Jo-Ann Stores profits up by 7.1 percent
March 15, 2004-- Home Textiles Today,
Helped by stronger sales, wider margins and lower interest costs, fabric and crafts retailer Jo-Ann Stores Inc. drove fourth-quarter profits up by 7.1 percent, to $27.1 million from $25.3 million last year.
Sales increased by 5.1 percent, to $552.6 million from $525.8 million. Same-store sales grew by 4.5 percent, up against a tough comparison with a same-store gain of 6.9 percent the preceding year.
Acting as a prop to the bottom line, average gross margin improved by 60 basis points, or six-tenths of a percentage point, to 43.9 percent from 43.3 percent. Fueling the margin growth was "a less promotional pricing strategy," the company said. Operating costs held relatively steady at 32.2 percent, up slightly from 32.1 percent.
In another lift to profits, the specialty retailer knocked its interest costs down by 28.8 percent, to $4.2 million from $5.9 million last year, generating a savings of $1.7 million. Debt levels were slashed by more than half, or 57 percent, to $49 million from $114 million.
During the year, Jo-Ann opened 16 superstores, converted four larger traditional stores to the superstore format, and opened three traditional stores. The company shuttered 45 traditional stores and a superstore. This year, Jo-Ann plans to open about 30 new superstores, while closing about 70 smaller traditional stores.
Jo-Ann Stores Inc.
|Qtr. 1/31 (x000)||2003||2002||% chg|
|a-Fourth-quarter results include $1.6 million in stock option compensation expense and $900,000 in debt repurchase and share reclassification expenses.
b-12-month results include $5.7 million in stock option compensation expense; and $5.5 million in debt repurchase and share reclassification expense vs. $1.9 million last year.
|Oper. income (EBIT)||64,400||58,800||9.5|
|Per share (diluted)||1.22||1.15||6.1|
|Average gross margin||43.9%||43.3%||--|
|12 months||2003||2002||% chg|
|Oper. income (EBIT)||144,400||142,400||1.4|
|Per share (diluted)||1.86||2.08||-10.6|
|Average gross margin||46.7%||46.2%||--|