Destination Maternity sales rise 3% in Q2 FY'12

06 Apr '12

5 min read

Destination Maternity Corporation, the world's leading maternity apparel retailer, reported sales and provided updated earnings guidance for the second quarter of fiscal 2012 ended March 31, 2012.

Net sales for the second quarter of fiscal 2012 increased 3.0% to $137.8 million from $133.8 million reported for the second quarter of fiscal 2011. Comparable sales (which include Internet sales) increased 3.2% versus a comparable sales increase of 0.3% for the second quarter of fiscal 2011.

The increase in total reported sales for the second quarter of fiscal 2012 compared to the second quarter of fiscal 2011 resulted primarily from the increase in comparable sales and increased sales due to the expansion of the Company's maternity apparel leased department relationship with Macy's, partially offset by decreased sales related to the Company's continued efforts to close underperforming stores, and, to a much lesser extent, a decrease in sales due to the closure of all of the Company's remaining leased departments within Kmart stores during the month of October 2011.

Net sales for the first six months of fiscal 2012 increased 1.8% to $274.2 million from $269.3 million reported for the first six months of fiscal 2011. Comparable sales decreased 0.6% versus a comparable sales increase of 1.5% for the first six months of fiscal 2011.

The increase in total reported sales for the first six months of fiscal 2012 compared to the first six months of fiscal 2011 resulted primarily from increased sales due to the expansion of the Company's maternity apparel leased department relationship with Macy's, partially offset by decreased sales related to the Company's continued efforts to close underperforming stores, and, to a much lesser extent, a decrease in sales due to the closure of all of the Company's remaining leased departments within Kmart stores during the month of October 2011 and the decrease in comparable sales.

Ed Krell, Chief Executive Officer of Destination Maternity, noted, "We are pleased to report that our sales for the second quarter of fiscal 2012 were stronger than planned, reflecting strong sales results for our Spring and Summer 2012 product lines and the positive sales impact of price promotional activity and additional markdowns taken on Fall and Winter product, primarily in the first two months of the quarter, to spur sales and manage inventory.

Thus, for the quarter, our sales were slightly above the top end of our sales guidance range. With these sales results and our continued tight management of expenses, we expect our earnings for the second quarter to be higher than the top end of our prior earnings guidance range. Our prior earnings guidance range for second quarter GAAP diluted earnings per share, as provided in our January 26, 2012 press release, was $0.21 to $0.31 per share.”

"Our total sales of $137.8 million for the second quarter was slightly above the top end of our sales guidance range of $133 to $137 million provided in our January 26 press release, and our comparable sales increase of 3.2% was slightly above our guidance range of between a decrease of 1% to an increase of 3% for the quarter. It is important to note that our reported comparable sales results for the second quarter of fiscal 2012 benefited by approximately 2.5 percentage points due to:

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