Bakers Footwear Group, Inc. reported sales were $58.2 million in the fourth quarter, an increase of 1.0% from $57.6 million a year ago. Comparable store sales increased 2.6% following an increase of 3.9% in the prior-year period. Net income slid 7.1% to $5.2 million, or 54 cents a share, from $5.6 million, or 72 cents, a year ago.

Gross profit was $20.6 million, or 35.3% of net sales, compared to $21.0 million, or 36.4% of net sales, in the fourth quarter last year. This decrease reflects increased costs related to the launch of H by Halston and increased promotional activity on boots and booties due to softer than expected demand in December to allow the company to end the year positioned for the spring season.

Selling, general and administrative expenses were $15.1 million, or 25.9% of net sales, compared to $14.8 million, or 25.8% of net sales, in the prior-year period.

Operating income was $5.5 million, compared to $6.1 million in the fourth quarter last year.

Peter Edison, chairman and chief executive officer of Bakers Footwear Group, commented, “We achieved solid profitability in the fourth quarter fueled by positive comparable store sales and a 9.9% increase in multi-channel sales despite increased promotional activity toward the end of the quarter to position our business for a much improved spring season. The year included progress toward our key initiatives to increase sales and position our company for improved long term operating performance. To this end, we continued our fashion leadership in footwear, which is demonstrated by the achievement of our third consecutive year of positive comparable store sales in 2010. We introduced exclusive brands in our Bakers stores to provide further differentiation in our offerings, which is expected to increase customer loyalty and broaden our consumer reach. We also capitalized on the significant runway that we see ahead to increase our multi-channel sales. At the same time, we continued to tightly manage expenses. Our increased inventory levels at year end reflected the early receipt of spring goods with aging improved from 2009. We also are happy to note that we completed the repayment of our subordinated secured term loan during the fourth quarter.”

“As we begin fiscal 2011, our business is off to an encouraging start with comparable store sales increasing 9.8% for the first eight weeks of the fiscal year. We attribute the growth in our sales to our ability to identify key footwear trends for our customers with our sales growth led by robust regular price selling across our spring shoe offerings. We are also very pleased with the response to our introduction of our exclusive H. By Halston and Wild Pair brands. We will continue our focus on controlling expenses while maximizing opportunities to drive profitable sales and expect to further advance our goal of delivering improved operating performance this year in our ongoing effort to increase value for our stakeholders.”

For the fiscal year, the fifty-two weeks ended January 29, 2011:

    * Net sales were $185.6 million, up from $185.4 million for the fifty-two weeks ended January 30, 2010;
    * Comparable store sales increased 1.7%, compared to a 1.3% increase in fiscal 2009;
    * Gross profit was $49.6 million, or 26.7% of net sales, compared to $53.4 million, or 28.8% of net sales in fiscal 2009;
    * Selling, general and administrative expenses were $55.6 million, or 30.0% of net sales, compared to $56.8 million, or 30.6% of net sales, in fiscal 2009;
    * Impairment expense was $1.4 million, reflecting non-cash charges associated with certain underperforming stores, compared to $2.8 million in fiscal 2009;
    * Operating loss was $7.5 million, compared to an operating loss of $6.5 million in fiscal 2009; and
    * Net loss was $9.3 million or $1.14 per share, compared to a net loss of $9.1 million, or $1.24 per share in fiscal 2009.

For the first eight weeks of fiscal 2011 ended March 26, 2011, comparable store sales increased 9.8% compared to an increase of 1.6% in the same period last year.

Based on the company's business plan, the company believes it has adequate liquidity to fund anticipated working capital requirements and expects to be in compliance with its financial covenants through the next twelve months.

Bakers Footwear currently operates 231 stores nationwide under the Bankers and Wild Pair names.