Michaels swings to Q2 loss on costs; 21 new stores on tap
Irving, Texas – The Michaels Companies Inc. on Wednesday reported a net loss of $48 million in the second quarter of fiscal 2014, compared to net income of $17 million in the year-ago period, as $68 million in costs associated with debt-extinguishment and drove the retailer into the red. Its results, however, beat analysts estimates, and the company raised its full-year outlook. It was Michaels’ first earnings report since it went public again at the end of June.
Net sales for the quarter, ended Aug. 2, increased a better-than-expected 4.9% to $948 million, from $904 million last year. Same-store sales increased by 3.2%.
The retailer plans to open 21 new Michaels stores in the second half of 2014, and expects total annual sales growth of 1% to 2% for the fiscal year.
“We are in the implementation phase of our multi-year strategic plan which is designed to not only improve the experience of our core enthusiast shopper but also to attract the under-served novice customer to Michaels, enabling us to further extend our leadership position within the fragmented arts and crafts industry," Chuck Rubin, CEO, said. "We enter the back half of 2014 confident in our business, our outlook and our initiatives.
Tiffany Q2 profit and sales top estimates; to open 10 stores
New York – Profit and revenue for Tiffany & Co. exceeded Wall Street predictions during the second quarter of fiscal 2014. Net earnings rose 16% to $124 million from $107 million in the second quarter of the previous fiscal year, which the retailer attributed to worldwide net sales growth and gross margin improvements.
Worldwide net sales increased 7% to $992.9 million, from $925.9 million. Strong performance in the colored diamond and statement jewelry categories helped drive sales.
During the rest of the fiscal year, Tiffany plans to open 10 company-operated stores and close three existing stores: opening four in the Americas, two in Asia-Pacific, two in Japan, and one each in Europe and Russia, while closing one each in the Americas, Asia-Pacific and the United Arab Emirates. Tiffany also increased its net earnings forecast for the fiscal year and expects worldwide net sales growth.
Chico’s Q2 profit disappoints amid price cuts
Fort Myers, Fla. – Chico’s FAS Inc. reported net income of $30.1 million in the second quarter of fiscal 2014, down 31% from $43.6 million in the year-ago period. Price cuts needed to clear seasonal merchandise were a primary driver of Chico’s lower net income. Its results missed Wall Street expectations.
Net sales for the quarter ended August 2, 2014, were $671.1 million, up 3.3% from $649.5 million in the previous year, primarily reflecting the addition of 98 net new stores.
Total same-store sales rose 0.3%.