The Buckle Inc.’s stock slid 3.4 percent to $41.40 in early trading after the retailer said in its quarterly report that comparable-store sales decreased 1.7 percent from last year. E-commerce sales, however, jumped 17.4 percent to $20.1 million over last year’s online sales.
Earnings per share for the fiscal quarter came in at 49 cents per share, which was better than the FactSet consensus of 47 cents. Net income for the second quarter of fiscal 2015 dropped to $23.5 million from $24.5 million, or 51 cents, for the same period last year. Net sales for the quarter rose to $236.1 million from $235.7 million in the prior year, but sales were lighter than the consensus of $237 million.
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Buckle saw its inventories rise in the second quarter of 2015 over last year’s inventory and blamed the increase on the shift in back-to-school. The company refused to give much more additional information regarding back-to-school on the conference call. Analysts made many attempts to get more details by asking their questions a little differently, but each time Buckle refused to give more clarity. Buckle did say that it has more guests over the age of 25, which means back-to-school doesn’t really affect that customer.
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The company has high hopes that the shift back to denim will play into Buckle’s strengths. Buckle tried to appeal to the activewear trend and had some success, but it wasn’t really their niche. Men’s denim sales were up 5 percent, but women’s denim was down 3.5 percent. Average price points for men’s denim increased, but women’s average price points decreased in denim. Stretch denim has been a good driver for sales with both men and women liking the comfort of the fabric. Destruction denim was very good. Buckle also said it was going to begin stocking more size ranges in the stores. Customers are requesting longer lengths in jeans. Men are requesting more extra-large and double extra-large tops.
The online business was good across all categories and profitable. The biggest investments the company has made in that area was to spend on promotions driving customers to the site. This also increased the size of the online purchase. Buckle wouldn’t comment on how big they thought the e-commerce business would be, but did say it would be steady growth.
Buckle is also seeing some success with its private-label brand BKE, where the company expects to see low to single-digit growth. The company has also introduced kids’ clothes in their stores and is looking for organic growth in those sales. The company has no plans to cut back on store openings with 9 new stores coming online by holiday.