• Q4 net profit surged 135% to $4.7m from $2m
  • Net sales rose 8.3% to $132.3m
  • Same-store sales increased 7.0% 

Fashion retailer Bebe Stores Inc has more than doubled its fourth quarter net income after last year's results were hurt by the closure of its PH8 chain.

But profit from continuing operations in the three months to 2 July slipped 13% to $4.7m or $0.06 per share, compared with $2.05m or $0.06 per share, a year earlier after higher raw material and production costs offset higher sales to eat into margins.

Net sales rose 8.3% to $132.3m from $122.1m, and same-store sales increased 7.0%. But higher raw material and production costs led to a initial mark-up, which in turn pushed gross margin down to 41.1% of net sales from 42.2% the year before.

For the full year, the company earned $4.1m or $0.05 per share, from continuing operations, a drop of 48% from last year's $8.0m or $0.09 per share. It narrowed it net loss to $1.8m from $5.2m last time.

Fiscal net sales were up 2.8% to $493.3m from $480m, and same-store sales edged up 0.4%. A change in product mix and higher production costs, offset by improved markdowns, saw gross margin fall 150 basis points to 38.9% of net sales.

Looking ahead, the retailer expects comparable store sales to be in the positive mid-single digit range, leading to results of between a net loss of $0.01 per share to $0.01 net income per share.