Jo-Ann cuts outlook as home fabrics slide
December 4, 2008-- Home Textiles Today,
Hudson, Ohio – Home décor fabric was one of the “negative categories” in the third quarter for craft and fabric retailer Jo-Ann Stores.
The 768-store company reported third quarter net income of $10.2 million, improved from $8.0 million in the year-ago period. Sales were flat at $480.1 million, while comps edged down 1.5%.
Jo-Ann has made strides in cutting its SG&A costs, according to James Kerr, evp and cfo, who also told analysts that the chain’s small-format stores, in the majority at 560 units, have greatly outperformed the large format models in year-to-date comps.
Touching on the slowdown in sales of home décor fabric, Kerr also noted that Jo-Ann is at least matching its competitors in discounting “earlier, deeper” in seasonal goods, which remains the retailer’s toughest category.
Jo-Ann now projects flat comp sales for the full year, down from previous guidance of a 2.0% - 3.5% comp gain. Earnings per share are now foreseen in the range of 75-85 cents, vs. earlier guidance of 95 cents to $1.05.
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