COMMERCE, Calif. — Dollar store operator 99¢ Only Stores wrapped up its 2010 fiscal year on a strong note, as net profit soared more than 600%, beating Wall Street’s expectations.
Dollar store operator 99¢ Only Stores wrapped up its 2010 fiscal year on a strong note, as net profit soared more than 600%, beating Wall Street’s expectations.
Sales for the year ended March 27 rose 4.1% to $1.31 billion, with same-store sales gaining 3.9%. Net income skyrocketed from $8.48 million in fiscal 2009 to $60.4 million. Fourth quarter earnings rose 141% to $16.9 million, or 24 cents per share, well above the 17 cents per share predicted by analysts polled by Thomson Reuters.
The results reflected the benefit the recession has conferred on extreme value retailers. But it also validated management’s determination to reverse a prior decision to exit the Texas market, where the company closed about a third of its stores.
"Our long-term operational improvement initiatives have continued to exceed our expectations," said chief executive officer Eric Schiffer in a statement. "We believe that these strong results are a validation of the strength of our retail concept. We now believe that we can achieve income before taxes of approximately 7.5% of sales in fiscal 2011."
Management further expects same-store sales to grow in the low single digits during the 2011 fiscal year.