NEW YORK — Pacific Sunwear of California Inc. shone brightly in the first quarter as earnings vaulted nearly 90 percent.
For the three months ended May 1, the Anaheim, Calif.-based teen and young adult retailer said net income jumped 87.7 percent to $15 million, or 19 cents a diluted share, which beat Wall Street’s estimate by 2 cents. By comparison, last year PacSun had profits of $8 million, or 10 cents.
Sales for the quarter increased 23.6 percent to $245.1 million from $198.3 million a year ago, and same-store sales advanced 12.7 percent. Torrid same-store sales have allowed PacSun to leverage its costs, amplifying the effect of top-line growth on bottom-line gains.
“For PacSun, we achieved strong double-digit same-store sales growth in footwear and accessories and high-single-digit comparable increases in guys’ and low-single-digit increases in girls’ apparel,” said chief executive officer Greg Weaver in a statement. “We achieved a 6 percent same-store sales increase in our Demo chain. Girls’ apparel, accessories and footwear have been the comp drivers in Demo, while mens’ were down mid-single-digits.”
In an impressive run of same-store sales, PacSun has posted double-digit comp gains every month since November and hasn’t recorded a negative month of comps in more than two years.
“PacSun is growing into a multidimensional category killer,” said Wachovia Securities analyst Joseph Teklits in a research note last week following the company’s report of an 11.4 percent rise in April same-store sales.
In conjunction with its earnings release, PacSun said it completed its $50 million stock repurchase program and intends to buy up to an additional $25 million worth of shares. Given the company’s robust first-quarter results and the reduction in share count from the repurchase, PacSun increased its full-year guidance to $1.31 a share from the current consensus estimate of $1.26.