Express Inc. a specialty retail apparel chain operating more than 600 stores announced its first quarter 2012 financial results for the thirteen week period ended April 28, 2012, which compares to the same period ended April 30, 2011.Michael Weiss, Express, Inc.'s Chairman, President, and Chief Executive Officer commented: "We had a solid start to the year, reporting a double digit increase in earnings per diluted share while making steady progress toward our long-term goals.
“The first quarter included the roll out of our new loyalty program, Express NEXT, to all stores in the United States and the opening of four new stores in our new design format.
“In addition, shortly after quarter end, we entered into a multi-country international franchise arrangement, marking our entry into Latin America. Net sales grew by 6%, with comparable sales rising 4%, including a double digit increase in e-commerce sales. As we look ahead, we remain confident in our go-to-market strategy and that our disciplined execution of our four growth pillars will allow for continued success."
First Quarter Operating Results:
• Net sales increased 6% to $496.0 million from $467.4 million in the first quarter of 2011;
• Comparable sales increased 4%, following an 8% increase in comparable sales in the first quarter of 2011;
• Gross margin decreased 10 bps to 38.1% of net sales compared to 38.2% in the first quarter of 2011;
• Selling, general, and administrative (SG&A) expenses totaled $114.2 million, or 23.0% of net sales. This compares to SG&A expenses of $109.5 million, or 23.4% of net sales, in the first quarter of 2011, which included $0.6 million of costs related to the secondary offering completed in April 2011;
• Operating income increased 7.4% to $74.6 million, or 15.0% of net sales, compared to $69.4 million, or 14.9% of net sales, in the first quarter of 2011;
• Interest expense totaled $4.8 million compared to interest expense of $11.0 million in the first quarter of 2011, which included a $3.5 million loss on extinguishment of debt related to the repurchase of $25.0 million of Senior Notes;
• Income tax expense was $27.9 million, at an effective tax rate of approximately 39.9%, compared to income tax expense of $23.4 million, at an effective tax rate of approximately 40.1%, in the first quarter of 2011; and
• Net income was $42.1 million, or $0.47 per diluted share. This compares to net income of $35.0 million, or $0.39 per diluted share, in the first quarter of 2011, which included the following non-core operating costs after tax:
1) $0.3 million, or $0.01 per diluted share, related to the secondary offering completed in April 2011; and
2) $2.1 million, or $0.02 per diluted share, related to the repurchase of $25.0 million of Senior Notes. Net income for the first quarter of 2011, adjusted for non-core operating costs noted above, was $37.5 million, or $0.42 per dilutedshare.
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