Rising Expenses Cut Brookstone Fourth-Quarter Net 22 Percent
MERRIMACK, N.H.-Increased costs offset a healthy net sales gain to reduce Brookstone's fourth-quarter net income 22 percent, to $42.8 million.
Selling, general and administrative expenses for the quarter, which ended on Jan. 1, increased by 11 percent in dollars and 32 basis points as a percentage of sales, to 23.2 percent. In addition, gross margin fell 265 basis points to 42.5 percent.
The sales picture for the quarter was much more rosy than the bottom line. Net sales totaled $249.4 million in the quarter, up 9.5 percent, and included a 6.7 percent increase in same-store sales. Ron Boire, Brookstone's CEO, said this marked the fifth consecutive quarter of comparable-store increases, and that the retailer is positioned "favorably" for the 2011 fiscal year.
For the fiscal year as a whole, Brookstone posted a net loss of $19.6 million, compared to a net loss of $7.8 million in the prior fiscal year. Net sales gained 8.8 percent to finish the year at $468.2 million.