NEW YORK — With lower sales but expectations of higher earnings, Mayor’s Jewelers Inc. discovered that less really is more in the first quarter.
This story first appeared in the July 28, 2003 issue of WWD. Subscribe Today.
For the 13 weeks ended June 28, the Sunrise, Fla.-based jewelry retailer reported preliminary sales of $24.5 million. While that represents a 16.9 percent decrease from last year’s sales of $29.5 million, the company achieved those results operating 14 fewer stores in a shorter selling period, or 28 stores over 13 weeks versus 42 stores over 14 weeks in the year-ago quarter.
Adjusting sales for a year-over-year 13-week comparison, sales decreased a more modest 8.6 percent from $26.8 million a year ago. Moreover, on a 13-week basis, comparable-store sales rose 14 percent.
Coupled with a 740 basis-point expansion in gross margin to 40.4 percent of sales from 33 percent a year ago, Mayor’s said it expects to report a significant decrease in its net loss for the quarter compared with last year’s loss of $8.4 million, or 43 cents a diluted share. The company said it will release full financial results on or before Aug. 12.
“Given that our increase in comparable-store sales rose monthly and across all markets,” said chief executive officer Thomas Andruskevich in a statement, “and given the success of our strategy of increasing gross margin and reducing operating expenses, we have reason to believe Mayor’s is on the road to recovery.”
Mayor’s added that first-quarter operating expenses decreased principally due to fewer stores in operation over the prior-year period. Gross margin also benefited from easy comparisons to last year when the firm had to heavily discount merchandise in stores slated for closure.