Build A Bear reports net sales for its European operations have boosted its overall Q4 and full-year results.
Net retail sales from European operations soared by 80 per cent to $59 million in the 2007 full year, compared to $32.7 million in the 2006 full year. Operating income from European operations totalled $0.7 million in 2007 compared to a loss of $1.5 million in 2006.
For Q4, European net sales increased almost 50 per cent from $15.8 million to $23.5 million. Operating income for the same period increased 55 per cent from $3.3 million to $5.1 million.
The firm’s chairman and CEO, Maxine Clark said: “We are pleased with the growth and improvement delivered by our European operations. We are gaining positive traction in the United Kingdom; our brand building and store operation strategies are delivering results.”
The firm’s total revenue for the fourth quarter increased three per cent to $147.4 million. Its full year total revenue increased nine per cent to $474.4 million, which included net retail sales of $468.2 million, an increase of $35.6 million. The firm attributed this growth to new stores opening in North America, an increase in sales from European operations of $26.3 million, and an increase in internet sales of 13 per cent to $12.2 million. Comparable store sales in North America, however, declined 10 per cent compared to a decline of 6.5 per cent in 2006.
Clark said: “Our 2007 results reflect the current challenges in the retail environment.
“Our 2008 plan balances our long term business goals while recognising these near term challenges. While our full market potential in North America remains more than 350 stores, we will slow new store growth this year to approximately 20 stores, down from 39 new stores in 2007. This allows us to focus on building our long-term brand value with the addition of our virtual world, buildabearville.com.
“Our strategy has always been to put our brand wherever families and children go to have fun and our investment in buildabearville.com recognises the emerging trend of kids' interaction and play in the online space. We believe we are strongly positioned to lead in this space with over 60 million stuffed animals sold and over 24 million households in our database,” Clark said.
“In addition to leveraging buildabearville.com to bring traffic to our stores, our ongoing marketing and merchandise plans balance initiatives to attract new guests and retain existing guests. While our near term sales trends reflect the continuing decline in consumer spending, we believe that our business plan, superior store economic model, strong cash flow, and flexible capital structure will deliver long term sales and earnings growth.”