US: Charlotte Russe profit up but cautious on next quarter
Young women's fashion retailer Charlotte Russe has reported increased first-quarter earnings, but said profit may suffer in the next quarter as the Rampage business continues to struggle.
First-quarter net earnings totalled US$7.1m compared to $2.2m in the same period last year. Net sales were up 34.3% to $201.5m during the quarter from $150.0m last year.
Quarterly same-store sales rose 15.6% compared to a 9.9% fall a year ago.
Chief executive Mark Hoffman commented: "Our comparable-store sales improvement in this first quarter reflects significant progress made in both brands to reclaim market share.
"Charlotte Russe recorded positive comp sales trends in apparel which was complemented by continued strength in our accessory categories.
"Rampage, while posting double-digit comp sales growth, continues to be a work in process with its brand repositioning."
The company engaged in a high number of markdowns at Rampage, and store-level financial performance was not much better than the same time last year, the company admitted.
Hoffman said inventory levels at comparable stores were up 20% over last year, partly because of earlier receipts of transitional spring merchandise this year.
Charlotte Russe is a growing mall-based specialty retailer of fashionable, value-priced apparel and accessories targeting young women in their teens and twenties.
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