GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

rue21 inc. Reports Operating Results (10-Q)

December 02, 2011 | About:
insider

10qk

18 followers
rue21 inc. (RUE) filed Quarterly Report for the period ended 2011-10-29.

Rue21 Inc. has a market cap of $580.2 million; its shares were traded at around $23.72 with a P/E ratio of 16.7 and P/S ratio of 0.9.

Highlight of Business Operations:

Net sales increased 18.8% to $194.8 million in the third quarter of 2011, compared to $163.9 million in the third quarter of 2010. Comparable store sales were flat in the third quarter of 2011 as compared to an increase of 1.8% in the third quarter of 2010. For the year-to-date 2011 period, net sales increased 21.5% to $540.4 million, as compared to $444.6 million in the year-to-date 2010 period. Comparable sales increased by 1.5% in the year-to-date 2011 period as compared to an increase of 2.4% in the year-to-date 2010 period.

During the third quarter of 2011, our net sales increased 18.8%, or $30.9 million, to $194.8 million as compared to $163.9 million in the third quarter of 2010. This increase in net sales was due to an approximate 15% increase in the number of transactions, driven by new store openings during fiscal year 2011. Net sales also increased due to an increase of approximately 3% in the average dollar value of transactions. The average dollar value of transactions increased due to an increase in average unit retail offset by a slight decrease in units per transaction. During the third quarter of 2011, we opened 30 new stores compared to 33 new stores in the third quarter of 2010. Our comparable store sales were flat in the third quarter of 2011 compared to an increase of 1.8% in the third quarter of 2010. There were 580 comparable stores and 160 non-comparable stores open at October 29, 2011 compared to 493 and 135, respectively, at October 30, 2010.

Selling, general and administrative expense increased 19.2%, or $8.2 million, to $50.8 million in the third quarter of 2011 as compared to $42.6 million in the third quarter of 2010. As a percentage of net sales, selling, general and administrative expense increased to 26.1% in the third quarter of 2011 as compared to 26.0% in the third quarter of 2010.

Net Sales increased 21.5%, or $95.8 million, to $540.4 million for the year-to-date 2011 from $444.6 million for the year-to-date 2010. The increase in net sales was due to an approximately 16% increase in the number of transactions, primarily driven by new stores opened in 2011. Net sales also increased due to an increase of approximately 5% in the average dollar value of transactions. The average dollar value of transactions increased due to an increase in average unit retail offset by a slight decrease in units per transaction. During the year-to-date 2011 period, we opened 103 new stores and closed 1 store as compared to 95 new stores and 2 closures in the year-to-date 2010 period. Our comparable store sales increased 1.5% for the year-to-date 2011 period compared to an increase of 2.4% for the year-to-date 2010 period. There were 580 comparable and 160 non-comparable stores at October 29, 2011 compared to 493 and 135, respectively, at October 30, 2010.

Selling, general and administrative expense increased 22.2%, or $26.4 million, to $145.0 million in the year-to-date 2011 period as compared to $118.7 million in the year-to-date 2010 period. As a percentage of net sales, selling, general and administrative expense increased to 26.8% in the year-to-date 2011 period as compared to 26.7% in the year-to-date 2010 period. During the year-to-date 2010 period, we incurred $0.6 million in expense related to our secondary offering of common stock completed in March 2010. Excluding the impact of these secondary offering costs, selling, general and administrative expenses as a percentage of net sales, would have decreased to 26.6% in the year-to-date 2010 period. Store operating expenses increased by $20.7 million in the year-to-date 2011 period as compared to the year-to-date 2010 period, due primarily to the operation of 740 stores as of October 29, 2011 compared to the operation of 628 stores as of October 30, 2010. As a percentage of net sales, store operating expenses increased to 20.1% for the year-to-date 2011 period as compared to 19.8% in the year-to-date 2010 period, primarily as a result of increasing costs of store payroll partially offset by lower benefit costs.

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 2.0/5 (3 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Email Hide