NEW YORK — Demand for sweaters, denim and accessories pushed Bebe Stores Inc.'s first-quarter profits up 18.9 percent and drove a 22.3 percent rise in the quarter's revenues.
In the three months ended Oct. 1, the Brisbane, Calif.-based specialty retailer earned $13.6 million, or 14 cents a diluted share, compared with $11.4 million, or 13 cents, in the year-earlier period. Results in the latest quarter include a 2 cent charge due to a stock-based compensation expense. Analysts had been expecting a profit of 16 cents.
Revenues in the quarter totaled $126.2 million versus $103.1 million in the same quarter last year, while same-store sales soared 17.3 percent. The company said sales in last year's first quarter included three extra days worth about $3.9 million due to a change in its fiscal year.
First-quarter gross profit expanded to 49.3 as a percent of sales compared with 48.6 percent last year. Bebe cited favorable occupancy leverage as a result of higher comparable-store sales.
On a post-earnings conference call with analysts, Greg Scott, chief executive officer of Bebe, said while denim performed well — and is expected to maintain strength in the second quarter — the company saw weakness in tops at its Bebe stores during the quarter. Bebe Sport, however, had a great quarter, Scott said, adding that sales were above the company's average, driven by demand for tops, sweaters and outerwear.
Scott said the company plans to open 35 stores in fiscal 2006, including 20 Bebe and 12 Bebe Sport stores. Notably, a Bebe store is planned to open on Rodeo Drive in Los Angeles in November with an expanded shoe and handbag section.
Also in the second quarter, the company said it plans to launch a branded performance line called Bebe SB in its Bebe Sport locations.
Bebe anticipates EPS of 24 cents to 29 cents in the second quarter, including a stock-based compensation expense. Same-store sales are seen up in the low- to midsingle digits. Analysts are expecting earnings of 31 cents on sales of $179.3 million in the second quarter.
Shares of Bebe closed Thursday trading off 4.2 percent at $15.20.
Bebe operates 224 stores, made up of 170 Bebe stores, 35 Bebe Sport stores and 19 Bebe outlet locations.
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