Operating profit margin improves at Gordmans

13 Sep '10

5 min read

Gordmans Stores, Inc., an Omaha-based apparel and home décor retailer, announced results for second quarter (thirteen weeks) and six month period (twenty six weeks) ended July 31, 2010.

Second Quarter Highlights

• Net sales increased 14.7% to $113.1 million compared to $98.6 million in the second quarter of 2009.
• Comparable store sales increased 8.3% over the second quarter of 2009.
• Operating margin improved 120 basis points to 5.0% from 3.8% of sales in the second quarter of 2009.
• Net income increased 50.1% to $3.3 million, or $0.20 per diluted share, compared to $2.2 million, or $0.14 per diluted share in the second quarter of 2009.

Six Month Highlights

• Net sales increased 17.1% to $225.0 million compared to $192.1 million for the six months ended August 1, 2009.
• Comparable store sales increased 11.7% over the same period last year.
• Operating profit margin improved 200 basis points to 7.1% from 5.1% last year.
• Net income increased 65.9% to $9.7 million, or $0.60 per diluted share, compared to $5.8 million, or $0.37 per diluted share for the corresponding period last year.

Jeff Gordman, President and Chief Executive Officer, stated: "We are pleased with the top line momentum and earnings growth we experienced during the second quarter. We successfully executed on several key initiatives which have enabled us to enhance our operational platform and to further strengthen our market position. Our value-based selling proposition and our broad merchandise assortments have enabled us to increase our market share in a challenging environment. We believe that we have effective strategies and systems in place to sustain our comparable store sales growth and to pursue a significant unit expansion plan in order to create long-term value for our shareholders."

Second Quarter Financial Results
Net sales for the thirteen weeks ended July 31, 2010, increased 14.7% to $113.1 million from $98.6 million for the thirteen weeks ended August 1, 2009, while comparable store sales increased 8.3% during this timeframe. Gross profit increased 15.7% to $49.9 million, or 44.2% of sales, from $43.2 million, or 43.8% of sales in the prior year. Selling, General and Administrative costs were $44.3 million, or 39.2% of sales, compared to $39.4 million or 40.0% of sales in the prior year.

Operating income increased 50.9% to $5.6 million, or 5.0% of sales, compared to $3.7 million, or 3.8% of sales in the prior year. Net income increased 50.1% to $3.3 million, or $0.20 per diluted share, compared to $2.2 million, or $0.14 per diluted share in the prior year.

Six Month Financial Results
Net sales for the twenty six weeks ended July 31, 2010, increased 17.1% to $225.0 million from $192.1 million for the twenty six weeks ended August 1, 2009, including a comparable store sales increase of 11.7%. Gross profit increased 19.9% to $102.5 million, or 45.5% of sales, from $85.5 million, or 44.5% of sales in the prior year. Selling, General and Administrative costs were $86.6 million, or 38.4% of sales, compared to $75.7 million or 39.4% of sales in the prior year.

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