Coldwater: could have been worse

Apparel cataloger/retailer Coldwater Creek (Nasdaq: CWTR) reported a 16% decline in fourth-quarter net sales, to $116.6 million from $139.0 million in fiscal 2000. But given that the Sandpoint, ID-based company mailed nearly 40% fewer catalogs than it had the previous fourth quarter, the decline wasn’t unexpected. Net sales from the direct channel decreased 27%, to $93.2 million, compared with $126.9 million last year.

The net loss for the quarter was $2.5 million, compared with net income of $800,000 the previous fourth quarter. Gross profit for the fourth quarter was $41.1 million, or 35% of net sales, compared with $56.9 million, or 41% of net sales, for the fiscal 2000 fourth quarter.

Net sales for fiscal 2001 increased 1%, to $464.0 million from $458.4 million the previous year. That increase came despite a 12% drop in catalog circulation, to 161 million. Net sales from the direct channel decreased 6%, to $400.8 million from $424.3 million in fiscal 2000. Internet sales increased 28%, to $144.2 million from $112.9 million. Net income for fiscal year 2001 was $1.8 million, compared with $13.2 million in 2000.

“Three key elements contributed to our lower-than-anticipated net loss for the fourth quarter and enabled us to maintain profitability for fiscal 2001 as a whole: our companywide focus on cost controls, lower return rates due to quality improvements in our merchandise assortments, and increased customer response in late February,” CEO Georgia Shonk-Simmons said in a statement.

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