Charming Shoppes in Q1 profit surge

Bensalem, PA–Charming Shoppes Inc. said Thursday that it had earned $26 million during its first quarter, a surge from $3.9 million a year earlier.

After struggling for several yers, the retailer has been executing a plan to close 240 unprofitable stores this year and reducing inventory to help stabilize prices and avoid markdowns of heaps of unsold merchandise, the copapany said.

Lane Bryant Improves

The earnings translated to net income of 22 cents per share, vs. 3 cents per share a year earlier.

Its Lane Bryant’s quarterly comparable sales increased 7% over a year earlier, the company said. The higher sales at the major plus-size-apparel chain contributed to an overall 2% increase in comparable sale. Online sales, which increased 16%, also helped. Overall net sales for the quarter were flat at $504 million.

By division, comparable sales were down 3% at Fashion Bug and 2 percent at Catherines.

More than half the 240 unprofitable stores being closed are Fashion Bugs, including 46 of the 78 already shut down this year, the company said.

Eric M. Specter, chief financial officer told analysts on a conference call that  “the majority of the Fashion Bug stores that will remain will be, in fact, profitable.”

Anthony M. Romano, president and ceo, added that high cotton prices were affecting the company, but would likely have a greater impact later this year.

Charming Shoppes has increased some prices and is gauging to what extent its shoppers can withstand the additional cost, given that consumer spending is also being affected by rising gas and food prices, Romano said.

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