EXPANSION HELPS TALBOTS TO 48.8% JUMP IN PROFITS INCREASE
NEW YORK — Strong expense controls and sales gains through steady expansion spurred The Talbots Inc. to a 48.8 percent profit gain in the fourth quarter ended Feb. 3.
Arnold B. Zetcher, president and chief executive officer of the rapidly growing retailer of traditional women’s apparel, called fiscal 1995 “challenging” but added that the company “quickly adapted to changing circumstances during the second half.”
He said the company’s focus on controlling spending without hindering customer service or expansion drove earnings. The specialty retailer’s latest quarter includes 14 weeks, against 13 weeks ended Jan. 28 in 1995. Last quarter, earnings grew to $13.3 million, or 39 cents a share, beating Wall Street estimates of 36 cents. Talbots stock gained 7/8 to 39 1/8 on the New York Stock Exchange Thursday.
In the year-ago quarter, Talbots earned $8.9 million, or 26 cents. Sales moved up to $298.8 million from $264.4 million. Retail sales gained 14 percent to $246 million, but same-store sales declined 2.3 percent. Catalog sales rose 10 percent to $52.8 million.
Zetcher noted that although the company has a cautious outlook for the year, Talbots plans to open 75 stores, up from 65 last year, which will bring the total to 535 at the end of fiscal ’96. The company had 460 stores at the end of fiscal ’95. The company opened five Talbots Accessory & Shoe stores last fall and plans to open 11 more in 1996. Talbots also introduced Talbots Babies in four Talbots Kids stores and in its catalog. The company plans to include Babies departments in six of seven new Talbots Kids stores in 1996 and is looking for additional space near another six Talbots Kids stores to add Babies.
In the full year, profits advanced 15 percent to $62.6 million, or $1.82, from $54.5 million, or $1.56. Sales climbed 11.5 percent to $981.1 million from $879.6 million. Retail sales increased 13 percent to $799.7 million and same-store sales edged up 1.2 percent. Catalog sales rose 5 percent to $181.3 million.
Talbots, based in Hingham, Mass., currently operates 468 specialty stores and a catalog offering women’s classic apparel, shoes and accessories.