EACO Corporation Reports 15.9% Revenue Growth to $111.4 Million in Latest Quarter

EACO Corporation reported significant financial growth in its latest quarterly filing, with net sales reaching $111.4 million for the three months ended May 31, 2025, a 15.9% increase from $96.1 million in the same period last year. The company's gross profit also rose to $34.1 million, reflecting a 22% increase compared to $27.9 million in the prior year. This growth was attributed to an expanded sales force, which increased from 399 to 435 employees, enhancing customer acquisition and product sales. For the nine months ending May 31, 2025, EACO's net sales totaled $305.5 million, up 17.6% from $259.7 million in the previous year.

The company’s profitability improved significantly, with net income for the nine months ending May 31, 2025, reported at $23.2 million, compared to $8.5 million for the same period in 2024. This increase in profitability was supported by a reduction in selling, general, and administrative expenses, which decreased by 17.8% in the latest quarter, primarily due to a legal expense accrual related to a class action lawsuit that the company expects to settle. The effective tax rate remained stable at approximately 25.3% for the nine months ended May 31, 2025.

EACO has also made strategic moves, including the acquisition of its corporate headquarters in Anaheim, California, for $31 million, which was finalized in October 2023. This purchase is expected to enhance operational efficiency and reduce leasing costs. The company continues to expand its geographic footprint, with 51 sales offices and seven distribution centers across the U.S. and Canada, and one office in the Philippines. The increase in sales personnel and improved vendor relationships have contributed to higher inventory levels, which are crucial for meeting customer demand.

Operationally, EACO reported a total employee count of 632 as of May 31, 2025, up from 584 a year earlier. The company’s cash and cash equivalents increased to $7.3 million, compared to $843,000 in the previous year, alongside marketable securities valued at $22.1 million. The company’s line of credit was utilized minimally, with an outstanding balance of $491,000 as of May 31, 2025, reflecting prudent financial management.

Looking ahead, EACO anticipates continued growth driven by its expanded sales force and improved operational efficiencies. The company expects to maintain its upward trajectory in revenue and profitability, despite potential challenges from market conditions and ongoing legal proceedings. The management remains committed to enhancing internal controls and addressing any identified weaknesses to ensure accurate financial reporting and compliance.