Stage Stores (SSI), a specialty retailer, has recorded a 16.50 percent increase in profit for the quarter ended Aug. 02, 2014. The company earned $11.19 million or $0.35 a share in the second-quarter compared with $9.61 million or $0.29 a share a year ago. Analysts on average had predicted net income of $0.53 a share.
Revenue during the second-quarter slipped 3.22 percent to $377.45 million from $389.99 million in the last year period.
Gross margin expanded by 13 basis points over the previous year period to 29.76 percent. Total expenses as a percentage of revenues decreased to 94.96 percent from 95.39 percent in the same period last year. That has resulted in improvement of 43 basis points in operating margins to 5.04 percent.
The company disclosed operating income of $19 million, compared with $17.96 million in the last year period.
Michael Glazer, president and chief executive officer, stated, ''We found the second quarter to be challenging, but we were encouraged that our sales trend improved towards the end of the quarter. We were pleased with the performance of our back-to-school categories as well as cosmetics, which delivered another strong quarterly performance. We managed our merchandise margins and inventory well and feel good about forward looking inventory levels and content. We expect improved second half results given our sales driving initiatives.''
Cash Flow
Stage Stores has spent $2.09 million cash to meet operating activities during the first half, as against cash outgo of $0.83 million in the last year period.
The company has spent $28.84 million cash to meet investing activities during the first half, as against cash outgo of $29.93 million in the last year period. It has made net capital expenditure of $28.84 million during the first half, which was lower by 3.64 percent or $1.09 million, from a year ago.
The company has generated cash of $42.26 million from financing activities during the first half, down 10.02 percent or $4.70 million, when compared with the last year period. It has borrowed net of $408.38 million through debt during the first half. It has raised net of $7.03 million by selling common stocks.
The company's cash dividend payment increased 7.64 percent or $0.57 million to $7.97 million.
As on Aug. 02, 2014, the company's cash balance stood at $26.09 million, down 23.58 percent or $8.05 million from Aug. 03, 2013.
Working Capital
Stage Stores has witnessed an increase in the working capital over the last one year. The company's working capital stood at $330.65 million as at Aug. 02, 2014, up $20 million or 6.44 percent from $310.64 million on Aug. 03, 2013. It registered an increase in current ratio to 2.69 as at Aug. 02, 2014 from 2.48 on Aug. 03, 2013.
Debt Position
Stage Stores has witnessed an increase in long-term debt over the last one year. As on Aug. 02, 2014, long-term debt stood at $107.42 million, up 90.99 percent or $51.18 million, from Aug. 03, 2013. The company's total debt was 12.70 percent of total assets as on Aug. 02, 2014, compared with 6.61 percent on Aug. 03, 2013.
