On March 12, crafts retailer Jo-Ann Stores (NYSE:JAS) released earnings for the fourth quarter ended Feb. 3.

  • Sales declined 0.5% due to planned reductions of holiday inventory and less clearance merchandise in the stores.
  • The gross profit margin improved by 310 basis points because of better sell-through on seasonal goods, reduced sales of clearance inventory, and fewer promotional pricing initiatives.
  • During the fiscal year, the company opened 21 superstores and five traditional stores, and closed 61 traditional stores and two superstores.
  • For fiscal 2008, EPS is expected to be $0.55 to $0.65.

(Figures in millions, except per-share data)

Income Statement Highlights

Q4 2007

Q4 2006

Change

Sales

$600.8

$604.1

(0.5%)

Net Profit

$25.8

($18.0)

N/A

EPS

$1.05

($0.78)

N/A

Diluted Shares

24.5

23.7

3.4%



Get back to basics with the income statement.

Margin Checkup

Q4 2007

Q4 2006

Change*

Gross Margin

45.0%

41.9%

3.1

Operating Margin

7.0%

(1.5%)

8.5

Net Margin

4.3%

(3.0%)

7.3

*Expressed in percentage points

Margins are the earnings engine.

Balance Sheet Highlights

Assets

Q4 2007

Q4 2006

Change

Cash + ST Invest.

$18.4

$17.9

2.8%

Inventory

$453.4

$514.7

(11.9%)



Liabilities

Q4 2007

Q4 2006

Change

Accounts Payable

$147.5

$146.6

0.6%

Long-Term Debt*

$210.4

$283.5

(25.8%)

*Long-term debt includes other long-term liabilities

The balance sheet reflects the company's health.

Cash Flow Highlights

The cash flow statement must still be at the warehouse. Management will find it for the 10-K.

Free cash flow is a Fool's best friend.

Related Foolishness:

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