Claire's Stores net sales rise 9.2% for Q1 2008

20 Jun '07

2 min read

Claire's Stores Inc a leading specialty retailer offering value-priced jewelry and accessories, reported its financial results for the first quarter of Fiscal 2008, which ended May 5, 2007.

The Company reported net sales of $340.6 million for the quarter, a 9.2% increase over the first quarter of Fiscal 2007, which ended April 29, 2006. The increase was primarily attributable to the growth in our new store base, particularly in Europe, an increase in our consolidated comparable store sales and foreign currency translation gains.

First quarter results were driven by strong growth in accessories. Merchandise margins increased despite some softness in jewelry sales. Gross margins declined 20 basis points primarily because comparable store sales increases and merchandise margin gains collectively did not offset the
increase in rent and rent related expenses.

Our first quarter results were also impacted by acquisition related activities and their associated costs. For the quarter, Adjusted EBITDA rose 3.9% to $60.9 million, compared
to $58.6 million in the first quarter of Fiscal 2007.

The Company defines Adjusted EBITDA as earnings before interest, income taxes, depreciation and amortization, excluding the impact of transaction expenses incurred during the first quarter of Fiscal 2008 in connection with the May 29, 2007 acquisition of the Company by Apollo Management VI, L.P. and certain affiliated co- investment partnerships, and other non-recurring or non-cash expenses, and normalizing occupancy costs for certain rent-related adjustments.

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