Pickerington, OH—R.G. Barry Corp., owner of Dearforms slippers and baggallini handbags, said today that its third quarter net profit rose nearly 85% as sales in its accessories division increased offsetting sales declines in footwear.
For the quarter ended March 30, the company said net profit rose 84.8% to $1.5 million, or 13 cents a share, compared to $800,000, or 7 cents a share, in the same period a year ago.
Net revenue increased 2.7% to $25.8 million With gross profit as a percent of net sales widened to 45.9% from 44.6% one year ago. Selling, general and administrative expenses were down 2.9% from the equivalent period last year at $9.6 million.
“The strong performance of our accessories segment and its contribution to our operating results combined with benefits realized by eliminating under-performing components of our footwear business add to the viability of our evolving business model and position us for significant growth in the next three-to-five years,” said Greg Tunney, president/ceo.
Slipper Sales Edge Down
In its footwear division, the company reported net sales were down 4.1% to $16.4 million, reflecting fewer shipments to mass and off-price customers. Nine-month net sales declined 12.1% to $94.2 million, reflecting, in part, the impact of the company’s decision last year to eliminate some under-performing elements of its footwear business, loss of its seasonal men’s slipper business “in a national department store chain,” and reduction in the size of some seasonal club programs vs. 2012.
In its accessories segment, which includes baggallini leathergoods and the recently acquired KIVA brand, the company saw sales increase 17.3% (up 15.2% to $27.4 million in its first nine months). Gross profit as a percentage of net sales in its accessories segment widened to 56.3%.
“The accessories segment generated operating profit of $2.1 million for the quarter, up 44.4%; and $5.4 million for the nine months, an increase of 13.3% over the previous year,” the company said.
Tunney said that the company is investing in its “platforms and our people. We are expanding into new and underserved markets. And, we are seeking out and acquiring successful accessories brands that can help propel us to the next level. We are quite confident that we can achieve our growth and profitability targets for the businesses.”
Although Tunney said the company’s 2013 performance will not match its record-setting one last year, “we will end fiscal 2013 on June 29 as one of our industry’s top performers.”