Gottschalk's is back in black
By Don Hogsett -- Home Textiles Today, 3/8/2004
FRESNO, CALIF. — Swinging back to profitability from a year-before loss, Gottschalk's Inc. recorded fourth-quarter earnings of $8.4 million, compared with a year-before loss of $4.6 million. The upturn came after closing unproductive stores, paying down debt and shucking off one-time charges that acted as a drag a year ago.
Sales at the West Coast retailer improved by 1.4 percent, to $227.6 million from $224.5 million last year, while same-store sales increased by 1.6 percent.
In a prop to the bottom line, Gottschalk's grew its average gross margin by 60 basis points, or six-tenths of a percentage point, to 32.6 percent from 32 percent the prior year. At the same time, costs were whittled down by 20 basis points, or two-tenths of a percentage point, to 25.1 percent from 25.3 percent.
In a singularly big lift to earnings, Gottschalk's left behind it some of the one-time charges that generated last year's loss, specifically a $9.5 million asset-impairment charge and $1.7 million in costs tied to the sale of credit card receivables.
For all of last year, Gottschalk's recorded a profit of $1.9 million, compared with a prior-year loss of $12 million.
| Qtr. 1/31 (x000) | 2003 | 2002 | % chg |
| Sales | $227,615 | $224,513 | 1.4 |
| Oper. income (EBIT) | 19,509 | 18,542 | 5.2 |
| Net income | 8,446a | (4,565)a | -- |
| Per share (diluted) | 0.64 | (0.36) | -- |
| Average gross margin | 32.6% | 32.0% | -- |
| SG&A expenses | 25.1% | 25.3% | -- |
| 12 months | 2003 | 2002 | % chg |
| Sales | 660,574 | 665,916 | -0.8 |
| Oper. income (EBIT) | 28,492 | 28,387 | 0.4 |
| Net income | 1,870b | (111,973)b | -- |
| Per share (diluted) | 0.14 | (0.94) | -- |
| Average gross margin | 34.1% | 33.7% | -- |
| SG&A expenses | 30.9% | 31.2% | -- |
| (...) - Denotes decline a-Fourth-quarter results include a $446,000 loss on the early retirement of debt, compared with $768,000 a year ago; miscellaneous income of $446,000 vs. $768,000 a year ago; and a loss of $127,000 from discontinued operations, compared with a prior-year loss of $3.3 million. Prior-year results include a $9.5 million asset impairment charge and $1.7 million in receivables sale costs. b-12-month results include a $2.3 million loss on the early retirement of debt vs. $1.8 million in 2002; miscellaneous income of $11 million vs. $17.8 million in 2002; and a loss of $992,000 from discontinued operations, compared with a year-before loss of $4.5 million. 2002 results included a $9.5 million asset impairment charge and $1.7 million in receivables sale costs. |
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