Higher sales of large-screen and digital televisions, coupled with a reduced emphasis on commodity items, such as VCRs and small-screen televisions, increased gross profit at Rex Stores and led to record-level annual net income for the fiscal year.
Increased cost controls, through reduced inventory, also helped produce the record net income.
The chain reported a 19 percent increase in net income for the 12 months ended Jan. 31, hitting $22.3 million, up from $18.7 million the previous year. Sales for the fiscal year slipped slightly, to $464.5 million, down about 2 percent from $475.4 million in the year-ago period. Comp-store sales for the year dropped 8 percent.
In the fourth quarter, Rex recorded a 26 percent increase in net income, reaching $10.9 million, up from $8.6 million year over year. Sales for the three months fell 5 percent, to $151.8 million, down from $159.8 million. Comp-store sales for the fourth quarter were off 7 percent.
Rex enjoyed a gross margin increase of 150 basis points in the 12 months, rising to 28.9 percent, compared with 27.4 percent in the year-ago period. In the fourth quarter the gross margin increase was even higher, hitting 260 basis points, to 29.3 percent, up from 26.7 percent in the same quarter a year ago.
Income from operations rose 2.3 percent for the 12 months, reaching $22.2 million, up from $21.7 million the previous year. Income from operations jumped 24 percent in the fourth quarter, hitting $12.8 million, compared with $10.3 million year over year.