Birks & Mayors reports quarterly sales increase and a narrowing of losses

Luxury jewelry retailer Birks & Mayors Inc. reported a first-quarter net sales increase of 21.9 percent. Total sales for the period were $68.6 million, compared with $56.2 million for the same period in the prior year. Excluding one extra selling week in April of 2006, sales rose 14.3 percent.

Same-store sales increased 9 percent, compared with a 6 percent increase for the same period in the prior year, said the company, which owns and operates 67 stores in Canada, Florida and Georgia. Same-store sales among Canadian stores increased 10 percent, while same-store sales among U.S. stores grew 9 percent.

The company’s net loss for the quarter improved by $375,000, to $913,000, compared with a loss of $1.29 million in the prior year. Gross profit margin rose 20 basis points to 47.9 percent of net sales.

The company also noted that it prepaid $11.7 million of its bank debt bearing an effective interest rate of 12.75 percent, which is now carried on its operating line of credit bearing interest of approximately 7 percent.

Earnings before interest, taxes, depreciation and amortization (EBITDA) was $3.2 million in the fourteen weeks for the period, compared to $2.1 million in the prior year, an improvement of $1.1 million, the Montreal-based company said.

“We began the year very well, by reporting a double digit increase in net sales, continuing to expand our product margins and realizing a 51 percent gain in EBITDA for the first quarter,” said Thomas A. Andruskevich, Birks & Mayors president and chief executive officer. “We believe that this performance demonstrates the success of our business model and strategies and our ongoing ability to increase customer loyalty with distinctive offerings and excellent customer service. As we look ahead, we believe that the initiatives we have identified in new product development, merchandising, manufacturing and marketing, along with new store growth, have us poised to continue our momentum going forward.”