- The Container Store on Tuesday reported first quarter consolidated net sales rose 6.9% to $195.8 million. Retail net sales rose 7.8% to $180.1 million, and third-party net sales through its custom shelving unit, Elfa International, fell 1.9% to $15.7 million.
- Comparable store sales rose 4.7%, grabbing some 190 basis points from Custom Closets orders placed in the fourth quarter that were delivered and installed in the first quarter, according to a company press release.
- Consolidated net loss in the quarter reached $6.8 million, down from $7.7 million in the year-ago quarter, the company said. Adjusted earnings before interest, taxes, depreciation, and amortization nearly doubled, reaching $12.4 million in the quarter from $6.4 million a year ago, the company said.
The Container Store hasn't been left out of retail's overall rebound, and the turnaround traction the retailer notched in the fourth quarter has continued apace, leading executives to raise their guidance for the year, saying they now expect a consolidated sales range between $890 million and $900 million, based on comp store sales estimates of up 1.5% to up 2.5%.
"Much like Q4, improved top-line trends during the quarter were driven by our many sales revitalization and optimization initiatives," CEO Melissa Meyer Reiff told analysts on Tuesday, according to a transcript from Seeking Alpha. "A great example is our marketing efforts. The reallocation of our marketing spend from traditional to digital channels continues to drive our improving results, and our fresh and reinvigorated marketing campaigns were well received by our customers."
The company is still taking in the impact of new concept stores and will incorporate feedback from customers and store staff, she also said. "Our research has shown us that our customer's biggest hurdle in beginning a project is feeling overwhelmed," she said. "Therefore, the focus of our technology tools, in-store merchandising, and overall layoff in our redesign Dallas flagship store is to make it easier and more convenient for our customers to accomplish their projects."
That wait-and-learn approach applies to smaller locations now open in Oklahoma City, Denver and Tysons Corner, Virginia, which will be under 20,000 square feet, she also said.
The company is also exploring an expansion beyond retail and is evaluating how to grow its B2B business through its Elfa unit. Though Reiff called that a "huge opportunity," she also warned that it's early and said the company is still evaluating its strategy and its partnerships. "[W]e know it's an important channel and a great opportunity, but ... it's really important to remember that it's a very small, tiny part of our business right now, even though it's a pretty rapidly growing business," she said.