Sport Chalet Reports First Quarter Fiscal 2011 Results
LOS ANGELES, Aug. 2, 2010 (GLOBE NEWSWIRE) -- Sport Chalet, Inc. (Nasdaq:SPCHA) (Nasdaq:SPCHB) today announced financial results for its first quarter ended June 27, 2010.
First Quarter Results
Sales increased 0.4% to $79.7 million for the first quarter of fiscal 2011 from $79.4 million for the first quarter of fiscal 2010. The increase is primarily due to improvements in the Team Sales and Ecommerce Divisions partially offset by a slight decrease in comparable store sales of 0.2%, a result of continuing macroeconomic weakness in the Company's markets which provided no catalyst for improved sales.Gross profit as a percent of sales increased to 28.3% compared to 26.4% for the first quarter of last year. The increase was primarily a result of decreased rent expense from successful landlord negotiations as well as improved merchandise margins from better inventory management. Selling, general and administrative expenses ("SG&A") as a percent of sales increased to 26.5% from 25.1% in the same period last year, primarily due to increases in workers compensation expense, labor costs, payroll taxes and advertising. Depreciation declined as a percent of sales to 3.3% from 4.4% primarily due to impairment charges incurred in the previous two fiscal years as well as lower capital expenditures. As a result of increased gross profit and reduced depreciation, partially offset by increased SG&A expenses, net loss for the quarter ended June 27, 2010 was reduced to $1.9 million, or $0.14 per diluted share, compared to a net loss of $3.0 million, or $0.21 per diluted share, for the quarter ended June 28, 2009. Craig Levra, Chairman and CEO, concluded, "We continue to improve the efficiency of our business, while leveraging the factors that differentiate Sport Chalet in specialty retail. The trade areas in which our stores are located continue to suffer the most from the economic downturn; every indicator suggests that California, Arizona, and Nevada, where 98% of our stores are located, will continue to be the hardest hit. That being said, we believe that our business has stabilized and will continue to deliver positive EBITDA and positive cash flow. The stability of our comparable store sales attests to our efforts to align our operations with the current economic realities of our markets."
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