Sharper Image Corp. Reports 27% Improvement in 1st Quarter Net Operating Results
Business Wire - May 20, 1999 07:45
SAN FRANCISCO--(BUSINESS WIRE)--May 20, 1999--Sharper Image Corporation (Nasdaq/NMS:SHRP) today reported improved net operating results and higher sales for its first fiscal quarter ended April 30, 1999.
Performance highlights include a 27 percent improvement in net operating results per share, a six percent increase in comparable store sales, a 348 percent increase in Internet sales and a 2.8 percentage point increase in gross margin rate. The Company's balance sheet continues to improve over the prior year as well with a decrease in the revolving loan facility borrowings at the end of the quarter from $7.6 million last year to zero this year.
Total revenues were $40.9 million, an increase of three percent from last year's $39.8 million. Total store sales increased 10 percent to $29.2 million from $26.5 million in the prior year, with comparable store sales increasing six percent. Internet sales of $2.3 million increased 348 percent from last year's $520,000. Catalog sales decreased 27 percent to $8.9 million from the prior year's $12.2 million. The net loss for the quarter was $1.7 million, or 19 cents per share, an improvement of 27 percent per share from last year's loss of $2.2 million, or 26 cents per share.
Excluding the sales from the Home Collection catalog in the prior year, total revenues of $40.9 million in the current quarter were 13 percent higher than the prior year's pro forma total revenue of $36.3 million and catalog sales increased two percent to $8.9 million from last year's pro forma $8.8 million. The Company decided in the prior year not to make further test mailings of the Sharper Image Home Collection catalog (featuring furniture and accessories).
"The first quarter improved operating results reflect the solid performance of all parts of our business, driven mainly by high-margin proprietary products created by the Sharper Image Design team," said Mr. Richard Thalheimer, founder, chairman, and chief executive officer. Thalheimer further stated that, "We are especially gratified by March and April's double digit increase in our comparable store sales after the slight February comparable store decrease due to low inventory in key items."
"Our Internet sales from our Web site, sharperimage.com, increased significantly for the first quarter as compared to last year due to continued strong customer response to our established online store and our new Sharper Image Product Auction site," Thalheimer explained. "Our online auction, which is accessible from the home page of sharperimage.com, was launched in late February. It is a key component of our Internet growth strategy," Thalheimer concluded.
The Sharper Image is a specialty retailer that is nationally and internationally renowned as a leading source of new, innovative, high-quality products that make life easier and more enjoyable. A significant and growing proportion of sales are of proprietary products created by the Company's product development group, Sharper Image Design. The Company operates 89 stores throughout the United States and mails millions of its award-winning catalogs each month. Additionally, the Company's products may be purchased online via its Internet store at sharperimage.com. The Company also has launched an auction site, where consumers can place a "bid to win" on Sharper Image products. The auction site can be accessed from the home page of the Company's Web site, sharperimage.com.
This release contains certain forward-looking statements regarding the Company's expected performance for future periods, and actual results for such periods may materially differ. Such forward-looking statements involve risks and uncertainties, including risks of changing market conditions in the overall economy and the retail industry, consumer demand, the opening of new stores, actual advertising expenditures by the Company, the success of the Company's advertising and merchandising strategy, availability of products, and other factors detailed from time to time in the Company's annual and other reports filed with the Securities and Exchange Commission.
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