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Deb Shops announces net sales up 4.3% for Q2

25 Aug '05

3 min read

Specialty apparel stores operator Deb Shops Inc reported financial results for the second quarter ended July 31, 2005.

For the second quarter of fiscal 2006, net sales increased 4.3 percent to $76.0 million compared to $72.8 million in the second quarter a year ago. Gross profit, which is net of buying and occupancy costs, increased to $29.0 million resulting in a gross margin of 38.2 percent for the period. This compares to gross profit of $25.7 million and a 35.3 percent gross margin in the second quarter of fiscal 2005. Second quarter net income increased to $6.6 million compared to $4.6 million in the second quarter of fiscal 2005, while diluted earnings per share increased to $0.46 from $0.34 in last year's second quarter. Where applicable, prior year amounts reflect the effects of the Company's lease accounting restatement. The restatement did not affect prior year diluted earnings per share.

As of July 31, 2005, the Company had $188.7 million in cash and marketable securities, shareholders' equity of $119.1 million, and no debt. Net of the effects of the $6.125 per share dividend that was paid on August 16, 2005, the Company's July 31, 2005 cash and marketable securities balance would have been approximately $101 million.

Net sales for the first six months of fiscal 2006 increased 5.2 percent to $153.5 million from $145.9 million for the comparable prior year period. Gross profit, which is net of buying and occupancy costs, increased to $50.8million resulting in a gross margin of 33.1 percent for the period. This compares to gross profit of $45.1 million and a 30.9 percent gross margin in the comparable prior year period. Net income for the period increased to $9.4 million, or $0.66 per diluted share, versus $5.5 million, or $0.40 per diluted share, in the first half of fiscal 2005.

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