Textiles a Q1 hit at Tuesday Morning
HTT Staff -- Home Textiles Today, 10/25/2011 8:11:08 AM
Dallas - Home textiles provided a bright spot in a dismal quarter at Tuesday Morning spurred by the recent dip in cotton costs.
"With the decline in cotton pricing, we have seen favorable margins in terms of textiles," explained Kathleen Mason, president and ceo, during the 853-unit closeout chain quarterly conference call yesterday afternoon.
Added Michael Marchetti, evp, coo: "We bought a year ago, and we've been selling it throughout the past year, so we've already realized the benefit."
"It has virtually all sold through," said Stephanie Bowman, evp, cfo.
Mason singled out home textiles as "one of the opportunities that we had to purchase, and a sizeable quantity which accounted for an uptick in inventory - textiles across all categories because of the cotton prices. So we were able to maintain very favorable pricing in textiles and maintain our price position in textiles without raising prices as others have had to do."
Otherwise, the first quarter, ended Sept. 30, resulted in a net loss, which swelled to $5.7 million, or a 13 cent loss per share, compared to a net loss of $2.6 million, or a 6 cent loss per share, for the same period last year.
Sales, which declined a modest 1.2% to $170.7 million, while comps fell 4.1%. Traffic dropped by 5.2%, slightly offset by a 1.1% increase in average ticket.
Looking to improve its performance, Mason said Tuesday Morning is "concentrated on our monthly event mailer, our internet business and our real estate strategy of continued store relocations and replacements. As we move from testing the mailer and internet initiatives, to implementing them in the back half of our fiscal year, we expect to begin to realize their impact on our business."
Looking ahead, Tuesday Morning said it is maintaining its most recent guidance for the full fiscal year ending June 30, 2012, based on its first quarter results. Net sales are expected to be in the range of $828 million to $834 million; comparable store sales are expected to be in the negative low single digits; and earnings per share are expected to be in the range of 22 to 26 cents.
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