Of the retailers posting fourth-quarter earnings Wednesday, profits were robust — driven by solid sales of full-priced merchandise during the holidays.
Separately, Wall Street rallied on news that the Federal Reserve was leaving interest rates unchanged. The Dow Jones Industrial Average jumped 1.3 percent to 12,447.52, while the broader S&P 500 gained 1.7 percent to 1,435.04.
On the retail front, plus-size retailer Charming Shoppes Inc. delivered a 30 percent jump in fourth-quarter earnings but predicted disappointing first-quarter earnings.
For the three months ended Feb. 3, net income rose to $24.9 million, or 19 cents a diluted share, from $19.2 million, or 15 cents, in the year-ago period as sales for the quarter increased 9 percent to $874 million from $799.6 million. Same-store sales dropped 1 percent.
By brand, comps fell 3 percent at Lane Bryant, 1 percent at Fashion Bug and jumped 2 percent at Catherines Stores.
The company’s direct-to-consumer segment performed below plan, with sales down 4.9 percent to $148.2 million from $155.8 million.
Full-year earnings climbed 10 percent to $108.9 million, or 81 cents a diluted share, from $99.4 million, or 76 cents last year. Sales increased 11 percent to $3.07 billion from $2.76 billion.
The company expects first-quarter earnings to be between 19 and 21 cents a diluted share, which compares with 24 cents in the prior period. For the year, Charming Shoppes sees earnings in the range of 85 to 89 cents a share.
Off-price retailer Ross Stores Inc. said fourth-quarter earnings grew 31 percent, with strong gains in their home and shoe businesses.
For the three months ended Feb. 3, earnings rose to $93.1 million, or 66 cents a diluted share, from $71 million, or 49 cents, in the year prior as sales shot up 14 percent to $1.61 billion from $1.41 billion. Same-store sales increased 1 percent.
For the year, earnings rose 21 percent to $241.6 million, or $1.70 a diluted share, from $199.6 million, or $1.36, last year. Sales rose 13 percent to $5.57 billion from $4.94 billion. The company said sales during the holiday season were in line with expectations and benefited from strength in the mid-Atlantic and Southwest regions.
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Citi Trends reported a 31 percent surge in fourth-quarter earnings to $10.4 million, or 73 cents a diluted share, from $7.9 million, or 55 cents, in the year prior. Sales also increased 31 percent to $126.8 million from $96.8 million, with same-store sales climbing 1.3 percent.
For the full year, net income soared 50.4 percent to $21.4 million, or $1.51 a diluted share, from $14.2 million, or $1.08.
The company said it expects first-quarter earnings in the range of 44 to 49 cents a diluted share, and reiterated earnings guidance for 2007 of $1.73 to $1.77 a share.