WWD.com/fashion-news/fashion-features/pacific-sunwear-plans-retail-space-increase-738424/

LOS ANGELES — In a time when teens have clamped down on spending and retailers are slowing expansion plans, Pacific Sunwear of California said Wednesday that it will increase its retail square footage by 12 percent this year. The rise doesn’t reach last year’s increase of 14 percent, but it is higher than planned, due primarily to the strength of the girls’ business at PacSun and Demo stores.

This story first appeared in the February 27, 2003 issue of WWD.  Subscribe Today.

For fiscal 2003, PacSun plans to open 75 net new stores versus the 60 stores originally announced. The 75 net number comes from 87 new stores minus 12 planned store closings and will include 61 new PacSun stores, four new PacSun Outlets and 10 Demo stores. The Anaheim, Calif.-based retailer will continue its plan to relocate 30 stores to larger locations. Last year, PacSun added 73 stores and expanded or relocated 30 stores to larger sites.

In a phone interview, chairman and chief executive Greg Weaver said: “In a nutshell, the true strength of both concepts is female apparel.” Girls are also driving accessories and footwear.

Weaver is especially encouraged by the four-year-old Demo urban hip-hop concept, which has benefited from solid sales of girls’ Baby Phat and Lady Enyce brands. The female customer is eagerly awaiting Sean John’s girls’ line expected next spring, he said, noting that if momentum continues, “Demo can be at least a 200-store nationwide chain in the next few years, which may prove to be conservative.”

Also at Demo, Heidi Muther was promoted to vice president of merchandising and Eric Plyler was named vice president of stores. Muther has been with the company since 1996, most recently divisional merchandise manager for Demo Plyler joined PacSun in 2000 and was director of stores for Demo

PacSun, which sells surf and snowboard clothing, has seen stronger gains in same-store sales than most retailers recently. Overall, same-store sales increased 20.4 percent in January with PacSun comps up 18.7 percent and Demo same-store sales up 32.8 percent. A total of 614 PacSun stores, 72 PacSun Outlets and 107 Demo stores had sales during the first 11 months of fiscal 2002 of $802.7 million, an increase of 22.9 percent over $653.2 million for the first 11 months of fiscal 2001. PacSun will unveil fourth-quarter earnings Monday, and expects a 52 percent increase in earnings per share over last year’s fourth quarter.