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Action sport retailer West 49 Q1 earnings gain 15.5%
08 Jun '07
4 min read
West 49 Inc Canada's leading action sport retailer reported its financial results for its first quarter of fiscal 2008, ended April 28, 2007. All figures are reported in Canadian dollars.
"While we are pleased with our strong sales growth for the quarter, as expected, our margins were impacted by a few factors, which we believe our now behind us," said Sam Baio, Chief Executive Officer of West 49 Inc. "Through our decision to continue to aggressively price key items we were able to drive traffic to our stores to counter the late arrival of some spring merchandise from branded suppliers."
We were able to clear our remaining fashion outerwear from the winter season and our great spring merchandise is now flowing through the stores."Importantly, we have made progress in our stated efforts to reduce our selling, general and administrative expenses as a rate to net sales compared to the first quarter of last year."
Net sales for the first quarter of fiscal 2008 increased 15.5% to $41.0 million from $35.5 million for the first quarter of last year. The growth was primarily attributable to new stores opened by the Company since the first quarter of last year, while comparable store sales growth also contributed to the increase. Consolidated comparable store sales increased
2.9% and the core West 49 banner's comparable store sales increased 2.6%.
Gross margin for the quarter decreased 2.6% to $7.6 million from $7.8 million for the same period in fiscal 2007. As a rate to net sales, gross margin was 18.5% compared with 22.0% for the first quarter of fiscal 2007. Gross margin was impacted by several factors, including markdowns to clear
remaining fashion outerwear from the winter season, the late arrival of some spring merchandise from branded suppliers and continued aggressive pricing of key items.
The strategic decision to continue to aggressively price key items was made to drive traffic to the Company's stores to counter the late arrival of some spring merchandise. The lower gross margin rate was also attributable to higher occupancy costs as a rate to net sales, which were due to recent store expansions and opening new stores in new geographic markets.
"While we are pleased with our strong sales growth for the quarter, as expected, our margins were impacted by a few factors, which we believe our now behind us," said Sam Baio, Chief Executive Officer of West 49 Inc. "Through our decision to continue to aggressively price key items we were able to drive traffic to our stores to counter the late arrival of some spring merchandise from branded suppliers."
We were able to clear our remaining fashion outerwear from the winter season and our great spring merchandise is now flowing through the stores."Importantly, we have made progress in our stated efforts to reduce our selling, general and administrative expenses as a rate to net sales compared to the first quarter of last year."
Net sales for the first quarter of fiscal 2008 increased 15.5% to $41.0 million from $35.5 million for the first quarter of last year. The growth was primarily attributable to new stores opened by the Company since the first quarter of last year, while comparable store sales growth also contributed to the increase. Consolidated comparable store sales increased
2.9% and the core West 49 banner's comparable store sales increased 2.6%.
Gross margin for the quarter decreased 2.6% to $7.6 million from $7.8 million for the same period in fiscal 2007. As a rate to net sales, gross margin was 18.5% compared with 22.0% for the first quarter of fiscal 2007. Gross margin was impacted by several factors, including markdowns to clear
remaining fashion outerwear from the winter season, the late arrival of some spring merchandise from branded suppliers and continued aggressive pricing of key items.
The strategic decision to continue to aggressively price key items was made to drive traffic to the Company's stores to counter the late arrival of some spring merchandise. The lower gross margin rate was also attributable to higher occupancy costs as a rate to net sales, which were due to recent store expansions and opening new stores in new geographic markets.
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