Destination Maternity Inc. said Wednesday that it more than doubled its second-quarter net income as the company raised its full-year guidance and appointed Chris Daniel its new president.
For the three months ended March 3, the Philadelphia-based retailer recorded a profit of $5.6 million, or 43 cents a diluted share, compared with income of $2.6 million, or 21 cents a share, a year earlier. Net sales rose 2.1 percent, to $133.8 million from $131.1 million in 2010. Analysts anticipated EPS of 34 cents on sales of $135.9 million, according to Yahoo Finance.
Same-store sales for the period decreased 0.9 percent, as gross margin edged up slightly to 55.4 percent of sales from year-ago margin of 54.4 percent.
“We are focused on continuing to turn around our sales performance through initiatives to continue to enhance our merchandise assortments, merchandise presentation and customer experience,” said Ed Krell, president and chief executive officer, who noted that the company “may be seeing some initial signs of this turnaround.”
According to the ceo, part of the company’s push to turn around the brand involves the “significant expansion” of its maternity apparel lease department relationship with Macy’s Inc., expanded to 632 Macy’s locations from 115 locations in February.
The retailer said it experienced a “slower-than-planned ramp-up of sales” at Macy’s but remains optimistic about the “sales potential” of this initiative.
For the six months, net income grew to $10.8 million, or 83 cents a diluted share, versus income of $3.9 million, or 31 cents a share, in the year-ago period. Sales rose 1.6 percent to $269.3 million from $264.9 million.
As president, Daniel, former president of Hot Topic Inc.’s Torrid division, succeeds Krell, who became interim president when Emilia Fabricant left in August to become president of Bebe Stores Inc. Daniel’s appointment is effective June 1.
The company increased its 2011 earnings estimate to $1.90 to $2.09 a share after raising the projection to a range of $1.81 to $1.99 in January. The retailer also said it anticipates third-quarter EPS of 72 cents to 83 cents on sales of $149 million to $154.5 million. Analysts previously had projected third-quarter EPS of 86 cents on sales of $155.1 million, and annual income of $1.96 a share on sales of $561.8 million.