Burlington 3Q profits up 3.9%
April 16, 2001,
BURLINGTON, NJ — With margins gaining strength on a lower level of markdown activity, and getting another lift from deep cuts in interest expense, Burlington Coat Factory Inc., parent of Luxury Linens, reported a third-quarter profit of $36.1 million, up 3.9 percent from $34.8 million.
Burlington Coat is parent to Luxury Linens, the nation's 16th largest home textiles retailer with about $211.8 million in 1999 home textiles sales.
In a boost to the bottom line, average gross margin widened by 120 basis points, to 34.8 percent from 33.6 percent the prior year. Gross margin dollars improved by 9.2 percent, to $471.0 million from $456.2 million last year. The strong improvement, the company said, "was primarily due to a lower level of markdowns compared with the prior year. After a strong sell-through in December, the need for promotional activity after Christmas was less than that of the previous year."
Offsetting the strength in margins, operating costs climbed higher by 130 basis points, rising to 26.4 percent from 25.1 percent a year ago.
In a big seven-figure savings, Burlington slashed its interest expense by 89.3 percent, to just $141,000 from $1.3 million last year, a move that saved the company $1.2 million during the quarter.
BURLINGTON COAT FACTORY INC.
|Qtr. 3/3 (x000)||2001||2000||%CHG|
|Oper. income (EBIT)||58,012||56,409||2.8|
|Per share (diluted)||0.82||0.76||7.9|
|Average gross margin||34.8%||33.6%||—|
|Oper. income (EBIT)||113,867||92,709||22.8|
|Per share (diluted)||1.58||1.20||—|
|Average gross margin||36.3%||35.6%||—|
a-Nine-month results include a one-time charge of $815,000 stemming from the early retirement of debt.
b-Results in the year-ago period include a $1.4 million non-cash charge stemming from a change in accounting.