After hitting a record high of $204.6 million in the fiscal year ended February 28, 2021, revenue at Educational Development Corp. fell 30.3% in fiscal 2022, dropping to $142.2 million. Net earnings declined 34.1%, to $8.3 million.
The decline came in EDC’s home sales division, which had seen a surge in sales during the pandemic as parents looked for books that could both entertain and educate their children when schools were closed. The lockdowns also drove up the number of sales reps who could work from their homes. With schools reopening and lockdown’s easing, sales in the home division plunged 34.2%, to $129.0 million, in fiscal year 2022, compared with net revenues of $196.0 million in fiscal 2021. The average number of active consultants in fiscal year 2022 was 44,900, a decrease of 7.8%.
Unlike the home sales unit, EDC’s much smaller publishing division had a good fiscal 2022, with sales jumping 54.7%, to a record $13.3 million. The company attributed the gain to the reopening of retail stores.
As EDC works to regain its footing, president and CEO Craig White acknowledged that the company is facing a new challenge: inflation. Higher prices for such things as gas and food cause have resulted in customers having less disposable income—something, White said, that has had “a short-term impact on sales.” On the flip side, higher costs often lead to an increase in home sales reps, as people are looking for new earning streams. Still, White said, given the current trends, EDC is looking at the current fiscal year “with a more conservative outlook.” He added: “While we expect short term challenges this year, we are taking steps to conserve cash and maintain profitability.”