Restoration Hardware beats Q2 profit estimates

Corte Madera, Calif. – Restoration Hardware Holdings Inc. beat consensus analyst estimates by swinging from a net loss to profit in the second quarter of fiscal 2014, but had smaller-than-expected sales growth.



The upscale home furnishings retailer reported net income of $27.3 million, compared to net loss of $17.8 million during the same period a year earlier.



Restoration Hardware said its ability to rapidly test and deploy new products, categories and businesses across its multichannel platform drove a significant increase in operating margin, which was mainly responsible for its strong earnings performance.



Net revenues increased 14% to $433.8 million, from $382.1 million. The retailer cited a late mailing of its 2014 Source Book as negatively impacting its Fourth of July promotional sales, which in turn dampened net revenues for the quarter.



Restoration Hardware will be opening a new, larger Full Line Design Gallery in Los Angeles and its first next-generation Full Line Design Gallery in Atlanta later in 2014. The company has signed leases for eight next-generation Full Line Design Galleries and has identified and is in negotiations for more than 30 additional locations.