By  on September 29, 2006

NEW YORK — Fueled by another healthy year of growth and its new owners' desire to get a return on their investment, Neiman Marcus is ready to expand on several fronts.

The luxury chain was acquired for $5.1 billion last year by an investment group led by Texas Pacific Group and Warburg Pincus LLC, and on Thursday reported adjusted operating earnings for fiscal year ended July 29 of $450 million, a 7.6 percent increase compared with the $418.1 million in adjusted operating earnings for fiscal 2005.

Fourth-quarter adjusted operating earnings came to $38.5 million, compared with $40.6 million in the year-ago period, with the difference primarily due to the loss of finance charges stemming from the sale of the credit card business and higher depreciation.

Sales continued to be robust, climbing 9 percent to $915.5 million in the fourth quarter, compared to $839.8 million in the prior-year period, with comp-store sales increasing 6.6 percent. For the year, the company posted revenues up 7.9 percent to $4.1 billion, compared with $3.8 billion in the prior year, with comps rising 6.8 percent.

"Fiscal 2006 was an outstanding year from every aspect," Neiman's chairman and chief executive Burt Tansky said, marked by several new performance records for the business. Aside from cracking $4 billion in sales for the first time, sales per square foot reached $611, compared with $577 in fiscal 2005, an increase of just under 6 percent.

"It's a level of productivity substantially higher than our competitors," Tansky boasted.

He also said the company achieved nearly an 11 percent operating margin, maximized full-price selling, and that the merchant organization maintained "a very disciplined buying strategy."

Recently, business has been strongest in contemporary sportswear and designer handbags, both up by more than 15 percent, as well as eveningwear, couture and dresses, precious and fine jewelry, and shoes.

The company reported net income of $56.6 million for the year, against $248.8 million in the year before, and a fourth-quarter net loss of almost $42 million, versus a profit of $56.6 million in the prior year's period. The fourth-quarter figure includes a loss on the sale of the Gurwitch color cosmetics business, which owns the Laura Mercier brand.

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