1-800-Flowers.com posts highest-ever sales and profits in second quarter
As it announced in January that it expected to, 1-800-Flowers.com posted revenues of $197 million for its fiscal second quarter ended December 29, representing growth of 22% over the year-ago quarter. Though it was a record-breaking quarter for the company, revenues were slightly below Wall Street projections of $202 million to $206 million.
Net income for the quarter increased 457% to $10.1 million compared with $1.8 million a year ago. Gross profit margin for the quarter rose to 45.6% from 43.6% a year ago, driven by increased demand for non-floral gifts – they represent 67% of all telephonic and online orders combined for the quarter --and greater efficiencies in operations and customer service. EBIDTA rose to $14 million for the quarter from $5 million a year ago.
At $76 million, online sales rose 25% from $60.5 million a year ago, while telephone sales rose 22% to $114 million from the year-ago quarter. Though the results were slightly below earlier projections, “We were able to achieve our largest quarter ever in terms of both top and bottom line,” says CEO Jim McCann.
In other results, the company reported attracting 1.2 million new customers in the second quarter, 42% of whom came to the company online. 47% of all orders placed during the quarter represented repeat customers.
Despite an economic climate in which the company predicts "cautious" consumer spending, McCann says 1-800-Flowers.com is projecting growth of 7% to 9% over last year in the second half of its fiscal year. “Unlike many retail companies that are dependent on year-end holiday shopping for the majority of their results, we have two good quarters ahead of us,” he says, noting that the fiscal third quarter includes Valentine’s Day and the fourth quarter Easter and Mother’s Day, which traditionally drive major sales spikes for the company.
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