BOSTON HEIGHTS, Ohio — While it couldn’t match its pace from a year ago, Top 100 retailer Arhaus its top and bottom line outlook for the first quarter of Fiscal 2024.
The Boston Heights, Ohio-based retailer recorded net revenue of $295.16 million in the three months ended March 31, down 3.1% from $304.57 million in the first quarter of FY2023. The company attributed the decrease to the non-recurrence of prior year abnormal backlog deliveries and a weather-related impact on deliveries in January, partially offset by favorable demand vs. prior year.
Net and comprehensive income was $15.1 million, or 11 cents per diluted share, down 55.72% compared with $34.1 million, or 24 cents per diluted share, in the first quarter of 2023. Adjusted EBITDA was $29 million compared with $55 million in the first quarter of 2023, giving Arhaus an adjusted EBITDA margin of 9.9%.
When it released its projections at the end of FY2023, Arhaus anticipated first quarter net revenues of $260 million to $270 million with net income of $1 million to $3 million.
“I want to thank our teams for delivering a solid start to 2024 and executing on our key priorities,” said John Reed, co-founder and CEO. “We are pleased to have exceeded our top and bottom line outlook for the quarter as the Arhaus team executed well, and first quarter benefited from the shift in our new warehouse management system implementation to April from March.
“We are building on our track record of industry-leading market share gains with demand comparable growth of 1.3% in the first quarter,” he continued. “January’s weather-impacted high-single-digit demand comparable decline was more than offset by demand comparable growth of mid-single-digit and high-single-digit in February and March, respectively. We also continued our strategic investments in systems, e-commerce capabilities and our in-home designer and trade programs during the quarter.”
With those numbers in hand, Arhaus reaffirmed its 2024 outlook, with net revenue in the range of $1.33 billion to $1.37 billion, net and comprehensive income of $95 million to $105 million, and adjusted EBITDA of $185 million to $200 million.
In 2024, Arhaus plans to open nine to 11 showrooms, as well as renovate, relocate and expand several locations.
“We are thrilled with client response to the new product introductions we have made this year,” said Reed, “and are excited to be opening several new showrooms in the second quarter, including in new markets, as we capitalize on our tremendous brand awareness opportunity and remain keenly focused on strategic growth. We are on track to deliver on our goals for the year and are reaffirming our 2024 full year financial outlook.”