Tax benefit boosts 99 Cents Only profit in Q1
City of Commerce, Calif. — 99 Cents Only Stores LLC reported net income of $9.57 million in the first quarter of fiscal 2015, up from $897,000 in the same quarter a year earlier.
Net sales rose $477.9 million, up 7% from $445.2 million in the first quarter of fiscal 2014.
"We have been pleased with the substantial progress made on implementation of our strategic plan during the quarter," stated Stephane Gonthier, CEO of 99 Cents Only. "Although our comp sales were impacted by the timing of this year’s Easter holiday and lower availability of fresh produce as a result of the drought conditions in California, we continue to be excited about the sales and margin opportunities available in the near- to medium-term through direct sourcing and our initiative to raise shelf heights across the chain."
Minimum wage bill filed in Mass.
Boston — A joint committee of the Massachusetts state House of Representatives and Senate has filed a bill to gradually raise the state’s minimum wage from its current hourly rate of $8 to $11. The increase would occur in stages until reaching $11 in 2017.
The House of Representatives previously filed a bill that would raise Massachusetts’ minimum wage to $10.50 by 2016. The Senate previously approved a different bill that would raise the minimum wage to $11 by 2017 and also tie future increases to inflation. The current compromise bill does not include inflationary adjustments.
The hottest company in home furnishings
With an 18% same store sales increase and a 217% profit improvement in the first quarter no wonder Restoration Hardware is looking to add 31 new stores to its 69 current locations.
The company is on track to open stores in Los Angeles and Atlanta later this year and is adding two floors to its top-performing store in New York. In addition, Restoration Hardware chairman and CEO Gary Friedman said the company has signed leases for six of its stores called “next-generation full line design galleries,” and is in negotiations for 25 additional locations.
Details of the company’s robust expansion plans were shared as part of a first quarter earnings announcement that saw same store sales increase 18% on top of a 39% increase the prior year. Revenues increased 22% to $366.3 million and profits increased 217% to $7.2 million.
“(Restoration Hardware) continued to outperform the home furnishings industry by a wide margin in the first quarter of 2014,” Friedman said. “The business momentum and strong trends we are seeing thus far in 2014 give us further confidence in our financial outlook for the year. We are increasing our net revenue guidance for 2014 to grow in the range of 20% to 22%, and expect adjusted net income to grow in the range of 33% to 37%.”
Looking ahead, Friedman said the company remains focused on key value-driving strategies such as the expansion of its product offering and the transformation of retail stores. Once the company’s real estate transformation is complete Friedman said the company will produce annual sales of $4 billion to $5 billion, generate mid-teens operating margins and significant free cash flow.