Claire's Stores Q1 net sales $311.0 million
he company reported net sales of $311.0 million for the fiscal 2018 first quarter, an increase of $11.4 million, or 3.8% compared to the fiscal 2017 first quarter.
Net sales were affected by a favorable foreign currency translation effect of our non-U.S. net sales, an increase in new concession and company-operated store sales and increased franchisee sales, partially offset by the effect of store closures and a decrease in same store sales.
Net sales would have decreased 1.0% excluding the impact of foreign currency exchange rate changes.
Consolidated same store sales decreased 0.4%, with North America same store sales increasing 5.4% and Europe same store sales decreasing 9.9%.
The company computes same store sales on a local currency basis, which eliminates any impact from changes in foreign currency exchange rates.
For the fiscal 2018 second quarter-to-date period, consolidated same store sales have increased approximately 1.0%, with North America outperforming Europe.
Gross profit percentage increased 70 basis points to 50.0% during the fiscal 2018 first quarter versus 49.3% for the prior year quarter.
This increase in gross profit percentage consisted of a 100 basis point decrease in occupancy costs, partially offset by a 20 basis point increase in buying and buying-related costs and by a 10 basis point decrease in merchandise margin.
The decrease in occupancy costs, as a percentage of net sales, resulted primarily from the leveraging effect of an increase in total net sales.
Selling, general and administrative expenses increased $15.3 million, or 13.8%, compared to the fiscal 2017 first quarter.
As a percentage of net sales, selling, general and administrative expenses increased 350 basis points compared to the three months ended April 29, 2017.
Excluding an unfavorable $6.0 million foreign currency translation effect and non-recurring pre-Chapter 11 consulting expense of $8.6 million, selling, general, and administrative expenses would have increased by $0.7 million.
Excluding the foreign currency translation effect and non-recurring pre-Chapter 11 consulting expense of $8.6 million, the increase was primarily due to increased compensation-related expense, including store incentive compensation, and concession store commission expense.
Adjusted EBITDA in the fiscal 2018 first quarter was $41.9 million compared to $41.8 million last year.
Adjusted EBITDA would have been $41.0 million excluding the foreign currency translation effect in the first quarter of 2018.
The company defines Adjusted EBITDA as earnings before income taxes, net interest expense, depreciation and amortization, loss (gain) on early debt extinguishments, asset impairments, and reorganization items.
Adjusted EBITDA excludes management fees, severance, the impact of transaction-related costs and certain other items.
As of May 5, 2018, cash and cash equivalents were $56.1 million. The company had an additional $65.6 million of borrowing availability under its debtor-in-possession credit facility as of May 5, 2018, net of applicable reserves. ■