West Marine reports 2Q results

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West Marine announced net revenues of $215.4 million for the second quarter of 2009, a decrease of 5 percent compared to the same quarter of 2008. Comparable-store sales dropped 1 percent.

Comparable-store sales for the second quarter 2009 benefited by $8.4 million, or 4.2 percent, because of a favorable fiscal calendar shift from fiscal year 2008.

West Marine's sales typically build week-over-week leading up to the peak of boating season, and the fiscal calendar shift meant there were more peak season days, including the Independence Day holiday, in the second quarter of this year, which benefited comparable-store sales, the company said.

Income before taxes was $32.3 million, a $5.5 million increase compared to the same period last year.

Earnings per share were $1.46, compared to 20 cents for the same period last year, which included 72 cents per share of non-recurring, non-cash charges.

"We are extremely pleased with our operating results for the second quarter. Our profitability and cash flow increased significantly, and we dramatically lowered debt," CEO Geoff Eisenberg said in a statement.

"While the boating industry overall has continued to struggle, we believe we've benefited from an uptick in boat usage in many markets, a movement towards more 'do-it-yourself' projects, and very good customer acceptance of our product line expansions," he added.

Eisenberg said the company has also been "positively impacted" by the "demise of a large competitor," referring to Boater's World going out of business.

Gross profit for the quarter was $73.1 million, a decrease of $5.3 million compared to 2008. As a percentage of net revenues, gross profit decreased by 0.7 percent to 33.9 percent, compared to gross profit of 34.6 percent last year.

The decrease in gross profit as a percentage of revenues primarily resulted from higher unit buying and distribution costs given the reduced inventory levels. Additionally, West Marine experienced deleveraging of store occupancy because of lower revenues and the relatively fixed nature of these expenses.

Net revenues for the 26 weeks ending July 4 were $316.3 million, a 6.9 percent decrease compared to net revenues of $339.9 million for the 26 weeks ending June 28, 2008.

Comparable-store sales declined 2.9 percent versus the same period a year ago. Comparable-store sales for the first half of 2009 benefited by $13.3 million, or 4.4 percent, from the fiscal calendar shift described above.

Gross profit for the 26 weeks ending July 4 was $95 million, a decrease of $5.9 million compared to 2008. As a percentage of net revenues, gross profit increased by 0.3 percent to 30 percent compared to gross profit of 29.7 percent last year.

West Marine, the largest specialty retailer of boating supplies and accessories, has 342 company-owned stores in 38 states, Puerto Rico and Canada, and two franchised stores located in Turkey.


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