Restoration Hardware sales soar 38.3% in quarter
Larry Thomas -- Home Accents Today, June 18, 2013
CORTE MADERA, Calif. - Restoration Hardware said first-quarter revenues jumped 38.3% as the retailer cut its net loss to $161,000.
The first-quarter numbers included a comparable-store sales increase of 41% that came on top of a 26% increase in the same quarter last year.
"We are extremely pleased with our first-quarter performance and financial results," said CEO Carlos Alberini, who said the company recorded "a significant improvement in profitability as we continued to invest in our infrastructure and new businesses to support our growth."
Total revenues for the quarter ended May 4 were $301.3 million, up from $217.9 million in the same quarter last year.
Of that total, $142 million came from catalog sales in the most recent quarter.
The net loss put the company on a break-even basis for earnings per share in the most recent quarter. In last year's first fiscal quarter, which was completed while Restoration Hardware was still a private company, the net loss was $3.73 million.
The company ended the quarter with 70 Restoration Hardware Galleries, three Baby and Child Galleries, and five of its new format Full Line Design Galleries.
Alberini said the company has identified 50 markets that could support Full Line Design Galleries, and is in lease negotiations in more that 30 of those markets, including New York, Chicago, Miami, Denver, Nashville, New Orleans and San Diego.
"We are receiving overwhelming support and interest from the landlord community, with offers for leases with more favorable terms that are typically available only to anchor tenants in several of the most prestigious shopping centers in North America," Alberini said. "We believe that over time, these new deals will enable us to deliver higher sales and increased earnings, reduce our capital investment, and achieve higher ROIC (return on invested capital)."
The retailer also increased revenue and earnings estimates for the fiscal year ending Feb. 1. It's now projecting revenues of $1.47 billion to $1.51 billion - up from an April forecast of $1.42 billion to $1.45 billion - and adjusted net income of $55.8 million to $58.2 million.
The April forecast called for net income of $51 million to $54 million.
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