Fourth quarter sales at The Container Store were up, as the specialty retailer’s custom closets business coupled with an enhanced focus on targeted marketing campaigns were cited as key drivers.
Consolidated net sales for the quarter ended April 2 were $221 million, up 5.3% from the comparable quarter the previous year. Comparable store sales, however, were down 0.2%. Consolidated net income was $8.4 million, or $0.17 per share, in the fourth quarter compared to net income of $3.4 million, or $0.07 per share, in the previous fourth quarter.
In addition, company officials also announced a four-part plan they said is designed to optimize The Container Store’s business and drive improved sales and profitability.
According to the company, the plan includes sales initiatives, certain full-time position eliminations at The Container Store, organizational realignment at Elfa and ongoing savings and efficiency efforts. The expected annualized pre-tax savings associated with the optimization plan are approximately $20 million, of which approximately $12 to $15 million, or $0.15 to $0.19 on a per share basis, is expected to be realized in fiscal 2017, for an estimated net benefit of approximately $0.03 to $0.05 on a per share basis.
Fiscal year consolidated net sales were $819.9 million, up 2.9% from the previous fiscal year. Net sales at The Container Store were $752.7 million, up 3.4% primarily due to new store sales, partially offset by a 2.4% decrease in comparable store sales.
Elfa third-party net sales were $67.3 million, down 3.1% primarily due to the impact of foreign currency translation during the fiscal year, which reduced third party net sales by 2.4%, as well as lower sales in Russia, the company said.
The company plans to open the following locations in fiscal 2017: Cleveland, OH (first quarter); Albuquerque, NM (second quarter); Livingston, NJ (third quarter); Staten Island, NY (third quarter); and relocation of its Chestnut Hill, MA, store (third quarter).
