bebe stores inc announced unaudited financial results for the first quarter ended October 1, 2011.
Net sales from continuing operations for the first quarter of fiscal 2012 were $126.3 million, up 9.5% from $115.3 million reported for the first quarter a year ago. As previously reported, comparable store sales for the quarter ended October 1, 2011 increased 7.0% compared to a decrease of 4.7% in the comparable period of the prior year.
Gross margin from continuing operations as a percentage of net sales decreased to 40.0% in the first quarter of fiscal 2012, compared to 40.5% in the first quarter of fiscal 2011. The decrease in gross margin as a percentage of net sales was primarily due a decrease in initial mark-up and increases in inventory reserves and write-offs, offset by positive occupancy leverage.
The decrease in gross margin continues to be driven by higher raw material and production costs, as well as the increase in 2b sales and international wholesale sales which are at a lower gross margin.
SG&A expenses from continuing operations were $47.0 million, or 37.3% of net sales, compared to $46.3 million, or 40.2% of net sales for the same period in the prior year.
The effective tax rate from continuing operations for the first quarter of fiscal 2012 was 37.2% compared to 42.3% in the first quarter of fiscal 2011. The lower tax rate in the current year first quarter was primarily due to various discrete items, including a one-time credit claimed during the quarter.
Operating income from continuing operations for the first quarter of fiscal 2012 was $3.4 million, or 2.7% of net sales, compared to $0.3 million, or 0.3% of net sales, for the same period of the prior year. For the quarter, net income from continuing operations was $2.4 million or $0.03 per diluted share on 84 million shares outstanding compared to $0.3 million or $0.00 per diluted share on 85 million shares outstanding for the same period of the prior year.
Net loss from discontinued operations for the first quarter of the prior fiscal year was $1.5 million or $0.01 per diluted share on 85 million shares outstanding.
During the quarter ended October 1, 2011, the Company closed 2 bebe stores.
For the current quarter the Company's capital expenditures were approximately $4.3 million and depreciation expense was approximately $5.0 million.
For the second quarter of fiscal 2012, we currently anticipate comparable store sales in the positive mid-single digit range. Depending on actual sales and markdowns, net income from continuing operations is expected be in the range of $0.04 to $0.07 per diluted share based on 84 million weighted average shares outstanding versus net income from continuing operations of $0.02 per diluted share based on 84 million weighted average shares outstanding in the second quarter of fiscal 2011. The Company is currently anticipating an effective tax rate of approximately 41% for fiscal 2012.
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