FINANCE

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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FINANCE

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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OPERATIONS

Lowe’s brings Porch.com to all stores

BY Dan Berthiaume

Mooresville, N.C. – Lowe’s and Porch.com have expanded their strategic partnership to the more than 1,700 Lowe’s home improvement stores across the U.S. Every Lowe’s store in the country now features Porch as the in-store resource to help homeowners find home improvement professionals for nearly any project outside of Lowe’s current installation services.

In addition, home improvement service professionals can sign up for a free Porch profile. If a Lowe’s customer needs a professional for a service Lowe’s does not currently offer, such as handyman, painting or landscaping services, employees can access the Porch network of professionals on their mobile devices and in-store terminals to identify local providers. The service was first introduced at Lowe’s stores in the Carolinas and Seattle area in January 2014.

"While we have already been able to help our customers with projects like installing flooring or remodeling a kitchen, our partnership with Porch means we can now guide customers to find help for nearly any home improvement service, from routine maintenance to dream projects," said Jay Rebello, VP new business development and corporate innovation at Lowe’s. "Homeowners trust Lowe’s products and project expertise, and now that relationship can extend to the search for home improvement pros by providing a highly personal, localized experience through Porch."

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