NEW YORK — Although top-line growth was robust, and results from its better business were better than expected, Jones Apparel Group posted a first-quarter decline in profits.
Still, earnings per share for the period ended April 2 beat analysts’ consensus estimate by a penny.
Net income for the quarter dropped 7.8 percent to $87 million, or 71 cents a diluted share, from $94.4 million, or 73 cents, in the prior year on sales that rose 10.8 percent to $1.35 billion from $1.22 billion. Analysts had the company pegged to earn 70 cents.
Peter Boneparth, president and chief executive officer, said in a statement that “results were better than we had anticipated, partially as we benefited from approximately $27 million in net shipments and approximately $11 million in associated operating income during the first quarter, which we had planned in the second quarter.”
The ceo went on to say that the better-than-expected results were “primarily realized in our better wholesale apparel businesses.”
Boneparth said same-store sales from its footwear and ready-to-wear stores, which exclude Barneys New York, the acquisition Jones made last year, fell 3.7 percent in the quarter.
“We are very encouraged by the continued strong performance of our Barneys New York luxury retail business that generated a comparable-store sales increase of 10.7 percent in the quarter, as compared with 18.7 percent in the first quarter of 2004,” the ceo explained. “These positives were offset by weakness in our wholesale footwear, accessories and junior denim businesses. Gross margin pressure in these businesses dampened our performance and overall results.”
The company said the acquisitions of Barneys and Maxwell Shoe bolstered sales by $180.7 million.
Regarding earnings for the year, the company said it expects full-year EPS to be in the range of $2.75 to $2.85, which is trimmed slightly from a prior estimate of $2.75 to $2.90.
This story first appeared in the May 6, 2005 issue of WWD. Subscribe Today.