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Michaels Posts Strong Net Gains for Q4, FY2013

For the fourth quarter ended February 1, 2014, Michaels Stores, Inc. announced that net income increased 36.2% to $143 million. According to Michaels, comparable store sales increased 4.6% driven by a 4.2% increase in the company’s average ticket and a 0.5% increase in transactions, partially offset by a 10 basis point impact from deferred custom framing revenue, the company said. 

The company also posted financial results for the full fiscal year ended February 1, 2014. For FY 2013, net income increased 32% to $264 million and as a percent of net sales increased approximately 130 basis points to 5.8%. Net sales increased 3.7% to $4.57 billion from $4.41 billion over fiscal 2012.

Net sales for the fourth quarter increased 2.0% to $1.55 billion from $1.52 billion during the fourth quarter of fiscal 2012, which had a 53rd week that generated an estimated $66 million in net sales. Additionally, gross profit for the quarter increased 1.0% to $623 million from $617 million during the fourth quarter of fiscal 2012. Gross profit decreased approximately 40 basis points to 40.1% as a percent of net sales. The decrease in the company’s gross profit rate was driven by lower merchandise margin, and increased freight and distribution costs, partially offset by improvements in the company’s shrink rate. Operating income for the quarter increased 8.6% to $277 million and, as a proportion of net sales, increased 110 basis points to 17.8%.

Michaels ended the year with 1,257 stores, 1,136 of which are Michaels and 121 of which are Aaron Brothers stores.