VOL. 128 | NO. 106 | Friday, May 31, 2013
Fred’s Net Income Rises 9 Percent
The Associated Press
Discount retailer Fred’s Inc. said Thursday its first-quarter net income rose 9 percent, helped by a modest rise in sales and lower costs.
Memphis-based Fred’s Inc. reported its first-quarter net income rose 9 percent, helped by a modest rise in sales and lower costs, the discounter said Thursday. A customer shops at the Collierville Fred’s at 450 U.S. 72.
Daily News File/Lance Murphey
The results topped Wall Street predictions, and shares rose in morning trading.
For the three months ended May 4, Fred’s earned $11.4 million, or 31 cents per share, up from $10.5 million, or 28 cents per share, in the 2012 first quarter.
Revenue totaled $501.5 million compared with $500.5 million a year ago.
Analysts, on average, expected a profit of 27 cents per share on $499.5 million in revenue, according to FactSet.
The Memphis-based company said its revenue at stores open at least a year fell 1.3 percent. The metric is a key measure of a retailer’s health, because it excludes sales at stores that recently opened or closed.
Fred’s said it remains “guardedly optimistic” about the second quarter. It projected a profit of between 6 cents and 9 cents per share on sales growth of between 2 percent and 4 percent. Based on the company’s prior-year results, the guidance implies revenue of between $480.2 million and $489.6 million for the current quarter.
Analysts expect earnings of 10 cents per share on $481.6 million in revenue.
The company also backed its full-year profit prediction for earnings of 77 cents to 88 cents per share, while analysts expect earnings of 82 cents per share.
Shares of Fred’s rose 84 cents, or 5.5 percent, to $16.04 in morning trading. The stock has changed hands between $12.30 and $16.08 in the past 52 weeks, and is up about 20 percent since the start of the year.
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