NEW YORK — Bolstered by a strong performance of its core brand, Charlotte Russe Holding Inc. posted robust earnings on a 32 percent increase in net sales for the third quarter.
Results also benefited from carving out most of the Rampage stores from the balance sheet and income statement. The company said last month it was selling its Rampage stores to Forever 21 for $14 million.
For the quarter ended June 24, net income swelled 79 percent to $5.9 million from $3.3 million, on sales that climbed to $163 million from $123 million in the same quarter last year. Net income from continuing operations jumped to $8.8 million, or 36 cents a diluted share, from $3.5 million, or 15 cents, in the same period last year.
Same-store sales at Charlotte Russe stores showed an 18.2 percent gain in the quarter, which compares to a decrease of 2.5 percent for the third quarter of 2005. This marks the fourth consecutive quarter that comps rose for the Charlotte Russe stores.
The young women’s specialty retailer said last month that it will sell 44 of its 64 Rampage stores for $14 million, and convert four of the stores into Charlotte Russe locations. Twelve stores will go back to the landlords.
“This transaction, and the associated gain on sale, will be recognized in our fourth quarter ended September 20, 2006, with the 44-store transfer expected to be completed by the end of July 2006,” said Mark Hoffman, chief executive officer of the company, in a statement.
Charlotte Russe plans on opening 40 new stores for fiscal 2006 and at least 50 stores for 2007.