• Q4 profit surges to $4.3m
  • Sales edged up 0.3% to $124.3m
  • Full year profit climbed 73% to $16.8m

Maternity wear retailer Destination Maternity Corporation has tripled its fourth quarter profit, and says it expects strong earnings growth to continue in the year ahead.

Net income in the three months to 30 September surged to $4.3m or $0.67 per share, from $1.4m or $0.22 per share in the same period a year earlier.

Quarterly sales edged up 0.3% to $124.3m from $123.8m last time, helped by the re-launch of the Two Hearts Maternity collection in Sears and Kmart stores last year, as well as higher Internet and international sales. But comparable store sales slipped 0.9%.

For the full year, profit surged 73% to $16.8m or $2.65 per share from last year's $9.7m or $1.60 per share.

Revenues were nearly flat at $531.2m versus last year's $531.3m. Comparable retail sales (which includes store and Internet sales) were down 3.4% during the year, with same-store sales dropping 5.1%.

“We are very pleased with the progress we made in fiscal 2010 in continuing to improve the profitability of our business, even in the face of a continued challenging sales environment,” said president and CEO Ed Krell.

“Our improved earnings performance was driven primarily by the expense savings from our cost reduction initiatives and our strong merchandise gross margin performance, as well as from increases in Internet sales, sales from our leased department relationships, marketing partnership revenues, and international sales.”

Looking ahead, the retailer expects sales in the year ahead to rise by between 5.4% and 7.5% to the range of $560m to $571m, driven by expansion into more Macy’s, Sears and K-Mart stores. Earnings per share are seen rising 33-46% to between $3.52 and $3.87.

For the first quarter, net sales  are forecast in the $132.5m to $135.5m range, with same-store sales in the range of down 1.5% and up 0.5%.