West Marine Inc. reported a shift in the retail calendar resulted in a $2.1 million, or 1.1 percent, decline in net revenues for the third quarter ended Oct. 3, but raised its full-year guidance for comparable store sales growth.

The Wastonville, CA-based retailer reported net sales decreased to $194.4 million compared to $196.5 million for the third quarter of 2014. Comparable store sales decreased by 0.7 percent for the third quarter. Sales comparisons were negatively impacted from a shift in the fiscal calendar following a 53-week fiscal year and decreased sales by approximately 6 percent. The calendar shift moved the selling period leading up to July 4th to the second quarter this year, as compared to July 4th being part of the third quarter last year.

Pre-tax profit margin declined by 0.6 percent of revenues to 4.4 percent for the third quarter compared to 5.0 percent for the third quarter last year. This change primarily was driven by a 0.8 percent decrease in gross profit margin resulting from deleveraging of raw product cost of goods, as well as, a 0.3 percent decrease in selling, general and administrative expense.

Net income for the third quarter was $4.9 million, or $0.20 per diluted share, compared to net income of $4.9 million, or $0.20 per diluted share, for the third quarter of 2014.

2015 Guidance
West Marine updated its previously announced full year guidance:

  • Comparable store sales are expected to be in the range of 3.5 percent to 5.5 percent, up from our previously issued range of 1.0 percent to 4.0 percent,
  • Pre-tax income is expected to range from approximately $6.0 million to $8.0 million, compared to our previously issued range of $6.0 million to $11.0 million,
  • EBITDA is now expected to be in the range of approximately $27.0 million to $29.0 million, compared to our previous range of $26.0 million to $31.0 million,
  • GAAP diluted earnings per share is expected to be in the range of approximately $0.14 to $0.20, compared to the previously issued range of $0.14 to $0.27 earnings per share,
  • Capital expenditures for fiscal 2015 are expected to be approximately $25 million, compared to our previously issued range of $22 million to $25 million.

“Our comparable store sales are trending to the high end of our original guidance, however, we are experiencing lower than anticipated gross profits,” the company said in a press release. “The lower gross profits have been driven by increased inventory shrinkage and a charge for a product quality issue.

Additionally, we had higher than expected clearance sales resulting from the successful launch of our ship-from-store program and the liquidation of inventory associated with the closure of our stores in Canada.”

West Marine, Inc. is the largest omni-channel specialty retailer exclusively offering boating gear, apparel and footwear and other waterlife-related products to anyone who enjoys recreational time on or around the water.

With over 260 stores located in 38 states, Puerto Rico and Canada and an eCommerce website reaching domestic and international customers,