Reductions in both expenses and restructuring charges buoyed Destination Maternity Corp.’s first-quarter income and elevated the company’s shares more than 12 percent Thursday.
The maternity-clothing retailer also raised its yearly outlook Thursday to a range of $3.62 to $3.98 a share, from $3.52 to $3.87 a share. Analysts are looking for EPS of $3.79.
For the period ended Dec. 31, the Philadelphia-based company recorded income of $5.2 million, or 81 cents a diluted share, compared with income of $1.3 million, or 20 cents a share. Excluding restructuring and other charges, income increased to 88 cents from 62 cents. Revenue improved 1.2 percent to $135.4 million, from 133.8 million, a year earlier. Analysts predicted EPS of 68 cents on sales of $140.2 million.
Comparable-store sales, which include Internet sales, rose 2.1 percent, while gross margin edged up to 53.9 percent of sales versus 53.6 percent, a year earlier.
“We are focused on turning around our sales performance through initiatives to continue to enhance our merchandise assortments, merchandise presentation and customer experience,” chief executive officer and president Ed Krell said on the company call. “And we are cautiously optimistic that we may be starting to see some initial signs of this turnaround, as evidenced by our positive comparable-store sales for the first quarter.”
The ceo cited its expansion into more than 500 additional Macy’s Inc. leased departments beginning next month as among its expansion vehicles for 2011, but warned that comps will be “negatively impacted” by the significant Macy’s expansion in February.
The company looks to open 12 to 19 stores this year, and plans to shutter approximately 45 to 62 stores with roughly 12 to 24 of the closings related to the opening of new multibrand Destination Maternity stores.
For the second quarter, the firm, which operates Motherhood Maternity, A Pea in the Pod and its namesake chain, said it anticipates EPS of between 64 cents and 75 cents on revenue of $134 million to $137 million. Wall Street projected 69 cents on revenue of $140.2 million, according to Yahoo Finance.
Shares of the maternity specialist ended the day at $45.47, up $4.96 or 12.2 percent. The percentage increase was the highest of the 171 issues tracked daily by WWD.