NEW YORK — Nautica’s licensed women’s line may not be an unqualified smash, but the company has little else to complain about.
Profits at Nautica Enterprises Inc. grew 35 percent in the fourth quarter ended Feb. 28 to $11.3 million, or 26 cents a share, from $8.4 million, or 20 cents, a year ago.
Per share figures have been adjusted to reflect a 2-for-1 stock split in the form of a 100 percent stock dividend issued on May 28.
Sales in the latest quarter rose 30 percent to $90.5 million from $69.7 million.
According to executives in a quarterly conference call with analysts, licensing royalties grew in the quarter, with particular strength in boys’ wear, fragrances, footwear and international business.
Its women’s business, licensed by Bernard Chaus Inc., however, remains a bit choppy. Harvey Sanders, chairman and chief executive officer, said during the call that the response to the latest women’s wear has been good, but he added, “Business is just OK right now. The execution at the retail level, in terms of the in-store shops and the matrix of product in the stores, has to be improved.”
Sanders said that overall bookings are up 25 percent for fall, with sportswear looking “very, very strong.”
In the full year, profits jumped 38 percent to $44 million, or $1.02, from $32 million, or 75 cents. Sales grew 28 percent to $386.6 million from $302.5 million.
Gross margins grew to 46.8 percent of sales in the quarter from 45.3 percent. Selling, general and administrative expenses as a percentage of sales increased to 29.9 percent from 29.4 percent, reflecting increased marketing and retail development costs. Inventories at that quarter’s end were up 13 percent to $61.3 million against $54.2 million, and the company’s cash balance rose to $71.9 million from $61 million. Receivables were up to $60.6 million from $45.7 million.
Sanders said the company plans to open 150 in-store shops in fiscal 1998 and 90 to 125 in-store shop expansions. The firm has 60 Competition in-store shops open, with plans for 120 to 130 shops by the end of calendar 1997.
Nautica has 1,072 in-store shops in major department store chains.
Nautica opened two outlet stores this year raising the total to 51. Another six to eight outlets are scheduled to open by yearend. Sanders noted that the outlet stores had a “good quarter” with same-store sales up but “not as substantially as in the past.” He blamed a tough retail climate since the start of the year and colder than normal weather in the Northeast.
“The summer period is when the outlet stores have their best quarters,” he added. Sanders noted that the company added two stores in 1996 and said the two stores opened this year are doing well.
In response to an analyst’s question on the possibility of opening another flagship, Sanders said the company is “always looking.”
“Today the rents are a little high for us,” he said, referring to prime locations such as Madison Avenue and Fifth Avenue. The company’s only flagship is at 70th Street and Columbus Avenue here.
The firm recently announced that it signed 1997 NBA All-Star Game MVP Glen Rice as a spokesman for its Competition line of performance athletic apparel and footwear brand.

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