Restoration Hardware Holdings Inc. (RH) Thursday reported a first-quarter loss that narrowed from a year ago, due mainly to a surge in revenues and lower expenses. The company's adjusted earnings for the period easily trumped Street expectations, as did revenues.
The home furnishings retailer also detailed a strong outlook for the second quarter, and lifted its full year guidance. Following the news, shares of Restoration Hardware rallied 11 percent in after-hours trade.
Corte Madera, California-based Restoration Hardware's first-quarter loss narrowed to $0.16 million from $3.73 million last year.
Adjusted earnings for the quarter was $0.06 per share, compared to a loss of $0.04 per share last year. On average, nine analysts polled by Thomson Reuters expected earnings of $0.04 per share for the quarter. Analysts' estimates typically exclude special items.
Restoration Hardware's revenues surged 38 percent to $301.34 million from $217.91 million last year. Analysts expected revenues of $299.13 million for the period.
Comparable store sales, or sales from stores open for at least a year, increased 41 percent on top of a 26 percent growth in the same period last year.
Restoration Hardware, which went public last November, had been posting consecutive sales growth for the past few quarters. Restoration Hardware sells home furnishing products including furniture, lighting, textiles and bathware products.
Selling, general and administrative expenses, as a percentage of revenues, dropped to 33.6 percent from 35.5 percent last year.
Looking forward to the second quarter, the company expect adjusted earnings in the range of $0.40 to $0.42 per share on revenues of $375 million to $380 million. Analysts currently expect earnings of $0.39 per share on revenues of $354.83 million for the quarter.
Restoration Hardware also lifted its full year earnings and revenue outlook. The company now anticipate adjusted earnings in the range of $1.41 to $1.47 per share with revenues of $1.47 billion to $1.51 billion. Analysts currently expect earnings of $1.40 per share on revenues of $1.48 billion for the year.
Previously, the company had projected earnings of $1.29 to $1.37 per share on revenues of $1.42 billion to $1.45 billion for the year.
RH closed Thursday's regular trade at $58.96, up $1.46 or 2.54%, on the NYSE. The stock further surged $6.51 or 11.04% in after-hours trade.
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