Home / Knowledge / News / Gross margins up at Sterling Shoes
Gross margins up at Sterling Shoes
24
Mar '10
Sterling Shoes Income Fund reported its financial results for the fourth quarter and year ended December 31, 2009.

Fourth Quarter Highlights:

• Net bank debt improved to $0.9 million at December 31, 2009 from $11.8 million at September 30, 2009
• Sales were $41.2 million in fourth quarter 2009 compared to $42.5 million in 2008
• Gross margin increased to 56.3% of sales in fourth quarter 2009, compared to 56.0% last year
• Store and selling expenses and G&A expenses both decreased in fourth quarter 2009 as a percentage of sales compared to 2008
• Adjusted EBITDA rose to $8.1 million or 19.8% of sales in fourth quarter 2009 compared to $7.8 million or 18.3% of sales in 2008

"We are pleased with our fourth quarter performance", said Jeremy Horwitz, President and Chief Executive Officer. "Despite challenging economic conditions and lower sales, Sterling improved gross margins, lowered operating and administrative costs and increased profitability compared to the same period last year. We also reduced inventory levels, changed our product mix, restricted maintenance and capital expenditures, and suspended distributions to Unitholders."

"These actions have improved our cost competitiveness and reduced our net debt, thereby providing us with greater business flexibility. We believe that our business is currently in a much better position to weather future economic volatility than it was twelve months ago. We are also positioning Sterling for sustainable long-term earnings and growth once economic conditions stabilize."

Financial Results for the three months ended December 31, 2009

During the three months ended December 31, 2009, sales declined 3% to $41.2 million from $42.5 million a year earlier. Same store sales declined by 5.6% compared to the same period during 2008.

Cost of sales as a percentage of sales for the three months ended December 31, 2009 was 43.7% compared to 44.0% for the same period during 2008. Efforts to reduce inventory levels during the first three quarters of 2009 allowed Sterling to make room for higher margin inventory, which contributed to higher margins during the three month period ended December 31, 2009. These efforts were offset in part by the cost of heavy promotional activity required to generate sales, clear inventory and respond to competitive forces.

Store and selling expenses for the three months ended December 31, 2009 were 30.7% of sales, compared to 31.5% for the same period during 2008. Store and selling expenses have a fixed underlying core with a large variable component, primarily consisting of expenses relating to occupancy and employee costs. The Fund undertook a comprehensive review of business processes during earlier months which resulted in greater operating flexibility and a reduction of store and selling expenses in the last quarter of 2009. The Fund did not open any new stores during the three months ended December 31, 2009.

Must ReadView All

Courtesy: Christian Dior

Fashion | On 25th Apr 2017

LVMH to acquire Christian Dior Couture for €6.5bn

LVMH and Christian Dior, which holds directly and indirectly 41 per...

Information Technology | On 25th Apr 2017

Self-repairing fabrics to be the future of fashion

It is the era of smart. Intelligent materials like self-repairing...

Textiles | On 25th Apr 2017

Indonesia revitalising textile sector

With exports of textile and textile products rising in Indonesia, the ...

Interviews View All

Vidhyaa Shankar. S
A Ganapathi Chettiar

'The usage of knits is getting into the boundaries of woven fabrics'

Sanjay Yagnik
Maa Tex Speciality

‘We suggest reducing dosage of sizing chemicals to reduce sludge...

Nishank Patel
Shri Dinesh Mills Limited

Broad range of fabrics will sell well this financial year

Ashok Desai
Bombay Textile Research Association

Bombay Textile Research Association (BTRA) is a leading name in textile...

Lynda Kelly
Suominen Corporation

Suominen Corporation is a manufacturer of nonwovens as roll goods for...

Iago Castro Asensio
RCfil Distribuciones S.L.

Iago Castro Asensio, International Business Manager of RCfil...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Prathyusha Garimella
Prathyusha Garimella

Hyderabad-based designer <b>Prathyusha Garimella</b> is known for blending ...

Sanjukta Dutta
Sanjukta's Studio

<b>Sanjukta Dutta</b> creates unique garments by clubbing prints of...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
April 2017

April 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search