Coldwater Creek Inc. reported first net income of $2.8 million–double that of last year–despite a .07% downturn in sales to $112 million, compared with the same period last year. The quarter ended June 2.
Direct sales fell by 14.6% to $88.5 million. This was primarily due to a 13.8% drop in catalog circulation, or the mailing of 5.8 million fewer books.
The direct segment, which includes catalog and e-commerce business, now constitutes 79% of the company’s total net sales, compared with 91.9% in the same quarter of 2001.
However, retail net sales grew by 158.2% to $23.5 million, and account for 21% of the firm’s total net sales, compared with 8.1% last year.
“As a percentage of total net sales, we have successfully shifted more of our overall business to the Internet retail stores, in keeping with our integrated triple-channel retailing strategy,” said CEO Georgia Shonk-Simmons in a statement.
E-commerce sales rose by 11% to $38.5 million, and now make up 34.4% of total company sales, compared with 39.7% during the same period last year.
Coldwater Creek may increase catalog circulation from planned levels in the second half.
Shonk-Simmons attributed the earnings performance to “lower marketing costs, coupled with the effectiveness of our ongoing cost-control programs and the efficiencies gained from our recent consolidation of all shipping functions to our East Coast distribution center.”
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