Store operating expenses, as a percent of corporate store revenue, were 29.6% against the prior year of 29.5% . In absolute dollars, store operating expenses fell $0.2 million.
The overall store operating expense decrease reflects the closing/franchising, in the past year, of 8 corporate stores (net of openings), specifically the franchising of 9 Fitness Source stores, acquired in January 2006, which were franchised in April 2007. Same store operating costs were 27.9% of corporate store revenues versus 28.1% in the prior year. Same store costs, in absolute dollars, decreased $0.4 million or 0.8%.
General and administrative expenses were 8.8% of total revenue versus the prior year's 7.0% . The absolute dollar increase of $6.4 million was a combination of standard year over year increases and the timing of accruals for anticipated year-end, performance-based compensation.
In fiscal 2007, first quarter accruals for performance-based compensation were minimal as there was uncertainty with regard to the attainment of targets. These reduced expenses will be in the third and fourth quarters of the year.
Earnings before interest, taxes, loss on sale of investment, and amortization ("EBITA") were $14.5 million, a 13.3% improvement over the prior year's EBITA of $12.8 million.
The Company's first quarter of fiscal 2008 continues the strength exhibited in the results of the fiscal 2007 year. Franchise operations continue to perform to plan and, corporate stores matched their record first quarter sales results from 2007 while continuing the trend of higher margins due to better assortment planning and replenishment.
It should be noted that the licences held as a result of the original investment in a trademark licensing company have been, and continue to be highly profitable for the Company.
For the first four weeks of Q2, fiscal 2008, same store sales from corporate stores grew by 4.5% and franchise comparable store sales increased 14.6%, with strong margins.
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.jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "UBM China (Shanghai)")
-Ltd..jpg?tr=w-120,h-60,c-at_max,cm-pad_resize,bg-ffffff "Thermore (Far East) Ltd.")
