Belk Inc. posted an 8.4 percent increase in net profits for the fourth quarter although full-year profits fell 7.8 percent because of higher investment spending.
For the three months ended Jan. 31, net income rose to $104.4 million from $96.3 million. Belk attributed the increase to a 5.2 percent pick-up in holiday sales for the nine-week period ended Jan. 3. Net sales rose 5 percent to $1.39 billion from $1.32 billion. Comparable-store sales gained 4.8 percent. The company said online sales rose 42.2 percent in the fourth quarter, which “positively affected” the company’s comps by 2.4 percent for the period.
For the year, net income fell to $146.1 million from $158.5 million. Belk said the decrease was due primarily to higher expenses associated with the firm’s investments in strategic initiatives during the period. Net sales increased 1.8 percent to $4.11 billion from $4.04 billion.
Belk said it invested more than $79 million in store expansion and remodeling projects last year, including the opening of flagships in Dallas and Huntsville, Ala., and a store at Denham Springs/Livingston Parish, La.
The retailer also invested $33 million to up fit its fulfillment center operations in Union County, S.C., which expanded from 500,000 square feet to 840,000 square feet. Belk plans to invest another $27.5 million to continue its build out capabilities.
Tim Belk, the department store chain’s chairman and chief executive officer, said, “Despite challenges early in the year, we ended fiscal year 2015 with strong holiday sales and are pleased to report our fifth consecutive year of positive comparable store sales….We are encouraged by the recent trends and believe we are well positioned for the year ahead.”
The company said the merchandise categories that achieved the highest growth rates last year included activewear; women’s contemporary, resort and bridge; women’s suits; men’s sportswear, and juniors.