NEW YORK — Spot-on fashion and well-managed inventories more than doubled AnnTaylor Stores Corp.’s first-quarter earnings on a 17 percent sales gain.

For the quarter ended April 29, the specialty retailer’s net income rose to $39 million, or 53 cents a diluted share, from $17 million, or 24 cents, in the prior year on sales that climbed to $556.2 million from $476.4 million.

Same-store sales gained 5.6 percent. By division, Ann Taylor’s comps showed a 7.4 percent increase while Ann Taylor Loft gained 4.7 percent. The gross margin rose to 56.66 percent in the quarter, which compares with 51.03 in the prior year. The company said total inventories were down 19 percent by the close of the quarter, which is on a per-square-foot basis, year-over-year.

Kay Krill, president and chief executive officer, said in a statement that the company has worked diligently over the past year to execute “initiatives designed to deliver profitable growth by providing our client with brand-appropriate and trend-right product while carefully managing our inventory. In the first quarter we did just that at both Ann Taylor and Loft.”

Due to the strong results, Krill said the company is “raising our annual earnings per share guidance by [10 cents] per diluted share.”

During the conference call with analysts, Krill said “the assortment in each division was brand-appropriate with the right balance of end use and the right color focus.”

“As you know, one of our primary objectives over the last year or so has been to more clearly differentiate our brand,” Krill explained. “Based on the branding work we did in early 2005, we are definitely seeing the impact of these efforts.”

Krill said all regions, volume groups, store types and divisions delivered positive same-store sales during the quarter. “At the same time, our improved inventory position contributed significantly to our higher gross margins and earnings growth,” she added.

During the quarter, Krill said holiday selling was particularly strong. President’s Day weekend and Easter reached a five-year high. “In fact, the Saturday before Easter, this year, was bigger than Black Friday in sales,” Krill said, “underscoring the fact that our client comes to us for her Easter wardrobing needs.

This story first appeared in the May 22, 2006 issue of WWD. Subscribe Today.

“From a color perspective, neutrals outperformed for the quarter, led by black, brown and our ivory neutral offering,” Krill added. “Petites also had an excellent quarter, and in fact were strong in both divisions. As you know, there’s been some consolidation in this market. And this is an opportunity that we are pursuing.”