Party City parties on in fourth quarter; plans to expand

Party City on Thursday posted an increase in same-store sales and profit for the fourth quarter and said it is on track to expand its footprint this year.



But it also cautioned that sales may slow.



Party City reported a profit of $86.5 million for the fourth quarter ended Dec. 31, up from $79 million a year earlier. On a per-share basis, earnings declined to 72 cents from 83 cents.



Total revenue slipped 2.8% to $781.5 million. Same-store sales increased 2.8%, fueled by a strong Halloween season.



“We are very pleased to have ended 2015 with a strong fourth quarter and to have delivered total sales and earnings performance for the year within the original guidance ranges we set for ourselves early in 2015," said James M. Harrison, CEO, Party City Holdco Inc.



The company noted that in 2015 it completed the acquisitions of costume maker Travis Designs and plastics manufacturer ACIM.



Looking ahead to fiscal 2016, Party City expects fiscal 2016 total revenues of $2.35 to $2.42 billion, and comparable sales to range from flat to up slightly. Its revenue guidance fell short of analysts' expectations.



“In 2016, we have many exciting opportunities to expand our business such as tapping into new customer markets like B2B, increasing our international penetration, expanding our store base and driving e-commerce growth, Harrison said. “We remain focused on our multiple growth strategies and are committed to successfully integrating the acquisitions of ACIM and Travis, as well as continuing to seek new opportunities to deepen our vertical model to fuel further margin expansion by manufacturing more of what we sell.”



Party City Holdco’s retail operations include approximately 900 party supply stores (including some 180 franchised locations) throughout North America operating under the names Party City and Halloween City, and e-commerce websites, principally through the domain name PartyCity.com.