Direct Sales Shoot Up at The Talbots
Second-quarter direct marketing sales for Hingham, MA-based apparel cataloger/retailer The Talbots exploded 56%, to $95.0 million, for the three months ended July 29, due in large part to the company’s acquisition in May of women’s apparel merchant J. Jill Group. Total sales for the quarter increased 27%, to $571.4 million. Talbots same-store sales rose 1%, but same-store sales for J. Jill fell 8%. Total retail sales increased 4%, to $404 million.
But while the J. Jill acquisition helped the top line, it hurt the bottom line. The company reported a net loss of $3.9 million for the quarter. The loss includes acquisition costs related to the $517 million purchase. For the second quarter of 2005, Talbots had posted income of $18.9 million.
“Our second-quarter results were positively driven by strong sales of our core Talbots brand apparel, which started to gain traction in early April,” CEO Arnold Zetcher said in a statement. “We saw particularly strong selling trends across all Talbots brand channels throughout June and July, which offset much of the softness in sales of our J. Jill brand merchandise during the quarter.”
Net Income Slips at Charming Shoppes
Second-quarter net income for Bensalem, PA-based women’s apparel merchant Charming Shoppes declined 17%, to $32.6 million for the three months ended July 29. On the plus side, net sales increased 11%, to $763.4 million. Net sales for the direct-to-consumer segment, consisting primarily of the Crosstown Traders brands, were $92.3 million. Retail sales rose 5%, to $671 million. Acquired last year, Crosstown Traders includes the Brownstone Studio, Coward Shoe, Lew Magram, and Old Pueblo Traders catalogs.
Tough Quarter for Eddie Bauer
Second-quarter direct sales at Redmond, WA-based Eddie Bauer Holdings fell 3%, to $57.8 million for the three months ended July 1. Total revenue for the second quarter dropped 7%, to $225.7 million from $243.8 million a year ago. Same-store sales fell 6%.
Compounding the bad news, the apparel cataloger/retailer reported a net loss of $42.0 million, compared with net income of $69.5 million for the comparable period of 2005. Last year’s black ink had resulted from a pretax gain of $107.6 million related to Eddie Bauer’s emergence from bankruptcy.
“While we are disappointed with our second-quarter performance, we are looking forward to the upcoming introduction of our new fall product line in our stores, in our catalogs and online,” CEO Fabian Mansson said in a statement. “The collection has been revamped to be more consistent with our core customers’ preferences and Eddie Bauer’s heritage as an outdoor lifestyle brand. While we believe it will take some time to realize the full impact of the changes we have been making, and the consumer environment remains uncertain, we believe there are a number of opportunities ahead to leverage the strength and unique positioning of the Eddie Bauer brand.”
Golfsmith Sales Rise 11%
Austin, TX-based Golfsmith International Holdings reported an 11% rise in second-quarter net revenue, to $114.1 million for the three months ended July 1. Same-store sales rose 3%.
But the cataloger/retailer also reported a wider net loss for the quarter: $7.9 million, compared with $6.0 million for the second quarter of last year. The loss includes charges of $12.8 million toward the company’s long-term debt, which was retired with proceeds raised in the company’s initial public offering on June 20, and $3.0 million of expenses related to the termination of a management consulting agreement with First Atlantic Capital.
“We are pleased with our overall financial results for the second quarter, particularly in light of the relatively soft retail demand we experienced the last few weeks of the quarter,” CEO Jim Thompson said in a statement. “Sales were driven by double-digit increases in key categories such as clubs, apparel, and services. We also made meaningful progress executing several strategic growth initiatives, such as opening new stores and renovating existing locations, launching our loyalty program, and expanding our tennis and private-label offerings.”