Destination Maternity net income rise, sales drop in Q1

Philadelphia – Destination Maternity reported improved net income but lower net sales during the first quarter of fiscal 2014 as compared to the same period a year earlier. Net income totaled $4.25 million, up 11% from $3.84 million the same period a year earlier.

However, net sales dipped slightly from $135.3 million to $134.8 million. Destination Maternity said the slight decrease in sales for the first quarter of fiscal 2014 compared to fiscal 2013 resulted primarily from decreased sales related to the company's continued efforts to close underperforming stores, substantially offset by a 0.7% increase in same-store sales. The net sales of $134.8 million for the first quarter were slightly below the low end of the company's guidance range of $135 to $139 million provided in November 2013.

Looking ahead, Destination Maternity forecasts net sales in the $539 million to $550 million range, representing a projected sales change of between a decrease of 0.2% and an increase of 1.8%, compared to fiscal 2013 net sales of $540.3 million. This sales guidance range is based on a projected same-store sales increase of between 1% and 3%

“Our sales for the quarter were somewhat weaker than planned, reflecting the continued challenging overall economic environment which affected many retailers in the recent holiday shopping season,” said Ed Krell, CEO. “Although our sales for the quarter were slightly below the low end of our expected sales range, it represents our sixth consecutive quarter of achieving a same-store sales increase, showing the continued progress we have made with our sales initiatives, while maintaining strong operational and expense discipline.

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