New York, Saks Inc., said Tuesday that its third-quarter profits rose more than threefold, helped by strong demand for its updated merchandise.
Net profit reached $21.6 million for the fiscal third quarter ended Nov. 3, compared with $6.2 million a year earlier. Sales also increased by 14% to $796.1 million.
Same-store sales increased by 11.4%, “exceeding the company's expectations,” CEO Stephen Sadove said in a statement.
“A more challenging promotional and overall macro economic environment pressured merchandise margins was offset by the impact of unredeemed gift cards. This produced a flat gross margin rate,” Sadove said.
Saks forecasts high single-digit percentage growth in same-store sales for the quarter. The company still expects "outsized" same-store sales in November and "below-average" sales in December.
It also continues to expect to hit an operating margin of about 4% for the full year, and the company added that it could reach 8% over the next three years.
Another department store operator did not fare so well. Little Rock, Ark.-based Dillard’s Inc. reported a net loss of $11.3 million for the 13 weeks ended Nov. 3, compared to a profit off $13.6 million a year ago.
The company’s sales fell to $1.63 billion from $1.72 billion, and same-store sales declined 6%.