Saks' 1Q profits, but revenue disappoints

AP News
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Posted: May 15, 2012 8:40 AM
Saks' 1Q profits, but revenue disappoints

Saks reported a 13 percent bump in first-quarter profit but sales came in well below Wall Street expectations.

Shares slid 4 percent in premarket trading.

Saks posted earnings of $32.1 million, or 18 cents per share, compared with $28.4 million, or 16 cents per share last year.

Excluding costs related to the construction of a new fulfillment center, Saks would have earned 19 cents per share. That edged out Wall Street expectations by a penny, but investors are looking at revenue.

Revenue rose 3.8 percent to $753.6 million, short of the $761.7 million expected by analysts, according to a poll by FactSet.

The New York company says that it has seen a slowdown in women's designer clothing and expects that extra markdowns will erode profit margins for the current quarter.