Girls' apparel retailer Too Inc on Wednesday reported a 35 per cent increase in third quarter profit to $10.8 million, or $.31 per diluted share, compared to $8.0 million, or $.25 per diluted share for the third quarter 2001.

The firm said higher merchandise margins and lower expenses as a percentage of net sales were the primary drivers behind the earnings improvement.

Net sales for the thirteen weeks ended 2 November 2002 increased 11 per cent to $164.6 million, up from $148.8 million for the same period last year. The sales increase was primarily attributable to a 10 per cent increase in Limited Too store square footage the company said in a statement.

Comparable store sales for the 2002 quarter decreased 1 per cent year-on-year.

Net income for the 39 week period was $22.2 million, or $.65 per diluted share, compared to net income of $14.7 million, or $.46 per diluted share, for the like period last year.

Net sales for the first nine months of fiscal 2002 were $464.5 million, a 13 per cent increase over net sales of $410.9 million for the comparable period last year.