Maidenform Brands, Inc. reported 2010 second quarter net income of $13,659,000 on sales of $149,401,000 compared to income of $7,278,000 on sales of $114,205,000 for the same quarter last year.
Maidenform Brands, Inc. reported 2010 second quarter net income of $13,659,000 on sales of $149,401,000 compared to income of $7,278,000 on sales of $114,205,000 for the same quarter last year. The 31 percent increase in sales was “driven by continued strength in its core shapewear and bra businesses across the company’s wholesale channels,” according to a company statement that accompanied the release of results. Shapewear net sales increased 44 percent, bra net sales increased 31.6 percent, department stores and national chain stores channel net sales increased 17.5 percent and mass merchant channel net sales increased 61.3 percent the statement declared.
“This marks our sixth consecutive quarter of strong net sales growth, and we believe that we are well positioned for 2010 and beyond,” said Maurice S. Reznik, CEO. “While sales across all of the company’s wholesale channels increased in the quarter, we are particularly pleased that sales from some of our newer strategic initiatives like Donna Karan and international are beginning to accelerate and have a greater impact on our overall performance.”
The company provided a detailed look at its quarterly results. Wholesale segment net sales in the second quarter of 2010 increased $35.2 million, or 35.3 percent, to $134.9 million. Retail segment net sales were unchanged at $14.5 million in the second quarter of 2010 when compared to the comparable period last year.
Net sales for the department stores and national chain stores channel increased $9.8 million, or 17.5 percent, to $65.9 million in the second quarter of 2010. This increase was due to the solid performance of the company’s shapewear and bra businesses resulting from replenishment orders to support consumer spending and new product introductions along with the continued improvement from the company’s licensed brands Donna Karan and DKNY, according to the company statement.
Mass merchant channel net sales increased $16.3 million, or 61.3 percent, to $42.9 million in the second quarter of 2010. This increase included strong sales growth in the Sweet Nothings brand shapewear and bra categories, and continued sales of shapewear products in the Self Expressions brand which were not in the same period of 2009.
Net sales in the company’s other sales channels increased $9.1 million, or 53.5 percent, to $26.1 million in the second quarter of 2010 primarily from increased sales to a specialty retailer. (The company did not name the retailer). Total international net sales, which are included in the wholesale segment, increased $3.3 million, or 38.8 percent, to $11.8 million. This increase was driven by increased sales in most of the company’s international markets, notably Mexico, the United Kingdom and Spain, according to the company statement.
Maidenform operates 74 outlet stores and one “shapewear kiosk” and its total retail segment net sales were unchanged at $14.5 million in the second quarter of 2010 with same store sales defined as stores that have been open for more than one year, increasing 0.8% . Internet sales were unchanged at $1.2 million in the second quarter of 2010. During the second quarter of 2009 the company had 75 outlet stores.
Consolidated gross profit increased $13.0 million, or 31.6 percent, to $54.1 million in the second quarter of 2010. As a percentage of net sales, consolidated gross margins were 36.2 percent in the second quarter of 2010 versus 36.0 percent in the second quarter of 2009. The modest increase was a result of product mix and the benefit from product cost reduction efforts, which were partially offset by customer mix, including a higher percentage of net sales from the company’s lower margin mass merchants and other channels, according to the statement.
Looking ahead, the company predicted that “Net sales for the third quarter are expected to increase in the low-to-mid teens percent range as compared to the prior year. Gross margin rates are anticipated to be in the mid-30 percent range. Earnings per share are expected to be in the range of $0.50 to $0.55.” For the full year 2010, “Net sales are expected to increase in the upper-teens percentage range for the year. Gross margin rates are anticipated to be in the mid-30 percentage range. Earnings per share are expected to be in the range of $1.88 - $1.93.”
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