Dayton, Ohio - Increased gross profit - due primarily to higher sales of large-screen and digital televisions, coupled with a reduced emphasis on commodity items, such as VCRs and small-screen televisions - did much to push annual net income at Rex Stores to record levels in the retailer's 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.