NEW YORK -- St. John Knits reported earnings climbed 42.5 percent in the first quarter on a sales increase of 30.8 percent, outperforming analysts' expectations.
In the period ended Jan. 30, earnings totaled $2.8 million, or 34 cents a share, against $2 million, or 24 cents, a year ago.
Sales rose to $27.3 million from $20.8 million. Boosted by four additional boutiques and two outlet stores, sales at the retail division jumped 65.7 percent to $5.8 million from $3.5 million. Same-store sales advanced 14.9 percent. Gross profit as a percentage of sales was 52.8 percent, against 50.3 percent, reflecting a greater number of units produced without increased costs.
St. John stock was up 1 3/8 to close at 25 1/8 Thursday on the New York Stock Exchange. In a conference call with security analysts, Robert E. Gray, chairman and chief executive officer, said the company plans to expand its product line. Handbags have been in the company-owned stores for six months and will be introduced in Saks Fifth Avenue, Neiman Marcus and Nordstrom, three of the company's key stores.
According to the annual report, in 1993, volume from its major retail customers broke down this way: Saks, 25.3 percent of total sales; Neiman Marcus, 14.1 percent; Nordstrom, 12.7 percent, and R.H. Macy & Co., 6.6 percent. St. John is developing a fragrance that should be out this fall, said Gray, and is currently negotiating distribution. The company is also close to signing a shoe licensing agreement.
Gray said that "perhaps we have only scratched the surface" of the domestic market, and added that business is strong in European markets as well.
St. John has purchased new knitting machines to meet new growth goals, he said. The new machines can also produce more intricate designs and will reduce labor expenses.
Two St. John boutiques will open this year, Gray continued. Present stores account for 21 percent of total sales.
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