CHARLOTTE, N.C.-Strong sales and successful leveraging of expenses resulted in a powerful 26.3 percent increase in net income for Belk Inc. in its fiscal first quarter, totaling $40.3 million.
Net sales rose 7.2 percent to $909.8 million in the quarter, which ended on April 28 and which include a same-store sales gain of 7.4 percent. Tim Belk, the retailer’s chairman and CEO, noted that first-quarter sales exceeded the company’s expectation. “Color in the assortment has been a powerful story this spring,” Belk said. “We were well positioned with inventory in early March, and our customers responded.”
Selling, general and administrative expenses, while increasing 1.4 percent in dollars, were down 146 basis points as a percentage of sales to 25.6 percent. Gross margin edged up five basis points to 33.8 percent.
Belk is in the midst of a five-year period in which it intends to invest $600 million in store remodels, service improvements, e-commerce, information technology, merchandise planning and processes, marketing and branding, and improved sourcing practices. In the current fiscal year, it is spending $75 million on expansion and remodeling in 29 stores. Two stores will be relocated, four stores will be expanded and remodeled, 13 stores will be remodeled, and shoe departments and fashion jewelry departments will be expanded and remodeled in 10 stores.