EACO Corporation Reports 17% Revenue Growth and Significant Net Income Increase

EACO Corporation reported significant financial growth in its latest quarterly results, with net income for the three months ended November 30, 2024, reaching $6.9 million, a substantial increase from $1.8 million in the same period last year. This translates to earnings per share of $1.41, compared to $0.36 in the prior year. The company’s total comprehensive income also rose to $6.9 million from $1.6 million, reflecting a strong performance driven by increased sales and improved operational efficiency.

The company’s revenue for the quarter was $93.9 million, marking a 17% increase from $80.3 million in the previous year. This growth was attributed to the addition of 13 sales employees, which enhanced customer acquisition and product sales. EACO's gross margin remained stable at approximately 29.6%, slightly up from 29.4% in the prior year, indicating effective cost management alongside revenue growth. Operating expenses decreased by 10.3% to $18.9 million, primarily due to the absence of a significant impairment charge that had impacted the previous year’s results.

EACO has also made strategic moves to bolster its operational capabilities. The company completed the purchase of its corporate headquarters in Anaheim, California, for $31 million in October 2023, which is expected to enhance its operational efficiency. The acquisition was financed through available cash and marketable securities, which increased to $20.5 million from $14.7 million over the same period. The company’s total assets grew to $198.8 million, up from $188.5 million, reflecting a solid balance sheet position.

In terms of operational metrics, EACO's employee count rose to 605 from 577 year-over-year, supporting its expanded sales efforts. The company reported a net cash provided by operating activities of $2.0 million, a significant increase from $301,000 in the prior year, driven by higher net income and an increase in trade accounts payable. However, cash used in investing activities decreased to $5.7 million from $8.9 million, primarily due to the previous year’s purchase of the Hunter Property.

Looking ahead, EACO remains optimistic about its growth trajectory, citing increased demand for its products and a strengthened sales force. The company is also focused on addressing a material weakness in its internal controls over financial reporting, which it is actively working to remediate. EACO anticipates that its strategic investments and operational improvements will continue to drive revenue growth and enhance profitability in the upcoming quarters.