For a quarter that has seen many mall retailers struggle, The Buckle continues to not only endure the effects of the tumultuous environments, but has been able to post remarkable growth in the process — all while exceeding the lofty expectations of analysts.
The teen retailer reported net sales increased 24.6% to $199.7 million for the fiscal first quarter ended May 5 as compared to sales of $160.3 million in the year-ago period. Comp store sales increased 17.7% for the quarter. Net income for the first quarter was $26.9 million, or 58 cents per diluted share, compared to $18.7 million, or 40 cents per diluted share, in the year ago period.
In a conference call with analysts, management said strength in denim — which accounted for 41.5% of sales — was one of the primary drivers for the quarter. Mens merchandise was up 11.5%, propelled by strength in denim, woven and knit shirts and active apparel. For the quarter, the mens business was about 40.5% of net sales as compared to about 45% in last years first quarter. Womens merchandise sales for the quarter increase approximately 35% on strength from denim, knit tops, active apparel, accessories and footwear. Womens merchandise accounted for about 59.5% of sales compared to approximately 55% of sales in Q1 last year.
For the quarter, combined accessory sales were up about 28% and combined footwear sales were up 19%. These accounted for 7% and 5% of total sales, respectively.
Management added that online sales, which are not included in same-store sales numbers, increased 75.7% to $11.7 million in the first quarter. Gross margin, which management said was driven by an increase in merchandise margins, improved 250 basis points to 43.4% of sales. Management noted the improvement in merchandise margins was due primarily to reduced markdowns as a result of a strong sell-through on new product.