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FGL Q1 sales hampered by poor spring weather
16 Jun '08
3 min read
Gross Margins:
Combined gross margin for the 13 weeks ended May 4, 2008 was 34.3% of revenue, or $105.4 million, compared to 33.3%, or $98.0 million in the previous year. The overall rate increase reflects rate increases in both the corporate retail and franchise wholesale results and a shift in the sales mix between retail and wholesale sales in the quarter.
The dollar improvement was driven by sales growth in the corporate business as well as solid franchise results at improved margins. Corporate store category sales results were mixed with weak performance in winter categories, particularly ski, snowboard, hockey, outerwear and accessories, casual clothing and footwear. Spring category performance, particularly in cycling, camping, fitness and racquets were strong despite the unseasonably cool weather.
Expenses:
Same store operating expenses were 30.4% of corporate store revenues versus 28.1% in the prior year, a reflection of the reduced sales volume. In absolute dollars, same store costs increased $1.5 million, or 2.8%.
Overall store operating expenses were 33.5% against the prior year of 29.6%. The increase is a combination of costs associated with Athletes World ($9.6 million), the acquisition, in September 2007, of former Nevada Bob's franchise locations ($1.3 million) and new store openings, offset by the elimination of overhead from 9 Fitness Source stores franchised in April 2007 ($0.6 million).
On an ongoing basis, the operating expenses associated with Athletes World are expected to be in line with corporate same store run rates as certain costs are integrated and stores operations are normalized following the emergence from CCAA.
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Combined gross margin for the 13 weeks ended May 4, 2008 was 34.3% of revenue, or $105.4 million, compared to 33.3%, or $98.0 million in the previous year. The overall rate increase reflects rate increases in both the corporate retail and franchise wholesale results and a shift in the sales mix between retail and wholesale sales in the quarter.
The dollar improvement was driven by sales growth in the corporate business as well as solid franchise results at improved margins. Corporate store category sales results were mixed with weak performance in winter categories, particularly ski, snowboard, hockey, outerwear and accessories, casual clothing and footwear. Spring category performance, particularly in cycling, camping, fitness and racquets were strong despite the unseasonably cool weather.
Expenses:
Same store operating expenses were 30.4% of corporate store revenues versus 28.1% in the prior year, a reflection of the reduced sales volume. In absolute dollars, same store costs increased $1.5 million, or 2.8%.
Overall store operating expenses were 33.5% against the prior year of 29.6%. The increase is a combination of costs associated with Athletes World ($9.6 million), the acquisition, in September 2007, of former Nevada Bob's franchise locations ($1.3 million) and new store openings, offset by the elimination of overhead from 9 Fitness Source stores franchised in April 2007 ($0.6 million).
On an ongoing basis, the operating expenses associated with Athletes World are expected to be in line with corporate same store run rates as certain costs are integrated and stores operations are normalized following the emergence from CCAA.
Click here to view more:
Forzani Group Ltd
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