Gottschalks puts quarter in bank
By Staff -- Home Textiles Today, 8/30/2004
FRESNO, CALIF. — Putting behind it store-closing costs that dogged the bottom line a year ago, Gottschalks Inc. recorded a second quarter profit of $350,000, up from $25,000 the prior year.
The second quarter has historically run at a loss, and Jim Famalette, president and CEO, said despite a dip in sales, "our bottom line net results were the best for a second quarter in more than 15 years."
Sales in the period slipped 1.3 percent, to $147.8 million from $149.8 million last year. Same-store sales declined 1.3 percent.
Average gross margin thinned 30 basis points, or three-tenths of a percentage point, to 35.4 percent from 35.7 percent a year ago. "Our gross margin was somewhat impacted by lower sales, as we continued to implement a markdown strategy focused on maintaining strong inventory controls."
"However, as part of our effort to improve our merchandise flow, through better planning and allocation, we ended the quarter with nearly 3 percent less inventory on a comparable basis and continued to improve our inventory turn," he added.
Operating costs climbed 60 basis points, or six-tenths of a percentage point, to 32.8 percent of sales from 32.2 percent the preceding year.
| Qtr. 7/31 (x000) | 2004 | 2003 | % chg |
| Sales | $147,776 | $149,757 | -1.3 |
| Oper. Income (EBIT) | 5,237 | 6,522 | -19.7 |
| Net income | 350a | 25a | — |
| Per share (diluted) | 0.03 | 0.00 | — |
| Average gross margin | 35.4% | 35.7% | — |
| SG&A expenses | 32.8% | 32.2% | — |
| Six months | 2004 | 2003 | % chg |
| Sales | 292,309 | 287,672 | 1.6 |
| Oper. Income (EBIT) | 7,301 | 7,196 | 1.5 |
| Net income | (1,759)b | (3,961)b | — |
| Per share (diluted) | (0.14) | (0.31) | — |
| Average gross margin | 34.9% | 34.8% | — |
| SG&A expenses | 33.4% | 3.5% | --- |
| (loss) | |||
| a-Second quarter results include miscellaneous income of $465,000 versus $683,000 last year. The prior-year second quarter includes a $307,000 loss from discontinued operations. | |||
| b-Six-month results include $927,000 in miscellaneous income versus $1.1 million a year ago; an income-tax benefit of $1.1 million versus $1.9 million a year ago; a $1.7 million loss from continuing operations versus $1.9 million last year; and a $20,000 loss from discontinued operations versus a $731,000 prior-year loss. | |||
