Rue21 Q2 Profit, Sales Up

Warrendale, PA—Rue21 reported Thursday that its second quarter profit rose 19% due to an increase in its stores and an increase in revenue.

For the quarter ended July 28, rue21 reported a profit of $9.1 million, or 36 cents a share, up from $7.7 million, or 31 cents a share, a year ago.

Total revenue rose 17% to $202.1 million. Comparable store sales edged up 0.5%. Gross margin widened to 39.4% from 39.1%.

The teen retailer again raised its full year earnings estimate by 4 cents to $1.80 to $1.85.

For the current quarter, the company expects 38 cents to 40 cents in earnings while analysts expected 39 cents.

“The industry is seeing a trend of customers buying closer to need and with schools opening later than last year and the important tax free days in August, we did see end of July business move into the third quarter,” said Bob Fisch, president/ceo. “This quarter, our girls sportswear performed well led by dresses, shorts and woven tops. And our guys business was our number one performer and also delivered strong results. In accessories, we were up against some great fashion trends from last year, so our accessory business particularly in jewelry was a little tougher.”

Fisch said footwear continued to be a strong category, offsetting the underperforming jewelry accessory category.

“Our fast sourcing model has allowed us to refocus our accessory assortments for back-to-school,” he added. “That is always our secret sauce.”

 

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