NEW YORK —Bebe Stores Inc.’s ongoing inability to get stock into its stores cut into its fourth-quarter profits.
The Brisbane, Calif.-based firm reported Wednesday that for the three months ended June 30, net income tumbled 18 percent to $3.3 million, or 13 cents a diluted share, a penny ahead of Wall Street’s forecast and above its already-raised expectations. Last year, Bebe earned $4 million, or 15 cents. Sales for the quarter rose 9.1 percent to $80.1 million from $73.5 million and were up 2.9 percent on a comparable-store basis.
Inventories at the end of the quarter rose 8 percent to $25.4 million, 4 percent below plan, but 3 percent higher than last year.
“We have made tremendous improvements in production,” Manny?Mashouf, chairman and chief executive, said on a conference call. “We are experiencing a smaller percentage of late deliveries and those are getting smaller and smaller.” He said he was confident that within the next 60 days, Bebe will have worked through many of the delivery difficulties.
Bebe has reported positive comps since April and is expected to report a mid-single-digit comp increase in July.
The company also said it is anticipating earnings for the first quarter in the range of 18 to 21 cents a share, compared with consensus estimates of 21 cents, and comps to be in the low-single digits. Gross margins are expected to be lower for the next three quarters, but higher in the fourth quarter.
As the retailer heads into fall with momentum behind it, Mashouf said the stores will have a better balance between day and nightwear and high fashion.
In 2003, earnings fell 27.2 percent to $19.3 million, or 74 cents a diluted share, versus income of $26.5 million, or $1.02, in 2002. Sales climbed 2.3 percent to $323.5 million versus $316.4 million.
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