NEW YORK — Double-digit comparable-store sales gains helped Barneys New York Inc. find its way back into the black for the first quarter.
For the three months ended May 1, the high-end retailer reported earnings of $3.5 million, or 25 cents a diluted share, compared with a loss of $1.2 million, or 9 cents a share, in the corresponding period a year earlier.
Sales jumped 23.5 percent to $112.8 million from $91.4 million. Comparable-store sales increased 22 percent, marking the company’s fourth consecutive quarter of positive comps.
“Obviously, when you have a 22 percent comp-store increase, it means most of the categories are doing exceptionally well,” Howard Socol, chairman, president and chief executive officer, told WWD on Monday, citing particularly strong performances in the designer, Barneys New York collection and the Co-op divisions that carry contemporary designers.
“To me, there are two really great businesses happening out there in retail land and they are the luxury business and the contemporary business,” continued Socol. “We’re very happy that we are in both of them and that we’ve really expanded our Co-op businesses over the last three years so we could take advantage of that. Besides apparel, it’s also been a phenomenal shoe [season] and it’s been the spring of the handbag.”
Socol, in a statement, said the retailer continues to improve its existing store productivity with ongoing renovations and expansions at its flagship stores on Madison Avenue and in Beverly Hills. Sales growth at its premier New York, Beverly Hills and Chicago locations, along with the Co-op stores in New York and Miami, exceeded the company’s overall gains.
Selling, general and administrative expenses rose to $42.2 million from $37.7 million, a 500 basis-point increase to 46.3 percent of sales compared with 41.3 percent reported in the year-ago quarter.
Yet, Socol remains realistic about the second quarter. “I can’t imagine it can continue at this level,” he said in the interview. “I’ve been around more than five or 10 years, and I’ve never experienced a quarter where you have a 22 percent comp-store sales increase. This is really extraordinary. So far, May has started off well and we continue to be cautiously optimistic.
“I think it really depends on the consumers’ mental health,” he continued. “The fashions are right on and people feel good about them. Our inventory is the freshest it’s ever been. I think with a presidential election happening that the current administration is going to try to make the economy very buoyant.”
As part of its expansion plans, a fourth Co-op store is slated to open on Manhattan’s Upper West Side in September 2004, and another, in Chicago, in February, as noted. Another two Co-ops are slated to open within six weeks of the Chicago store in yet-to-be-disclosed locations.
— With contributions from Ross Tucker