Arts & Crafts retailer Michaels Store's net sales up 13.1% to $821mn
26 May '05
7 min read
gross margin as a percent of sales in the second quarter is expected to contract approximately 40 basis points versus the prior year due to the timing of merchandise plan-o-gram resets and the related markdowns. for the first half of fiscal 2005, gross margin as a percent of sales is currently forecast to expand approximately 50 basis points due to improved merchandising margins, partially offset by higher occupancy costs as a percent of sales.
selling, general, and administrative expenses as a percent of sales for the second quarter are expected to decline approximately 140 basis points, primarily due to a favorable comparison to the prior year second quarter when incremental expenses were recognized to reflect the deteriorating financial condition of a previous insurance carrier.
diluted earnings per share for the second quarter of 2005 are currently expected to range from $0.20 to $0.22, including the redemption costs of approximately $12.1 million described above.
for the second half of fiscal 2005, same-store sales are expected to increase 3% to 5% over the second half of fiscal 2004. operating margin is expected to expand by approximately 150 basis points in the second half of fiscal 2005 versus the second half of fiscal 2004, largely driven by gross margin expansion. gross margins are expected to improve primarily due to anticipated increases in merchandising margins and the absence of the lease accounting correction recorded in the second half of fiscal 2004, largely driven by gross margin expansion. gross margins are expected to improve primarily due to anticipated increases in merchandising margins and the absence of the lease accounting correction recorded in the fourth quarter of last year. as compared to the second half of fiscal 2004, operating income is expected to increase over the prior year by 20% to 25% in the second half with net income and diluted earnings per share increasing 30% to 35% in the third quarter and 20% to 25% in the fourth quarter.
marketing@alchempro.com
