Today, J.Crew announced financial results for the three months (third quarter) and nine months (first nine months) that ended on November 1, 2008.
Third Quarter highlights:
- Revenues increased 9% to $363.1 million. Store sales (Retail and Factory) increased 7% to $250.9 million, with comparable store sales decreasing 3%. Comparable store sales increased 5% in the third quarter of fiscal 2007. Direct sales (Internet and Phone) rose by 13% to $101.8 million. Direct sales increased 36% in the third quarter of fiscal 2007.
- Gross margin decreased to 41.6% of revenues from 45.6% of revenues in the third quarter of fiscal 2007.
- Operating income decreased 32% to $32.5 million, or 9.0% of revenues, compared to $47.7 million, or 14.3% of revenues, in the third quarter of fiscal 2007. Operating income in the third quarter of fiscal 2008 includes approximately $6 million of costs related to our Direct channel systems upgrades.
- Net income was $19.0 million, or $0.30 per diluted share, compared to net income of $26.8 million, or $0.42 per diluted share, in the third quarter of fiscal 2007.
Millard Drexler, J. Crew’s Chairman and CEO stated: “Despite these difficult economic times our priorities remain the same - providing innovative product, style and design, servicing our customers and making disciplined investments. At the same time, we recognize that a sea-change has occurred with the consumer. In the near term we are not immune to the significant challenges we are all facing in retail in these unprecedented times. However, our powerful brands, unique product offerings, compelling value proposition and multi-channel operating platform position us well for the long-term.”
To read more on the conference call, please click here and here.
Given the state of the economy, I am not surprised about the results of J.Crew’s fiscal third quarter. In the marketplace, there are not very many retailers that are doing well. Please be cautious of the gift card that you buy this season. I have been reading very many horror stories of shoppers not being able to redeem them.
November 26th, 2008 - 1:32 pm
Regarding gift cards, as long as you stick to the big and relatively stable companies (LL Bean, JCrew, etc.), you should be O.K. Just don’t let them sit in your wallet for months (even years) like I do sometimes. There has been an email going around lately carrying a scary warning about gift cards. While this email is not exactly a hoax, it should be taken with a grain of salt, as it is outdated and therefore not entirely accurate.
November 26th, 2008 - 2:01 pm
Leigh, I think that is so cool that you are doing a winter contest! I loved reading the entries. Hope you have a great Thanksgiving!
November 26th, 2008 - 2:21 pm
Not many places are doing well. Several shops at my shopping center have closed but I always see people in Jcrew. I look at other places, Banana Republic, Old navy and always end up at J Crew. I found the herringbone dream sweater marked down on the sale, another 20% off, plus another 10% from a coupon for giving my email address. Also spotted the sweater on TV, Access Hollywood interview. And saw Jcrew reindeer tee and cardigan on soapnet cable channel on General Hospital promotion.