Aug 17, 2010
Saks results beat on full-price selling; shares up
Aug 17, 2010
NEW YORK, Aug 17 (Reuters) - Saks Inc (SKS.N) posted better-than-expected quarterly results, helped by an uptick in luxury spending and the ability to sell more items at full price, sending its shares up 2.4 percent in premarket trading.
Saks Fifth Avenue
Saks said sales at stores open at least a year, or same-store sales, rose 4.6 percent in the the quarter.
Its Saks Fifth Avenue department stores saw strong sales for shoes, handbags, women's designer apparel and men's tailored clothing, among other categories.
However, Chief Executive Stephen Sadove cautioned that the outlook for the U.S. economy remains uncertain and that the company would continue to be conservative in how it manages inventory.
Saks reported a net loss of $32.2 million, or 21 cents per share, for its second quarter, ended July 31, compared with a loss of $54.5 million, or 39 cents a share, a year earlier.
Excluding one-time items, Saks reported a loss of 13 cents per share. On average, analysts expected a loss of 17 cents per share, according to Thomson Reuters I/B/E/S.
Saks, which operates 50 full-service Saks Fifth Avenue stores and 55 OFF 5th outlets, said same-store sales growth at its outlets was lower than the companywide average. Same-store sales for its online Saks Direct channel were up 21 percent.
Saks forecast same-store sales would rise in the "mid-single digit" percentage range for the remainder of its fiscal year, outpacing a "low-to-mid single digit" increase in same-store inventory levels.
Overall second-quarter sales were up 5.1 percent to $593.1 million, ahead of the $585.2 million expected by analysts. Gross margins rose 7 percentage points from a year earlier to 37.3 percent as tighter inventory levels reduced the need for price markdowns.
Saks forecast continued improvement in its gross margin rates, saying they would hit 39 percent in the second half of its fiscal year.
(Reporting by Phil Wahba; Editing by Derek Caney and John Wallace)
© Thomson Reuters 2021 All rights reserved.