Specialty retailer Chico's FAS, Inc. (CHS) reported Thursday a profit for the fourth quarter that grew 26 percent from last year, reflecting improved margins and revenue growth across brands. Adjusted earnings per share matched analysts' expectations, while quarterly revenues missed their estimates.
The Fort Myers, Florida-based company reported net income of $31.52 million or $0.19 per share for the fourth quarter, higher than $25.10 million or $0.15 per share in the prior-year quarter.
Excluding special items, adjusted net income for the quarter was $32.70 million or $0.20 per share, compared to $25.19 million or $0.15 per share in the year-ago quarter.
On average, 15 analysts polled by Thomson Reuters expected the company to report earnings of $0.20 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales for the quarter increased 14.5 percent to $651.85 million from $569.21 million in the same quarter last year, but missed twelve Wall Street analysts' consensus estimate of $665.57 million.
Consolidated comparable sales for the quarter increased 3.7 percent, compared to a 8.7 percent rise last year, reflecting increases in both average dollar sale and transaction count.
The company noted that comparable sales growth primarily reflected a positive customer response to fashion assortments and the effectiveness of its innovative marketing plans.
Net sales for Chico's/Soma Intimates rose to $396 million from $354 million in the prior-year quarter, and White House/Black Market net sales totaled $236 million, up from $187 million in the year-ago quarter. Boston Proper sales grew to $30 million from $28 million last year.
Chico's/Soma Intimates comparable sales grew 2.3 percent, and White House/Black Market brands' comparable sales increased 6.3 percent.
Operating margin for the quarter expanded 70 basis points to 7.5 percent as gross margin improved 90 basis points, and total selling, general and administrative expenses as a percentage of net sales improved 10 basis points.
Separately, Chico's FAS announced that its board has declared a 4.8 percent increase in quarterly cash dividend to $0.055 per share on its common stock, payable on April 1 to shareholders of record at the close of business on March 18, 2013. The board also authorized the repurchase of up to $300 million of the company's outstanding common stock, effective March 1, 2013.
For fiscal 2012, the company reported net income of $180.22 million or $1.08 per share, higher than $140.87 million or $0.82 per share in the prior year. Excluding special items, adjusted net income for the year was $182.19 million or $1.09 per share, compared to $144.45 million or $0.84 per share in the year ago. Net sales for the full year increased to $2.58 billion from $2.20 billion in the previous year.
Street was looking for full-year 2012 earnings of $1.09 per share on annual revenues of $2.59 billion.
Looking ahead, the company said it is looking to provide its shareholders with substantial value by delivering on its long-term objectives to increase sales by a low double-digit percentage and diluted earnings per share by a mid-teen percentage over a meaningful period of time.
In Thursday's regular trading session, CHS is currently trading at $16.87, up $0.46 or 2.80% on a volume of 2.21 million shares.
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