LANDS’ END EARNINGS UP 12.3% IN QUARTER
Byline: Vicki M. Young
NEW YORK — Finishing a difficult year on a good note, Lands’ End reported that net income for the fourth quarter grew at a double-digit clip and beat Wall Street estimates by a penny.
For the quarter ended Jan. 26, net income was up 12.3 percent to $31.8 million, or $1.07 a diluted share, from $28.3 million, or 92 cents, in the same year-ago period. A poll of analysts by tracking firm First Call/Thomson Financial pegged the earnings at $1.06.
Sales in the quarter were up 11.5 percent to $538.6 million from $483.1 million. The company said that sales in the month of January were up 6 percent even though it shifted about $10 million in sales out of the quarter and into the subsequent first quarter of fiscal 2002 due to a change in the timing of the end-of-season clearance catalog.
David F. Dyer, president and chief executive officer, said in a statement, “We are extremely pleased that our strategic initiatives of the last two years have resulted in a double-digit increase in both sales and earnings for the fourth quarter. Our merchandising, creative and marketing decisions really paid off. During the latter part of the year, we generated great sales momentum and ended fiscal 2001 with the strongest growth in our 12-month buyer file that we’ve had in years. This was especially gratifying in the face of a difficult economy.”
For the year, net income was down 27.8 percent to $34.7 million, or $1.14 a diluted share. The year-ago results include a non-recurring after-tax credit to net income of $1.1 million, $1.8 million on a pre-tax basis or 4 cents a share. Sales were up 3.2 percent to $1.5 billion.
Lands’ End said that for the first five weeks of the current first quarter, total revenue is up 19 percent, mostly due to the shift in the clearance catalog. While the company said it is taking a conservative approach to business because of the uncertainty in the U.S. economy, sales for the year that ends Feb. 1, 2002 are expected to increase in the single-digit range. The corresponding bottom line is projected to be an increase in diluted earnings per share of at least 20 percent for the year.
Growth was fueled by the core business segment, led by the co-ed division which grew by 23 percent in the quarter and 16 percent for the year. The corporate sales area was the strongest performer in the specialty business, coming in at double-digit increases throughout the year with sales of $170 million in fiscal 2001. The kids division posted a low-double-digit sales increase in the quarter and the Coming Home catalog arm showed mid-single-digit sales growth.