Michaels paints a pretty financial quarter

The CEO of Michaels says an improved merchandising strategy and a focus on the customer experience helped drive sales growth at the specialty retailer in the second quarter.

Total sales increased 3.8% to $984.3 million in the second quarter ended Aug. 1 at Michaels and same store sales increased 2.9%. Michaels reported a profit of $35.7 million, or 17 cents a share, vs. a loss of $46.8 million, or 26 cents a share, a year ago.

"I am pleased with our second quarter performance, which was driven by general sales strength across our business and continued financial discipline," said Chuck Rubin, chairman and CEO. "We delivered 2.9% comparable store sales growth on a local currency basis, reflecting our differentiated merchandise offering and progress on our initiatives to elevate our customer experience. We also improved our adjusted operating margin by 80 basis points and delivered a 21.4% increase in adjusted diluted earnings per share."

During the second quarter the company opened nine new Michaels stores and relocated three ending period with 1,186 Michaels stores in 49 states and Canada and 118 Aaron Brothers stores.

Rubin continued: "I believe we are well positioned to take advantage of the fall and holiday seasons in the back half of the year with the right level and composition of inventory as well as exciting marketing events to engage our customers. We are focused on continuing to implement our long term strategy as we create an improved shopping experience for our customers and drive value for our shareholders."

Last week, Michaels said it formed a partnership with San Francisco-based online DIY marketplace Darby Smart. As part of the arrangement both companies will sell and promote each other’s craft products and projects starting in September.

The company continues to expect fiscal 2015 total net sales growth of 3.2% to 3.7% and a same store sales increase of 1.5% to 2.0%.