The Consumer Confidence Index rose a larger-than-expected 3.8 percentage points, but still ended up a little lower than expected due to a downward revision to the previous month's data. Both the present situation and expectations series improved during the month, with the present situation series up 7.5 points to 56.2. This marks the largest one-month gain since February 2012 and brought the index to its highest level since September 2008. Most of the improvement in the present situation series came from better perceptions of the labor market, where the percentage of households reporting that jobs were plentiful rose 2.2 points to 10.3 percent. Perceptions about overall business conditions improved less dramatically, with the share reporting that current business conditions are good rising 1.2 percentage points to 16.5 percent and those reporting conditions are bad falling 0.7 percentage points to 33.1 percent.

By Bloomberg News

Restoration Hardware Holdings Inc. (RH) is betting investors will be willing to pay a 60 percent premium to buy shares in its initial public offering as the home-furnishing retailer's profits surge and the housing market recovers.

The Corte Madera, California-based company and shareholders are seeking as much as $123.9 million in the sale today, offering 5.2 million shares for $22 to $24 each, according to regulatory filings. The midpoint values Restoration Hardware at $850.3 million, or 26 times net income in the 12 months through July, data compiled by Bloomberg show. That's almost two-thirds more than the average of 16 for home retailers Williams-Sonoma Inc. (WSM), Ethan Allen Interiors Inc. (ETH) and Bed Bath & Beyond Inc. (BBBY)

Restoration Hardware, the seller of leather couches and tables made of salvaged wood, increased net income more than six-fold in the 12 months through July by closing stores and selling more online and through catalogs. Now the company is positioned to benefit from continued sales growth as U.S. housing starts climb to the highest level in four years, according to Ipox Schuster LLC's Josef Schuster.

"That's where the offering comes in, to capture the imagination of continued positive momentum in the U.S. housing market," Schuster, founder of the Chicago-based firm that oversees about $2 billion, said in a phone interview. "There's definitely money out there for this kind of deal."

The shares being offered represent a 14 percent stake in Restoration Hardware, regulatory filings show. The company is offering 4.8 million of the shares in the sale, while management and other holders are selling about 382,000 shares.

Net income at Restoration Hardware jumped in the 12 months through July to $33.1 million compared with $4.9 million a year earlier, according to filings. Sales increased 22 percent in the same period to $1.05 billion.

The company reduced its number of stores to 74 from 95 in the two years through January, reversing a $28.7 million annual net loss to $20.6 million of profit, regulatory filings show. Revenue from direct-to-consumer sales increased to 46 percent of sales in the last 12 months compared with 39 percent in the year through January 2010, according to the filings.

The housing recovery and improving consumer sentiment will fuel demand for furniture and help propel further profit growth at Restoration Hardware, according to Ipox's Schuster.

Housing starts in the U.S. surged 15 percent in September to the highest level in four years, adding to signs of a revival in the industry at the heart of the financial crisis. Consumer confidence rose to a five-year high in October, an economic report showed last week, suggesting that the real-estate revival is bolstering household finances and will help sustain gains in spending.

Including net debt, the midpoint of the offering range values Restoration Hardware at $903.6 million including net debt, or about 13 times earnings before interest, taxes, depreciation and amortization of $67.5 million in the 12-month period, filings show. That's also higher than Williams-Sonoma, Ethan Allen and Bed Bath, which have an average enterprise value-to-Ebitda ratio of 9.3 times for comparable periods, data compiled by Bloomberg show.

The company also cites an adjusted Ebitda of $87.3 million in the same period that excludes one-time charges for things such as non-cash compensation and the $2 million cost of an investigation into a personal relationship between former co- Chief Executive Officer Gary Friedman and an employee, according to filings.

GreatCo Introduces Gallery Electric Fireplaces

An experienced fireplace team is back in the business with an all-new line-up of electric fireplaces. These fireplaces have brilliant flames, are low cost to operate (less than a penny per hour) and have the latest in technology.   

These stunning new linear models are hitting the market in November, with the built-in models to follow in December. The Gallery Electrics are branded under GreatCo, a new division of The Outdoor GreatRoom Company (OGC).



According to the company, OGC has had market-leading results for Outdoor Rooms and significant success with outdoor gas burners and firepit tables. Recognizing a growing demand for linear gas fireplaces, OGC has had recent success with the award-winning Key Largo gas firepit table. This success and market interest led to the introduction of The Gallery Linear Electric Fireplaces. They are designed to meet a popular trend in today's indoor hearth industry - linear, sleek, modern designs.

As stated by Dan Shimek, president of OGC, "Our goal is to develop high-quality products that are responsive to consumers' interests. Our Key Largo Fire Pit's sleek linear design was well received and helped us to achieve a similar design for an indoor fire application--the Gallery Electric Linear Fireplaces. Our team has more than 100 years combined experience in the hearth industry and we excited about being more directly back in the business we know."



All Gallery Electric fireplaces operate quietly using Silent Force Technology. It provides quiet operation and solves a problem that may have accompanied many earlier electric designs. All models have LED lighting - what OGC refers to as Low Energy Demand because it allows the fires and lighting to operate very efficiently. In fact, the cost to operate both the fireplace and the backlighting for a typical consumer is less than one penny per hour (the heating element can operate for less than 10 cents per hour).

The five linear models range in price from $699 to $2,200 and range in width from 36 to 94 in. Each includes a remote control that operates four unique flame settings, a two-speed heater, 13 back-lighting colors, a thermostat and a timer. The heater nicely warms a room and has a thermostatic control that can be turned on and off remotely. The wall models are easy to install (like a picture frame with a plug in) and cool to look at - and to touch.