Stage Stores Sales Jump in Q4, but Not as High as Analysts Expected

Andrew Klips |

Stage Stores, Inc. (SSI) reported a jump in fourth-quarter earnings as the retailer posted record revenue and same-store-sales clocked their biggest percentage gains in more than a decade that more than offset an increase in expenses.

Stage stores operates mostly in smaller cities at retail locations under the brands Bealls, Goody’s, Palais Royal, Peebles, Stage and Steele, which offer moderately priced brand name apparel, footwear, accessories and cosmetics. The company ended the latest quarter with 864 stores in 40 states, including the addition of 56 new locations in 2012.

For the quarter, the Houston, Texas-based company reported $527.9 million in net sales, up from $479.1 million in the year prior quarter, although the recent quarter included 14 weeks versus 13 weeks in the week ended January 28, 2012. Net income for the recent quarter was $35.8 million, or $1.09 per share, up from $32.7 million, or $1.05 per share, in the year back quarter.

Although higher than the previous year’s quarter, the figures were short of Wall Street expectations of $1.16 per share in profits on revenue of $528.9 million.

Selling, general and administrative costs increased 16 percent during Q4 2012 compared to Q4 2011 to $112.8 million, but were tepidly counterbalanced by a drop of 35 percent in interest expenses to $661,000 from $1.01 million in the year prior quarter.

Michael Glazer, President and Chief Executive Officer of Stage Stores still called the 2012 year “phenomenal,” particularly noting “a 5.7% increase in comparable store sales, the highest percentage increase in over 10 years.”

For the full fiscal year 2012, ended February 2, 2013, net sales were $1.65 billion, including the extra week, ahead of $1.51 billion in 2011. Excluding one-time items, adjusted income was $42.6 million, or $1.33 per share, compared to $31.0 million, or 92 cents per share for the year earlier.

Direct-To-Consumer sales increased 65 percent versus 2011.

Looking ahead, Stage said it sees adjusted earnings in the range of $1.45 to $1.55 for the full 2013 year and an increase in same-store-sales between 2 percent to 4 percent. Total sales were guided in the range of $1.69 billion to $1.72 billion. Analysts were anticipating EPS of $1.51 on $1.74 billion in sales.

The company also said that it plans to open 40 new stores in 2013 and continue its process of consolidating its department store operations into its Houston corporate headquarters, a move it projects to save them $5 million annually. Glazer also said that the company has beefed-up its inventory to take advantage of several opportunities and expects “meaningful sales and earnings growth” going forward.

Shares of SSI closed trading on Monday at $26.83, ahead about 70 percent in the past 52 weeks. In early trading on Tuesday, shares are trading basically flat.

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Companies

Symbol Name Price Change % Volume
GXP.P.E Great Plains Energy Inc. Pfd 4.50% n/a n/a n/a 0
SSI Stage Stores Inc. 5.59 -0.09 -1.58 170,542

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