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: ITMA 2015

Textiles | On 21st Jun 2018

Italy to host textile machinery fair ITMA in 2023

ITMA, the trendsetting textile and garment technology platform, will...

Courtesy: Connor Group

Textiles | On 21st Jun 2018

Protectionism top threat to textile sourcing: William Connor

Protectionism is the biggest political factor and threat affecting...

NRF urges US Congress to step in, stop trade war

Apparel/Garments | On 21st Jun 2018

NRF urges US Congress to step in, stop trade war

The National Retail Federation (NRF) recently urged the US Congress...

Interviews View All

Giovanni Pizzamiglio, Paolo Crespi & Riccardo Robustelli
Epson, For.Tex & F.lli Robustelli

‘The percentage share of printing in the global textile market is pretty...

Headhonchos
Indian fashion industry

Cotton consumption will keep growing in the Indian fashion industry

Evelyne Cholet
UCMTF

‘France had a reputation of being big in new ideas, but poor in marketing...

Mala Alwani

<div>Delhi-based fast fashion womenswear brand, Besiva, aims to bridge the ...

Rajat Jaipuria

Activewear brand Soul Space promotes organic cotton farming and...

Harsh Shah

Established in 1956 with a small beginning, Embee today manufactures a...

Johan Berlin
InvestKonsult Sweden AB

Investkonsult Sweden AB has been buying and selling second-hand textile...

Silke Brand-Kirsch
Schlegel und Partner

Silke Brand-Kirsch, executive partner of Schlegel und Partner, a leading...

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Sanjukta Dutta
Sanjukta's Studio

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

Yash P. Kotak
Bombay Hemp Company

One of the directors of Bombay Hemp Company, Yash P. Kotak, speaks to...

Amiben Shroff
Shrujan

From its modest beginning in the late 1960s, Shrujan has grown into a...

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

Leave your Comments


June 2018

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

news category


Related Categories:

Advanced Search