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Buckle Enacts Stock Split, Special Dividend

Retailer's shares hit new 52-week high on shareholder moves.

Shares of The Buckle Inc. hit a 52-week high Tuesday as the teen retailer declared a $3-a-share one-time special cash dividend, raised its quarterly dividend 5 cents a share to 30 cents and approved a 3-for-2 stock split.

The special and quarterly dividends will be paid on Oct. 27 to shareholders of record Oct. 15.

The split will take the form of a one-share dividend for every two shares owned as of Oct. 15. It is expected to take effect on or about Oct. 30. Fractional shares will be paid in cash based on their Oct. 15 value.

“When we’re successful, we like to share it with the shareholder,” said Buckle’s corporate controller Tom Heacock. “We’re going to continue what we’ve been doing. It’s been working for us.”

After hitting the high of $59.50, shares of the Kearney, Neb.-based retailer closed at $59.01, up $2.15, or 3.8 percent, in New York Stock Exchange trading. Shares have risen 78.8 percent this year, from $33 at the end of 2007.

Although the special dividend was slightly higher than anticipated, the dividend package had been expected, said Susquehanna Financial Group retail analyst Tom Filandro, who added that Buckle has been raking in sizable profits, and putting up major gains in comparable-store sales, despite the gloomy economic environment.

“They are clearly casting a wider net, attracting a much broader audience than in the past and driving significant transactional growth,” he said.

Filandro said Buckle differentiates itself from the competition in its moderate-price denim, which ranges from $50 to about $150, and its diverse knit business, which includes brands like Affliction, OBEY and Aqua VI.

“They clearly have the most dominant presentation in that fast-turn knit business, which is enabling them to drive comps with very modest inventory growth,” Filandro said. “They continue to buck the sector trends.”

During the second quarter ended Aug. 2, the company reported an 88.9 percent jump in profits, on a 36.6 revenue increase and a 27.8 percent jump in same-store sales. Net income was $22.3 million, or 72 cents a diluted share, compared with $11.8 million, or 38 cents a share for the same 2007 period. Net sales hit $169.8 million, versus $124.3 million a year ago.

During the first half, net income rose 70.9 percent to $41 million. Sales were up 34.5 percent, to $330.1 million, and rose 26.7 percent on a same-store basis.

August comps rose 22.4 percent, compared with a 16.7 percent increase in comps last year.