LJ Int'l (JADE) Reports Significant Increase in Sales at ENZO Unit; Raises Q4, FY09 EPS Guidance
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LJ International Inc. (NASDAQ: JADE) today announced a significant increase in revenues at its ENZO
retail division, on both an overall and same-store basis, during Q4. It also announced an upward revision of earlier guidance for Q4 and FY09.
Company’s ENZO Retail Divison Continues to Exceed Expectations
The Company reported that sales at its ENZO chain of retail stores across Greater China rose approximately 56% in the fourth quarter of 2009 from a year earlier, to an estimated total of approximately $16.7 million. It achieved this gain despite a slight decrease in the number of ENZO stores, to 95 at the end of 2009 from 97 a year earlier.
On a comp-store basis, net sales increased an average of 19% year-over-year in the fourth quarter of 2009. The Company noted that these increases were due to the growing popularity of the ENZO brand, increased sales from the Christmas and National Day holidays, productivity gains at the store level as well as ongoing changes in its inventory mix. LJI’s comp-store data are based on figures from stores open 13 months or more. There were 75 such stores in the fourth quarter of 2009.
CEO Sees ENZO Capturing Greater Share of China’s Jewelry Market as Roll-Out Continues
“Our fourth quarter sales shows that ENZO is poised for rapid growth as the Chinese economy continues to recover and Chinese consumer spending resumes its historic upward trend,” said LJI Chairman and CEO Yu Chuan Yih. “Our strong results over the past year also reflect good management of the ENZO chain, which has shut underperforming stores and sharply increased its per-store results in the process. With ENZO gross margins continuing to run at more than 50% and nearly all of our stores individually profitable, the division is now capable of resuming its expansion largely on the strength of its own cash
flows. We expect to be able to roughly double the number of ENZO locations over the next two years, adding approximately 100 stores to serve the rapidly growing Chinese market and to meet rising consumer demand for our products.”
Guidance Raised for Q409 and FY09
In light of its updated retail sales figures, LJI issued new revenue guidance for Q4 and FY09. It now projects combined wholesale and retail revenues of at least $39 million for Q4 and at least $110 million for FY09. This is up from earlier guidance, issued in November 2009, for quarterly and annual revenues of $30 million and $100 million. Based on these projections, revenues will be down approximately 6% and 19% year-over-year for Q4 and FY09 respectively, with lower sales in LJI’s wholesale operations offsetting gains in its retail division.
The Company has also increased its guidance for EPS at $0.09 for Q4 and $0.15 for FY09.
retail division, on both an overall and same-store basis, during Q4. It also announced an upward revision of earlier guidance for Q4 and FY09.
Company’s ENZO Retail Divison Continues to Exceed Expectations
The Company reported that sales at its ENZO chain of retail stores across Greater China rose approximately 56% in the fourth quarter of 2009 from a year earlier, to an estimated total of approximately $16.7 million. It achieved this gain despite a slight decrease in the number of ENZO stores, to 95 at the end of 2009 from 97 a year earlier.
On a comp-store basis, net sales increased an average of 19% year-over-year in the fourth quarter of 2009. The Company noted that these increases were due to the growing popularity of the ENZO brand, increased sales from the Christmas and National Day holidays, productivity gains at the store level as well as ongoing changes in its inventory mix. LJI’s comp-store data are based on figures from stores open 13 months or more. There were 75 such stores in the fourth quarter of 2009.
CEO Sees ENZO Capturing Greater Share of China’s Jewelry Market as Roll-Out Continues
“Our fourth quarter sales shows that ENZO is poised for rapid growth as the Chinese economy continues to recover and Chinese consumer spending resumes its historic upward trend,” said LJI Chairman and CEO Yu Chuan Yih. “Our strong results over the past year also reflect good management of the ENZO chain, which has shut underperforming stores and sharply increased its per-store results in the process. With ENZO gross margins continuing to run at more than 50% and nearly all of our stores individually profitable, the division is now capable of resuming its expansion largely on the strength of its own cash
flows. We expect to be able to roughly double the number of ENZO locations over the next two years, adding approximately 100 stores to serve the rapidly growing Chinese market and to meet rising consumer demand for our products.”
Guidance Raised for Q409 and FY09
In light of its updated retail sales figures, LJI issued new revenue guidance for Q4 and FY09. It now projects combined wholesale and retail revenues of at least $39 million for Q4 and at least $110 million for FY09. This is up from earlier guidance, issued in November 2009, for quarterly and annual revenues of $30 million and $100 million. Based on these projections, revenues will be down approximately 6% and 19% year-over-year for Q4 and FY09 respectively, with lower sales in LJI’s wholesale operations offsetting gains in its retail division.
The Company has also increased its guidance for EPS at $0.09 for Q4 and $0.15 for FY09.
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