iParty Corp. Reports Fiscal 2005 Financial Results
Friday February 24, 4:30 pm ET
DEDHAM, Mass.--(BUSINESS WIRE)--Feb. 24, 2006--iParty Corp. (AMEX: IPT - News), a party goods retailer that operates 50 iParty retail stores, today reported financial results for its fourth quarter and fiscal year 2005, which ended on December 31, 2005. The Company's accounting cycle resulted in a 14-week fourth quarter and a 53-week year in fiscal 2005, compared to a 13-week fourth quarter and a 52-week year in fiscal 2004.
For the 14-week quarter, consolidated revenues were $28.0 million compared to $23.7 million for the 13-week quarter of 2004. On a comparable 13-week quarter basis for both fiscal 2005 and fiscal 2004, consolidated revenue increased 11.0% which included a comparable store sales increase of 0.8%. Consolidated gross profit margin was 47.8% for the quarter compared to a margin of 47.8% for the same period in 2004. Operating income for the quarter was $4.0 million compared to $2.9 million for the quarter in 2004. For the quarter, consolidated net income was $3.9 million, or $0.10 per basic and diluted share, compared to consolidated net income of $2.7 million, or $0.07 per basic and diluted share, for the quarter in 2004.
For the 53-week fiscal year, consolidated revenues were $72.5 million compared to $64.3 million for the 52-week fiscal year of 2004. On a comparable 52-week basis for both fiscal 2005 and fiscal 2004, consolidated revenue increased 10.2% which included a comparable store sales increase of 0.6%. Consolidated gross profit margin was 42.9% for the full fiscal year compared to 44.3% for fiscal 2004. Operating income for the full fiscal year was $0.3 million compared to $0.9 million for fiscal 2004. For the full fiscal year, consolidated net loss was $0.3 million, or $0.01 per basic and diluted share, compared to consolidated net income of $1.0 million, or $0.03 per basic and $0.02 per diluted share, for fiscal 2004.
Sal Perisano, Chief Executive Officer of iParty Corp., commented, "Overall, we are pleased with our performance in the fourth quarter which included a 42.8% increase in net income over the fourth quarter in 2004. This fourth quarter was our most profitable quarter to date. We began the quarter with a disappointing Halloween season in which comparable store sales were down by 1.1 %, but we finished the quarter with strong sales in both November and December which resulted in a comparable store sales increase of 0.8% for the comparable 13-week period. During the quarter, our product margins improved from earlier in the year and we leveraged our marketing and sales expenses and our general and administrative expenses as a percentage of sales."
"During 2005 we opened six new stores bringing our total number of stores to 50. Excluding sales from the 53rd week of the fiscal year, sales from our 50 stores, including new stores which had not been open for one full year, increased by 10.2% for the comparable 52-week period. We are pleased with our continuing ability to implement our growth strategy and increase total sales. Unfortunately, a greater-than-anticipated increase in our product costs for the first three quarters, the higher cost to sales ratio for our new stores and relatively flat comparable store sales for the year led to a full year loss of approximately $270,000."
"In 2006, we plan to focus on increasing our comparable store sales growth, improving our gross margins and leveraging our overall cost structure as the 12 new stores we opened over the past two years start to mature. At this time, we do not plan to open any new stores in 2006. Our focus in the upcoming year will instead be on infrastructure improvements designed to help support the future expansion of our business. In the meantime we intend to continue to investigate and explore potential locations for future store growth in anticipation of a resumption of our store expansion efforts in 2007. We believe that our increased focus this year on infrastructure improvements and comparable store performance, followed by the opening of new stores in 2007, will help build long-term value for our investors." |
