Retailers have plenty of good explanations for recent declines in same-store sales. But The Buckle Inc., which made jaws drop Thursday with its 21 percent February increase, has difficulty explaining why it does so well.
The highly successful — but famously low-profile — firm, based in Kearney, Neb., has been a source of wonder during its recent strong run, but it may become a headache for competitors now as it moves its 391-store fleet to its most easterly point yet.Buckle brought its winning formula to New York state for the first time with a unit in Buffalo on Feb. 26 and will arrive in Mays Landing, N.J., just in time for the back-to-school season. With a presence in 40 states, Buckle’s greatest concentration of stores is in the Midwest and Texas and its easternmost presence before this year had been in King of Prussia, Pa. Of the 48 contiguous U.S. states, only New York, New Jersey, Connecticut, Massachusetts, Rhode Island, New Hampshire, Vermont and Delaware had been missing from its portfolio.At a time when most retailers have either closed stores or at least halted openings, expansion may seem like a bold move, but for Buckle, it’s just a “practical approach.” At least that’s what its notoriously understated chief executive officer Dennis Nelson said in an interview with WWD. That seems overly modest for a company that on Thursday marked its 30th consecutive month of comparable-store sales increases and its 19th consecutive month of double-digit comp advances. Besides February’s rise, January results saw a 20.6 percent increase for the fiscal year ending Jan. 31, along with a 27.8 percent jump in net sales, to $792 million. The company is scheduled to report fourth-quarter results Wednesday and, in the worst retail environment of its existence, is expected to generate earnings of 72 cents a share, according to analysts’ consensus estimates, versus year-ago EPS of 63 cents.Through the third quarter ending Oct. 31, net income jumped 51.7 percent to $70.1 million. Driven by higher merchandise margins and improved leveraging of buying, distribution and occupancy costs, gross margin improved 270 basis points to 42.1 percent of sales. Despite his company’s success, Nelson said he rarely speaks to the media because he “doesn’t have much to say.”“We realize it’s not easy times out there. We’re trying to take a conservative approach,” said Nelson, who added that when the company sees an opportunity, it “takes advantage.” Some believe that, with mall vacancies growing by the day, Buckle might take advantage more than it has in the past.It’s certainly in a position to do so. With no debt on the books, and $182.2 million in cash and investments at the end of the third quarter, it currently plans to open 22 stores in fiscal 2009, one more than it launched last year.The company recently added international shipping to its Web site, but when asked if that indicates Buckle is moving overseas, Nelson said it was “too early to make comments” on that.But the ceo asserted that expansion plans are all part of a controlled, focused strategy.He pointed to Buckle’s emphasis on experience and company culture, noting it doesn’t enter markets unless one of its trained managers will move to the new location. All top management has been with the company for at least 25 years, and all of the company’s district managers have about 20 years of Buckle experience. Additionally, half of the retailer’s store managers have been managing with Buckle for more than three years. The company was founded as Mills Clothing, a men’s store in Kearney, just over 60 years ago and entered the realm of casual sportswear with the acquisition of Brass Buckle in 1967. It became The Buckle in 1991 and went public in 1992, moving to the New York Stock Exchange in 1997. It has served investors well, with the stock more than doubling in the past five years and, despite following the market down last fall, the shares — when adjusted for dividends and a 3-for-2 stock split last October — have declined less than 20 percent in the past year while the S&P Retail Index has fallen 40 percent. A dollar invested in Buckle when it went public would be worth over $12 today. On Thursday, followed its robust February results, shares advanced $1.78, or 8.1 percent, to close at $23.78 while the S&P Retail Index contracted 3.6 percent.
“I grew up in New York but I hadn’t really experienced the city in any type of touristy way…This was probably the first museum I really explored and took the time to see,” said @haileybaldwin of the @whitneymuseum. On Tuesday night, Baldwin was joined by Jemima Kirke and more at the annual Whitney Museum Gala and Studio Party, which honored Lorna Simpson, Joanne Leonhardt Cassullo and Beth Rudin DeWoody. See more photos on WWD.com. #wwdeye (📷: @lexieblacklock)
Displayed starting this week at the @fashiontextilemuseum: An exhibition on designer @orlakiely titled “Orla Kiely: A Life in Pattern,” which spans two decades and contains more than 150 pieces. “I want people to come away loving pattern and print. It’s something that makes you feel so good,” said the designer during a preview of the exhibit. Also on show are mood boards, samples, sketches and more. Head to WWD.com to see more photos. #wwdfashion
Exclusive: @dsquared2 signs fragrance licensing agreement with Euroitalia, with the first effort of the new partnership being unveiled in September. The brand will launch two scents – one for men and one for women – in Italy. Read our interview with designer Dean and Dan Caten on WWD.com. #wwdbeauty #wwdnews (📷: @zefashioninsider)
@louisvuitton has officially renewed Nicolas Ghesquière’s contract as artistic director of women's collections. "I am very pleased to open the next chapter of the story I started with Louis Vuitton almost 5 years ago," said Ghesquière, who first signed on to design the French luxury brand's women's line in 2013. Get all the details on WWD.com. #wwdnews #wwdfashion (📷: @giovanni_giannoni_photo)
“I learned then and there that I had to figure out a way in life to maintain and preserve my sense of pride when I felt good about what I did or what I represented or created,” said @saintrecords on how being bullied for wearing capri pants inspired her to be the artist she is today. Knowles was at the 70th Parsons Benefit last night where she outbid the room for a Dapper Dan customized @gucci experience. #wwdeye (📷: @lexieblacklock)
“There’s this amazing braintrust of people who know the whole universe so well. So we talked to them and they gave us more input,” said actor Alden Ehrenreich on playing the young Han Solo in “Solo: A Star Wars Story.” The cast was at NYC’s SVA Theatre last night for an advanced screening of the film, which hits theaters this week. #wwdeye #starwars #hansolo (📷: @aurorarosedecrosta)
@asaprocky spent nearly two hours in a Plexiglas box Sunday night at @sothebys putting himself through a series of “tests” to demonstrate the process of completing his new album called “Testing.” Get all the details and see all the pictures on WWD.com. #wwdeye
“I’ve struggled my whole life to find a bathing suit that fits me that doesn’t look like a maternity bra. I’m proud of the line because it’s an accurate representation of me rather than me putting on someone else’s clothes,” says @atlantabean of her swimwear collaboration with @piaarrobio, LPA X ATL. The two decided on a swimwear collab and increased the industry standard size for the pieces. Read more about the line — and our interview with de Cadenet Taylor and Arrobio — on WWD.com #wwdfashion (📷: Dan Doperalski)