80
$
1.49
Basic weighted average common shares outstanding
4,861,590
4,861,590
4,861,590
4,861,590
Diluted earnings per share:
$
1.38
$
1.12
$
2.79
$
1.48
Diluted weighted average common shares outstanding
4,901,590
4,901,590
4,901,590
4,901,590
EACO Corporation and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
Six Months Ended
February 28,
2025
February 29,
2024
Operating activities:
Net income
$
13,651
$
7,277
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
858
806
Bad debt expense
144
135
Deferred tax provision
(28
)
40
Net unrealized (gain) loss on trading securities
(100
)
267
Impairment on termination of lease
–
3,906
Increase (decrease) in cash flow from change in:
Trade accounts receivable
(1,615
)
(468
)
Inventory
(9,775
)
(7,483
)
Prepaid expenses and other assets
(778
)
751
Operating lease right-of-use assets
290
5,296
Trade accounts payable
5,881
3,404
Accrued expenses and other current liabilities
(9,365
)
(8,166
)
Operating lease liabilities
(226
)
(5,305
)
Net cash (used in) provided by operating activities
(1,063
)
460
Investing activities:
Purchase of property, equipment, and leasehold improvements
(326
)
(32,208
)
Net (purchases) sales of marketable securities, trading
(233
)
25,283
Net cash used in investing activities
(559
)
(6,925
)
Financing activities:
Repayments on long-term debt
(63
)
(62
)
Preferred stock dividend
(38
)
(38
)
Bank overdraft
1,518
2,077
Net cash provided by financing activities
1,417
1,977
Effect of foreign currency exchange rate changes on cash and cash equivalents
(139
)
(86
)
Net decrease in cash, cash equivalents, and restricted cash
(344
)
(4,574
)
Cash, cash equivalents, and restricted cash - beginning of period
853
8,568
Cash, cash equivalents, and restricted cash - end of period
$
509
$
3,994
Supplemental disclosures of cash flow information:
