US: Product focus helps J Crew lift Q2 sales and profit
A focus on unique products and seasonal must-haves, along with careful control of costs and inventory, have helped apparel retailer J Crew Group Inc to better-than-expected second quarter results.
"We are and have been on a long term mission to be recognised for our quality, style, design and service," said chairman and CEO Millard Drexler.
"This mission puts 'taking care of our customers' front and centre in every part of our business - our products, our service, our store environments and our web site."
Net income at the New York based firm edged up 2.8% to $18.6m or $0.29 per share, from $18.1m or $0.28 per share last year.
Revenues in the three months to 1 August rose 6% to $357.6m, with gains seen in both store sales (retail and factory), which increased 7% to $259.1m, and Direct sales (internet and phone), which rose 6% to $88.2m.
Comparable store sales, however, fell by 5%.
Gross margin increased to 41.2% of revenues, up from 41.0% in last year's second quarter.
Inventories were down to $195.3m from $197.8m, equivalent to an 11% drop in inventory per square foot, the company said.
"While we are pleased with our second quarter results, we always have our eye on where our customer is headed and the need to constantly challenge ourselves to be creative and innovative," said chairman and CEO Millard Drexler.
The company, which operates 242 stores under the J Crew, Crewcuts and Madewell nameplates, said it expects third quarter earnings per share in the range of $0.30 to $0.33.
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