True Religion Apparel rings up positive Q3
Shares of True Religion Apparel, Inc. (Nasdaq: TRLG) are treading in the green today after the company most notably known for its jeans brand, True Religion, reported third-quarter results in line with the Street.
For the three months ended Sept. 30, the small cap recorded net income of $8.9 million, or $0.38 per share for the quarter. Excluding $0.4 million in charges related to the separation agreements with former executives and the impact of an increased tax rate that had the effect of reducing earnings per diluted share by $0.03, net income was $9.8 million or $0.42 per share. The consensus of eight analysts polled by Thomson was earnings of $0.39 per share.
Net sales were $48.7 million, an increase of 12.8% from $43.2 million in the 2006 third quarter and in line with the $48.09 million in revenues eight analysts polled by Thomson were on average expecting.
Net sales for the company’s consumer direct segment increased to $7.2 million from $0.7 million in the third quarter of 2006 on account of retail store expansion, with 11 full-price stores and two outlet stores open at the end of the third quarter of 2007, compared with one full-price store and one outlet store at that date last year.
Net sales in the company’s U.S. wholesale segment remained roughly flat at $30.1 million, compared with $30 million in the same quarter last year. The company said this segment’s sales growth was pressured by production delays related to new, more intricate fall merchandise.
The firm’s international wholesale business sales declined 12.8% to $10.9 million from $12.5 million in the same period in 2006. The company sited that the decline was primarily due to a planned reduction in sales to the company’s Japanese distributor to properly position the brand. Excluding Japan, international wholesale net sales were up 19% compared with the third quarter of 2006.
Looking forward, True Religion reiterated its previously issued guidance of net sales of approximately $167 million and earnings of between $1.24 and $1.27 for the year. The consensus of eight analysts polled by Thomson is for earnings of $1.25.
The company noted that its Fall and Holiday collections, which include several new denim groups and an expanding sportswear offering, are being received with “great enthusiasm.”
Shares of True Religion (TRLG) rose 12.66%, or $2, to $17.80 at 1:58 p.m. ET. Shares of True Religion have been trading in the range of $13.89 to $23.74 for the past 52 weeks.
