Thank you for joining the Educational Development Corporation's first quarter earnings call. Before beginning the call, we would like to remind you that some of the statements made today will be forward-looking and are protected under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those expressed or implied due to a variety of factors. We refer you to Educational Development Corporation's recent filings with the SEC for a more detailed discussion of the company's financial condition. With that, I would like to turn the call over to Craig White, the company's President and Chief Executive Officer.
Thank you, Justin. Thank you, and welcome everyone to the call. With me today are Randall White, our Executive Chairman of the Board, Heather Cobb, Chief Sales and Marketing Officer, and Dan O'Keefe, our Chief Financial Officer. Some points I'd like to start off with. As much as we hate to keep pointing this out, our, you know, first quarter sequential comparisons remain difficult. Quarter one last year had tailwinds continuing from the pandemic, including retail stores reopening, record levels of active consultants, and continued school disruptions. Quarter one this year was impacted additionally by headwinds primarily tied to the overall economy, such as the war in Ukraine, record inflation resulting in double-digit fuel and food price increases, and employees returning to work back in the office.
While we continue to manage through the impacts and changes created from the pandemic and these other global-related headwinds, I'm proud of our ability to remain profitable and to see the resiliency of our team, our employees, to manage through these tumultuous times. We will expand on Q1 further in the call, and I will walk you through the recent announcement in regards to our publishing distribution agreement announced in May of this year. With that, I will now turn the call over to Dan O'Keefe, our Chief Financial Officer, to provide a brief overview of the financials for our first quarter of fiscal 2023.
Thank you, Craig. Our first quarter highlights include net revenues for the first quarter totaled $23.2 million, a decrease of $17.6 million or 43.1% compared to $40.8 million reported in the first quarter of fiscal 2022. Earnings before income taxes for the first quarter totaled $300 thousand, a decrease of $4.4 million or 93.6% compared to $4.7 million reported in the first quarter last year. Net earnings totaled $200 thousand compared to $3.4 million, a decrease of $3.2 million or 94.1% from last year. Earnings per share on a fully diluted basis totaled $0.03 compared to $0.41, down 92.7% on a fully diluted basis from last year. Some balance sheet highlights.
As we mentioned in the last earnings call, inventory levels peaked at the beginning of this fiscal year at approximately $17.6 million and reduced slightly to $71.6 million by the end of the first quarter. We continue to expect inventory to reduce in future quarters as we normalize our volumes to match current sales volumes. We expect to see the biggest change in inventory in the fiscal third quarter when our sales are the highest. Cash flow generated from inventory sales will be used to reduce our working capital line of credit. That concludes the financial report, and now I'll turn the call over back to Craig.
Thanks, Dan. As I mentioned previously, our business is continually facing headwinds or tailwinds, depending on both the change in discretionary cash flow of our customers and the change in unemployment or inflation impacting our consultant network. Fortunately, we can capitalize on tailwinds and adjust our sales and costs in challenging periods like we are now, when consumer discretionary spending is declining. We are not sitting idle watching the impact of the market. We are constantly changing our marketing and sales strategy to maximize our opportunity. To further talk about sales opportunities, I'll pass the call over to our Chief Sales and Marketing Officer, Heather Cobb.
Thanks, Craig. I just want to talk a little bit about some recent sales and marketing specials that we have done and some of the things that we are currently doing. In May, we offered double points for our incentive trip contest, which we actually launched on May 1st. That promotion itself resulted in an uptick in May sales. May and June, we offered a variety of different discount opportunities on various books to draw attention from consultants as well as customers. This July, we have been running promotions, including a free shipping promotion opportunity on our e-commerce site, which began on Monday and is running through the end of the week. A few weeks ago, we had our national convention here in Tulsa. It was our first live convention event in three years.
We did a hybrid version of convention this year. The last two years, we've done a fully virtual event. This year we were able to host over 3,000 people attending both live and some from at home. We believe that this was the best event we've ever had. We've had great response back not only from those who attended, but also with the various vendors that we worked with on the event. We announced during convention that we were running a fabulous recruiting special to generate interest in joining the team. We've currently had over 3,000 new recruits to date with that special that started in mid-June. It is running through July 15th, and we're excited to see how many more we will be adding.
In addition, July and even in the coming months, we have more promotions that will be announced at a later date, both targeted towards customers and consultants. High inflationary periods usually precede a growth in active consultants as more families are looking for supplemental income to offset an increase on living costs. We are working to try to capitalize on that opportunity, because more recruits coming in the door helps increase those sales opportunities that come later, especially going into the fall. That concludes our sales and recruiting update, and I will turn the call back over to Craig once again.
Thanks, Heather. As Dan mentioned, we are continuing to strengthen our balance sheet. As our inventory turns into cash, we will use this cash to first pay down our working capital line, and then we will look to utilize additional cash flow to reinstate investor dividends. Additionally, I've said over the last several calls that I'm wanting to look to expand, to get into educational toys, games, and puzzles. We've been talking with a few vendors that want to create exclusive content for us. It's early on in that process. We've seen a few samples. We've seen second revisions of presentations, but this would be looking for, you know, fiscal 2024 or calendar 2023. We are aggressively looking at additional projects and products.
As Heather mentioned, our sales and marketing team is making exciting changes, lots of new ideas to promote our products and excite our sales force during inflationary periods. Of course, we're looking to grow our active consultant count. We're also excited to see rebounding sales from sales channels that were negatively impacted by the pandemic, including school book fairs, booths, fairs, and school and vendor shows. These two channels have taken a positive turn back toward pre-pandemic levels. Lastly, I wanna make a couple of comments about our recent Usborne agreement. The new agreement is long overdue and replaces many outdated agreements. Our new agreement does not change our 40-plus-year relationship, and we are committed to Usborne Publishing, who produces some of the best children's books in the world, and they are committed to our multi-level marketing division.
There are some changes we are still working through, but we continue to support each other during these leadership transitions of both of our companies. Now that we have provided a summary of some recent activity, I will open the call up to questions from our investors. Justin, if you could, open that up for us.
Thank you. If you would like to signal with questions, please press star one on your touch tone telephone. If you're joining today using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. You'll hear a tone indicating when your line is open. At that point, if you would please state your name and company name and pose your questions. Again, that is star one if you would like to signal with questions, star one. At this time, there are no questions, but I would like to remind our audience again, please press star one if you would like to ask questions. Again, that is star one.
Justin, I might make another comment also. We are trying to get our schedule down on our 8-K filings and our press release and announcing this call. We've been working over the last several quarters to streamline it so that the call is not a full day after our press release and 8-K. I think we probably did not announce this call, but until about an hour ago. That's probably not great form on our part, and we'll work on making that better for next quarter.
Again, that is star one if you would like to ask questions, star one. There are no questions at this time, sir.
All right. I'll make some closing statements then. While the first quarter is not what we hoped to be, it's still being impacted by factors outside of our control, be it the world economy, inflation, recession, rising costs. There's been many things in the last month or two that give us great hope for the future. Our convention was a huge success. We've got many promotions that are working very well, and we'll continue to do that. With our number, well, one and two are kind of tied together. We need to increase our head count, but most importantly, we're trying to increase our sales so that we can reduce our inventory. It's gonna take us another couple quarters to get us back to right-sized inventory levels, and then we should be smooth sailing from then on. Thank you.
I appreciate everyone being on the call.
Thank you. That does conclude today's conference. We do thank you for your participation. Have an excellent day.