Party City celebrates 'impressive' Q1
Party City’s CEO says robust sales prompted an “impressive” increase in same store sales in the first quarter, the company’s first quarterly report after an April IPO.
The company said Thursday it raised about $398 million in net proceeds from the initial public offering, which it used to redeem debt. Party City has entered an agreement with a Mexican company to open franchise stores throughout Mexico, and it expects to franchise at least 80 Party City stores by the end of 2024 with the first three stores being targeted for operations within the next 12 months.
“We’re very pleased with our results this quarter, which were driven by higher sales in both our retail and wholesale channels”, said James M. Harrison, CEO. “In retail, we had impressive comparable sales even after adjusting for the benefit of the Easter shift. New stores and larger transaction dollar sizes driven by product expansion and innovation contributed to robust retail sales. On the wholesale side, sales performance was fueled by strong demand for licensed juvenile birthday products and metallic balloons and higher international sales.”
The party-supply retailer reported sales of $462.1 million in the quarter, a 7% increase over the first quarter of 2014. the company posted a loss of $8.5 million, or nine cents a share, compared with a loss of $19.9 million, or 21 cents a share, a year earlier.
Harrison added:“Our performance this quarter illustrates the strong, competitive advantages of our unique, vertically-integrated business model. We continue to make progress executing on our multiple growth strategies which include further expanding our vertical integration, pursuing alternative markets and expanding our global footprint.”
During the quarter the company opened three new stores, acquired two franchise stores and closed five stores. At March 31, the company operated 693 Party City stores and 205 franchise stores for a total store count of 898 as compared to 673 Party City stores and 209 franchise stores for a total store count of 882 at March 31, 2014.
Looking ahead to 2015, Party City expects earnings excluding items of 97 cents to $1.06 a share, on revenue of $2.25 billion to $2.35 billion. It expects a a same store sales increase of 3% to 3.5%.