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June 8, 2010
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Retail Ventures Inc. (RVI) posted fiscal 2010 first-quarter results after the closing bell on Monday. The company recorded a narrower GAAP net loss of $6 million, compared to a loss of $33 million in the year-ago period. Excluding special items, adjusted earnings per share came in at 46 cents, compared to an adjusted loss of $1.09 per share in the prior year quarter.
During the quarter, Retail Ventures posted a solid 16.5% growth in net sales to $449.5 million from $385.8 million in the year-ago period. The growth was mainly attributable to a 16.2% increase in comparable store sales.
Retail Ventures’ gross profit grew 23.6% year over year to $208 million, while gross margin expanded 270 basis points (bps) to 46.3% primarily due to prudent inventory management. Selling, General and Administrative expenses declined 25.8% year over year to $159.6 million mainly due to a significant reduction in bad debt expense. Accordingly, the company swung to an operating income of $17.1 million, compared to a loss of $48.1 million in the year-ago period.
Retail Ventures exited the quarter with cash and equivalents of $158.7 million and a long-term debt-to-capitalization ratio of 24.1%, compared to cash balance of $103.3 million and a long-term debt-to-capitalization ratio of 26.1% in the year ago period. During the quarter, the company generated $18.4 million of cash from operations and deployed $7.5 million towards capital expenditure.
Retail Ventures is a holding company and operated 311 shoe stores across 39 states in the U.S. as of May 1, 2010 under its wholly-owned subsidiary DSW Inc. (DSW). DSW also supplies shoes, under supply arrangements, to 354 locations for other non-related retailers in the U.S and operates the website dsw.com.
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