Rockaway, N.J., Party City Corp.’ second-quarter profit fell on lower sales and higher costs for investments in merchandising and logistics, sharply missing Wall Street estimates.
For the three months ended Jan. 1, net income fell to $14.7 million, or 74? a share, down from $19.3 million, of 98? a share, a year ago. Revenue fell to $174.3 million from $182.6 million. General and administrative expenses rose to $10.7 million from $7.5 million. The company said it expects to benefit from its investments beginning in the fourth quarter.
Same-store sales at company-owned stores dropped 5.6% during the quarter, while franchise stores posted a 2.8% decline. Total chain net sales fell 3% to $356.8 million.