Cutter & Buck Second Quarter Sales Increase 50% and Profits Rise 43%, Reflecting Solid Growth in All Channels
SEATTLE, Wash.--(BUSINESS WIRE)--Dec. 10, 1998--Cutter & Buck Inc. (NASDAQ:CBUK - news) today announced 50% growth in net sales and 43% higher earnings for its second quarter ended October 31, 1998. Fiscal 1999 second quarter net sales increased to $26.0 million, up from $17.3 million reported in the second quarter of fiscal 1998. Second quarter net income increased 43% to $1.7 million, or $.29 per diluted share, compared to $1.2 million, or $.21 per diluted share, for the like quarter last year. For the first half of fiscal 1999, Cutter & Buck's net sales increased 47% and profits increased 50%, compared to the like period a year ago. The company earned $2.5 million, or $.43 per diluted share, on sales of $43.8 million during the first six months of fiscal 1999 compared to $1.6 million, or $.30 per diluted share, on sales of $29.7 million for the like period a year ago.
''We've worked hard and invested heavily over the past few years to build brand strength in our key markets. That strategy continues to pay off in our strong top and bottom line performance,'' said Harvey Jones, Chief Executive Officer. ''Cutter & Buck has become a powerful brand by excelling in a combination of niche markets. Now our new flagship store is exhibiting our full men's and women's fashion collections, which is a critical step forward in reaching out to a broader consumer base. I'm very pleased with this new venture and with our brand building in all the markets that we serve.
''Additionally, we are pleased to introduce an exciting new line of Cutter & Buck golf shoes for men and women,'' added Jones. ''We believe these shoes, which will be presented at the PGA Merchandise Show in January, will offer the Cutter & Buck consumer a new standard of fashion, fit and performance.''
During the second quarter of fiscal 1999, gross profit margin increased to 42.1% from 41.2% for the like quarter last year. For the first half of fiscal 1999, the gross profit margin improved to 42.4% from 40.7% in the like period of fiscal 1998. During the second quarter, operating expenses as a percentage of sales increased as expected to 32. 3% of sales from 30.9% in the same quarter last year.
''Sales continue to advance as consumer awareness of the Cutter & Buck brand, quality, and classic style has expanded. This momentum is reflected across all channels of distribution as new accounts come on board and order sizes increase,'' said Martin J. Marks, President and Chief Operating Officer. ''The increase in operating expenses in relation to sales reflects the Company's strategic investments in marketing, information technology, product development and retail initiatives. These initiatives are aimed at positioning Cutter & Buck for long-term growth as a premiere sportswear brand.''
Statements made in this news release that are not historical facts are forward looking information. Actual results may differ materially from those projected in any forward looking information. Specifically, there are a number of important factors that could cause actual results to differ materially from those anticipated by any forward looking information. Those factors include, but are not limited to, style changes and product acceptance, relations with suppliers and independent sales representatives, the ability of the Company to control costs and expenses, the ability of the Company to carry out successful design and planned product and brand extension activities and to penetrate its chosen distribution channels, competition, foreign currency risks, risks associated with opening and operating a retail location, the successful implementation of the Company's Year 2000 compliance initiative, political and trade relations and general economic conditions. Additional information on these and other factors which could affect the Company's financial results are included in its Securities and Exchange Commission filings. Finally, there may be other factors not mentioned above or included in the Company's SEC filings that may cause actual results to differ materially from any forward-looking information.
Cutter & Buck designs, sources and markets updated traditional sportswear and outerwear. It distributes its products both domestically and internationally, predominantly through golf pro shops and resorts, better specialty stores and corporate sales accounts. The company has developed a colorful, innovative collection of high-quality sportswear targeted to the upscale apparel market, projecting an updated American traditional design evocative of a sporting lifestyle. |
