Delia’s grows sales, cuts loss
June 6, 2006,
New York -- Delia’s Inc., the apparel and home accessories retailer targeting the tweener market, parlayed stronger sales, wider margins and lower costs into a sharply narrowed first-quarter loss of $1.2 million, improving on a year-ago deficit of $12.5 million when the chain was awash in red ink spilled by discontinued operations.
Stanching the flow of red ink, in addition to the stronger sales, average gross margin widened by 270 basis points, or 2.7 percentage points, to 37.9% of sales from 35.2% a year ago. In another lift, costs were pared by 100 basis points, or 1.0 percentage points, to 40.5% of sales from 41.5% last year.
Saving the company even more, stockpiles were pared by 8.1%, even as sales shot up at a double-digit pace. Inventories were whittled down to $23.7 million from $25.8 million last year, saving the retailer $2.1 million.