West 49 Inc., the Canadian action sports chain, reduced its net loss in
the second quarter ended July 28, to Canadian $589,000 (U.S. $560,000)
from C$822,000 (U.S. $782,000).
Net sales for the 130-unit chain increased 6.8% to C$42.4 million (U.S.
$40.3 million). Same-store sales increased 0.3%, with the flagship West
49 banner achieving comparable store sales growth of 1.9%. The company
also operates stores under the Billabong, Off The Wall,
Amnesia/Arsenic, D-Tox, and Duke's Northshore banners, as well as
www.boardzone.com.
Figures were converted from Canadian to U.S. dollars at current exchange rates.
Gross margin rate increased 250 basis points to 25.2% of net sales due
to higher product margins.; SG&A expenses decreased 80 basis points
to 22.9% as a rate to net sales, excluding restructuring costs.
During the quarter, the company opened three stores: a West 49 store
in Timmins, Ontario, a D-Tox store in London, Ontario, and a Duke's
Northshore store in West Vancouver, British Columbia. The company also
closed an Amnesia store in Laval, Quebec. A year ago, it had
118 stores.
“Our second quarter results reflect successful execution of our
strategies to maximize returns from existing operations and grow our
banners across Canada,” said Sam Baio, CEO of West 49 Inc. “We improved
our gross margin, benefited from our commitment to improving expense
management, and relocated and expanded three stores to more optimum
locations and sizes. We continued our momentum in store openings with
three new stores during the quarter and expanded our total retail
square footage to date by 8.1%. Given the seasonality inherent in our
business, we are pleased with the continued improvement in our EBITDA
and the reduction of our net loss for the quarter relative to the
second quarter of last year.”
