R.G. Barry Q1 Profit Pinched as Sales Decline

Dearfoams, R.G.Barry’s flagship slipper brand

Pickerington, OH—R.G. Barry Corp., makers of Dearfoams slippers and other footwear brands, today reported that its first quarter profit and sales declined from a year ago, but were still in line with management’s expectation for 2013 to be a “challenging year.”

For the quarter ended Sept. 29, R.G. Barry posted earnings of $6.1 million, or 54 cents a share, down 11% from $6.9 million, or 61 cents a share, in the same period last year.

Net sales inched down to $47.2 million from $50.2 million one year ago.

Gross profit as a percent of sales was at 44.3%, flat versus the first quarter last year.

By division, the company’s footwear segment was down $3.9 million from the comparable period last year. In its accessories segment, which includes baggallini handbags, totes and travel accessories, sales increased 11.2% to $9 million, producing a 56.6% gross profit as a percentage of sales.

“These results are in line with our expectations for the quarter and with the direction we provided in our two previous earnings calls,” said Greg Tunney, president/ceo.

As the company heads into the holiday season–peak selling time for slippers–Tunney said they remain confident the products will perform quite well “despite the impact of customer internal issues that frequently disrupt retailers.”

Jose Ibarra, senior vice president finance and chief financial officer, noted that an increase in sales to newer retail channels, such as catalogs, e-commerce and home shopping, helped offset softness at more traditional trail channels and “helped us achieve a healthy 41.4% gross profit as a percent of net footwear sales.”

While the 11% increase in sales at the accessories division, including baggallini was on the lower end of management’s range, the company expects sales with mid-teens growth by mid 2013.

Although the company didn’t provide specific forecasts, Tunney said, “We said previously that we expect fiscal 2013 to be a challenging year. We remain confident in our vision and the successful future of our company…We will have a much better view of our full fiscal year when we report on the second quarter in February.”

In other news, on Monday, the company announced that four directors, including Tunney, were re-elected to two-year terms on R.G. Barry’s eight-member board: Nicholas DiPaolo, Janice Page, Harvey Weinberg and Tunney.

 

 

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