Charming Shoppes Inc. bounced back into the black in the first quarter as better gross margins and lower restructuring costs overcame a 6.2 percent drop in sales.
Net income at the parent company of Lane Bryant and Fashion Bug tallied $3.9 million, or 3 cents a share, and compared with a net loss of $6.6 million, or 6 cents, a year earlier.
Sales for the three months ended May 1 fell to $504.8 million from $538.1 million. Comparable-store sales slipped 2 percent, an improvement from the 12 percent drop in the fourth quarter and the 13 percent decline in the third quarter.
Gross margins rose to 54.8 percent of sales from 53.4 percent a year earlier as restructuring charges fell to $889,000 from $8.7 million. Over the past year, the Bensalem, Pa.-based firm has reduced its store count by 144 doors to 2,128.
Jim Fogarty, who became president and chief executive officer of the firm in April 2009, told analysts on a conference call Thursday that the company had added an offense to its defensive arsenal.
“During the second half of last year and into the first quarter, we worked hard to better position our forward merchandise assortments,” Fogarty said. “And although we are not yet satisfied, we are beginning to show some progress, and most importantly, believe we better understand our customer and where to take these businesses.”
The ceo said the company was focused on improving its assortments by focusing on its customers, taking advantage of its global sourcing capabilities and making targeted investments in inventory.