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The Container Store Q4 net income skyrockets 800%

BY Dan Berthiaume

Coppell, Texas – The Container Store increased net income by about 800% year-over-year during the fourth quarter of fiscal 2013, to $18.34 million from $2.09 million. A substantial drop in effective tax rate, as well as lower net interest expense, helped drive the impressive growth in net income.

Net sales slipped from $217.02 million to $216.82 million, while same-store sales climbed 1.4%. The company cited severe weather as reducing sales.

The Container Store plans to open six new stores in fiscal 2014, including locations in Cranston, R.I. (May 17), a relocated store in Oak Brook, Ill. (June 28), Los Angeles (Aug. 9), Murray, Utah (Oct. 18), Chicago (Nov. 15), and another site to be determined.

During 2014, The Container Store is expanding two new customer programs. Its POP! (Perfectly Organized Perks) customer engagement program, currently testing in California stores, that rewards customers with special communication, gifts and exclusive offers will roll out to all stores by the end of July. Additionally its AtHome personalized design and organization service, currently testing in select Texas stores, where expert organizers go directly into customers’ homes and design solutions for them, will launch in additional markets in Texas, as well as key markets such as Manhattan and Los Angeles.

In the full fiscal year 2013, The Container Store swung to a profit of $8.17 million from a net loss of $130 million. Net sales rose 6% to $217.02 million, from $216.82 million. Same-store sales improved 2.9%.

For fiscal 2014, consolidated net sales are expected to be $827 to $837 million, based on our announced store openings and an increase in comparable store sales of 3% to 4%. Net income is expected to be $0.56 to $0.61 per diluted common share.

“We’re a solutions-based, not items-based form of retail,” said Container Store chairman and CEO Kip Tindell. “And when you’re selling solutions made up of exclusive proprietary products that you simply can’t find anywhere else, it helps to insulate you from competition, including the giant Internet retailers. Consumers can’t ‘showroom’ us because you simply can’t ‘showroom’ exclusive or proprietary products and you can’t ‘showroom’ solutions.”

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Michael’s Stores net income soars in Q4

BY Dan Berthiaume

Irving, Texas – Net income at Michael’s Stores Inc. soared 36% to $143 million in the fourth quarter of fiscal 2013 from $105 million in the same quarter the previous year. Net sales grew 2% to $1.55 billion from $1.52 billion and same-store sales rose 4.2%.

Michael’s credited a 53rd week in fiscal 2013, as well as increases in average ticket size and transactions, as driving its fourth quarter performance.

During the full fiscal year, net income increased 32% to $264 million from $200 million. Net sales improved 3.7% to $4.57 billion from $4.41 billion, and same-store sales increased 2.9%.

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Study: Corporate data breaches damage sales

BY Dan Berthiaume

San Francisco – Consumers avoid doing business with a breached organization at a high rate. According to a new study conducted by Javelin Strategy & Research and commissioned by data management solution provider, Identity Finder, 33% of customers will shop elsewhere if their retailer of choice is breached.

However, the study shows only 30% of retailer offer breach victims protection. To protect and manage sensitive data from breaches and subsequent misuse, Javelin recommends ongoing risk assessments. For these assessments to be successful, businesses should proactively create an internal sensitive data management initiative tailored to each organization encompassing the five steps of sifting through irrelevant data and discover sensitive information, classifying information and assign accountability to clean and protect, securing and remediating unprotected files / removing at-risk data, centrally monitoring policies, actions, and good behavior going forward, and reporting compliance with policy and regulation

"A significant proportion of affected consumers discontinue or reduce their patronage post-breach," said Al Pascual, senior analyst of security, risk and fraud at Javelin Strategy & Research. "That’s real money lost in customer churn and reduced sales, and certainly demonstrates how the reputation of the organization hits the bottom line.”

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