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Jo-Ann Stores sets sales records for fiscal year

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March 17, 2010

Laura Freeman

Reporter

Hudson -- It was a record year for Jo-Ann Stores Inc., and management hopes to continue to build on that success.

Jo-Ann Stores had record sales of $602 million for its fourth quarter and nearly $2 billion for fiscal year 2010, said Darrell Webb, Jo-Ann Stores chairman and chief executive officer since 2006.

"We exceeded our expectations and achieved the best financial results in the history of the company," Webb said.

Webb said he expects more growth this year.

Net sales for the fiscal year increased 4.7 percent to $1.99 billion compared to $1.9 billion the previous year.

Net income for the fiscal year ending Jan. 30, 2010, was $66.6 million, compared to $21.9 million for the 2009 fiscal year.

Jo-Ann's net income for the fourth quarter was $37.1 million compared to $20.4 million for the fourth quarter last year.

Net sales for the fourth quarter increased 5.3 percent to $602.2 million from $571.9 million from the previous year.

Same-store sales, which compares sales at stores that have been open a year or more, increased 3.1 percent in the fiscal year compared to a 0.5 percent increase in same-store sales for the previous year. Same-store sales increased 4.4 percent in the fourth quarter compared to a 2.9 percent decrease in same-store sales in the previous year's fourth quarter.

"During fiscal year 2010, the Jo-Ann team effectively executed our strategic objectives," Webb said. "We achieved all of this while maintaining tight control of our expenses, inventory, and capital spending, which allowed us to report significant expansion of operating margin and record earnings."

Jo-Ann Stores Inc. has 228 large-format stores and 518 small-format stores.

In fiscal 2010 the company opened 15 large-format stores and five small-format stores and closed three large-format and 35 small-format stores. In fiscal 2011 Jo-Ann expects to open approximately 30 new stores and close approximately 30 stores.

Webb said after a store is remodeled, the company has seen an 8 percent increase in sales and traffic in previous years and saw a 12 percent increase in sales and traffic last year.

Jo-Ann has set a goal to open new or remodel 95 percent of its stores by 2015.

Other impacts on the improvements in sales have been Wal-Mart stores removing fabric from its inventory and keeping seasonal merchandise at the right level for sales, according to Webb.

Not only have young people shown a renewed interest in sewing, but demographic studies indicate the number of people older than 50 will grow and be active in sewing and crafts, Webb said.

"That's a good trend for our store," Webb said.

Economic turmoil, which has changed consumers, has also been a factor, he said.

"They have turned away from conspicuous consumption," Webb said.

Shoppers are more cost efficient and make thoughtful purchases of items that are handcrafted and economically friendly, he said.

E-mail: lfreeman@recordpub.com

Phone: 330-688-0088 ext. 3150




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