Chico's FAS sees lower earnings in H1

28 May '08

3 min read

Selling, general and administrative expenses ("SG&A") for the fiscal 2008 first quarter increased 3.4% to $212.1 million from $205.1 million in the prior year's first quarter. The increase in SG&A dollars for the current quarter was primarily due to increased store occupancy costs and, to a lesser extent, increased marketing spend.

As a percentage of sales, SG&A in the current quarter increased by approximately 660 basis points as the increase in the percentage was further exacerbated by the deleverage associated with the Company's negative same store sales as well as the larger size Chico's and WH|BM stores that the Company has been opening over the last two years.

Further, the mix effect of the WH|BM and Soma stores becoming a larger portion of the Company's store base also put pressure on SG&A as a percentage of sales (both WH|BM and Soma brands operate with higher store operating costs as a percentage of sales than the store operating costs as a percentage of sales experienced by the Chico's brand).

Marketing and related support costs for the fiscal 2008 first quarter increased 9.1% to $22.8 million from $20.9 million in the prior year's first quarter. As a percentage of sales, marketing costs for the current quarter increased by approximately 100 basis points due mainly to the deleverage associated with the Company's negative same store sales and an increased marketing spend for Soma and consumer research for Chico's.

Click here to view more:

Chico's FAS Inc

More Chico's FAS Inc News... More Apparel/Garments News - United States Of America...