Fabric and crafts retailer Jo-Ann Stores, Inc. (JAS), reported on Wednesday a surge in its fourth quarter profit, driven by same-store sales growth, improved margins due to reduced product costs from global sourcing initiatives, lower clearance levels and reduced freight costs. Earning for the quarter breezed ahead of Street estimates, as did revenues. Looking ahead, the company provided its earnings forecast for fiscal year 2011.
The Hudson, Ohio-based company reported net income for the fourth quarter of $37.1 million or $1.36 per share, compared to $20.4 million or $0.79 per share in the year-ago quarter.
Net income for the prior year fourth quarter included a $1.3 million after-tax gain, or $0.05 per share, related to the purchase of a portion of the company's senior subordinated notes. Excluding the gain, net income for the prior year fourth quarter was $19.1 million or $0.74 per share.
On average, six analysts polled by Thomson Reuters expected the company to earn $1.33 per share for the quarter. Analysts estimates typically exclude special items.
Net sales for the quarter increased 5.3% to $602.2 million from $571.9 million in the prior-year quarter. Analysts anticipated revenues of $600.40 million for the fourth quarter.
Same-store sales increased 4.4% compared with a 2.9% same-store sales decrease for the fourth quarter last year.
In the immediately preceding quarter, Jo-Ann Stores reported a more than doubled third quarter profit, by same-store sales growth, improved margins, inventory management, and expense control initiatives. The company posted net income of $24.1 million or $0.90 per share, on revenues of $509.1 million for the third quarter.
For the quarter under review, segment wise, Large-format store net sales for the quarter increased 7.9% to $323.8 million, compared to the same period last year. Same-store sales for large-format stores increased 3.1% compared with a decrease of 4.1% in the same period last year.
Small-format store net sales for the quarter increased 2.6% to $266.1 million compared to the same period last year. Same-store sales for small-format stores increased 6.1% compared with a decrease of 1.4% in the same period last year. Internet sales through Joann.com of $12.3 million were flat with the same period last year.
Gross margins for the fourth quarter increased about 410 basis points to 47.6% compared to the same period last year, on reduced product costs from global sourcing initiatives, lower clearance levels and reduced freight costs.
Selling, general and administrative expenses for the quarter was $207.9 million, a 4.1% increase compared to the same period last year.
Operating profit for the fourth quarter was $61.1 million versus $32.5 million for the same period last year.
During the fourth quarter of fiscal year 2010, the company opened one small-format store and closed one large-format store and 12 small-format stores. Further, the company remodeled four stores of which one was transitioned from a small-format to a large-format layout in the fourth quarter of 2009..
For the fiscal year 2009, the company's net income surged to $66.6 million or $2.51 per share from $21.9 million or $0.86 per share last year.
The current fiscal year net income includes a $0.8 million after-tax gain, or $0.03 per share, compared to $2.6 million after-tax gain, or $0.10 per share a year ago, related to the purchase of a portion of the company's senior subordinated notes.
Excluding the gain, net income for the fiscal year was $65.8 million or $2.48 per share, compared to $19.3 million or $0.76 per share prior year.
Net sales for the fiscal year increased 4.7% to $1.99 billion from $1.90 billion in the prior year. Same-store sales increased 3.1% compared with a same-store sales increase of 0.5% last year.
Analysts were looking for earnings of $2.46 per share, on revenues of $1.99 billion for the fiscal year 2010.
Looking forward for fiscal 2011, the company expects earnings to be in the range of $2.75 to $2.90 per share, and same-store sales anticipated to grow in the range of about 2.5% to 3.5% for the year.
Analysts currently expect earnings of $2.85 per share for fiscal 2011.
For fiscal year 2011, Jo-Ann expects to open about 30 new stores and close about 30 stores. The company also expects to remodel at least 40 stores during the year.
Jo-Ann Stores closed Wednesday's regular trading at $40.01, up 72 cents or 1.83%, on a volume of 0.49 million shares on the NYSE. However, in after-hours, the shares lost $0.57 or 1.42%, trading at $39.44.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.