Cache expects Q1 2011 comparable store sales to increase 7%
Cache Inc, a specialty chain of women's apparel stores, reported results for the thirteen and fifty-two week periods ended January 1, 2011. Fiscal 2009 represented a 53-week year and as such, the fourth quarter and fiscal year 2010 periods compare to the fourteen and fifty-three week periods ended January 2, 2010 last year.
The Company noted that the fifty-third week in fiscal 2009 contributed $4.7 million to net sales, $1.3 million to pre-tax income and $0.05 per diluted share in the fourth quarter and $0.06 per diluted share, respectively, in fiscal 2009.
Thomas Reinckens, Chairman and Chief Executive Officer, commented: “2010 marked a pivotal year where we made strides to position our Company for long term growth in sales and profitability. During the year, we focused on realigning our business processes and optimizing our new design and merchandise talent, with a goal of elevating product assortments to broaden our reach, while maintaining the sophistication and style that our customers expect of us.
“At the same time, we maintained our stringent control of expenses and inventory. While our 2010 results were pressured, as it took time for our team and initiatives to take hold, our efforts are paying dividends for us as we begin the spring season and we are optimistic for the 2011 fiscal year.”
“We are excited about the opportunities to drive increased sales productivity and improved profitability in 2011, with our first quarter performance aligned with this goal,” Mr. Reinckens continued. “As we begin 2011, consumers have responded favorably to our assortments across categories, leading to a 7% increase in comparable store sales and improvement in merchandise margins during the first quarter to date, as compared to the first quarter of 2010.
“We expect to report a significant improvement in our first quarter results. As we look ahead, our priorities will focus on generating consistent selling deliveries and increased merchandise margins, as we leverage our strengthened design and merchandise talent, as well as continuing improvement of our sourcing and distribution infrastructure. We believe that the major restructuring orchestrated in 2010, will lead to improved sales and operating performance in 2011, as well as sustained growth in the future.”
For the 13-week period ended January 1, 2011 (compared to the 14-week period ended January 2, 2010):
• Net sales decreased 14% to $55.9 million from $65.0 million in the fourth quarter of fiscal 2009. Comparable store sales declined 6%, as compared to a decrease of 7% in the fourth quarter of fiscal 2009;
• Pre-tax loss totaled $13.8 million and included $10.5 million of other charges, or $0.51 per diluted share; including (i) $9.1 million related to the write-off of the remaining carrying value of the Company's goodwill associated with its AVD reporting unit; (ii) $974,000 in store asset impairment; and (iii) $459,000 in other legal expenses. This compares to pre-tax loss of $2.3 million, which included $2.7 million in non-cash impairment charges in the fourth quarter of fiscal 2009;