It was a bullish bouquet for 1-800-Flowers
Sales spiked 19% higher to hit $329.9 million. That was actually a little lighter than the 21% top-line spurt that analysts were looking for. You also have to consider that $42 million of the $52 million gain in sales came from the Fannie May candy businesses that it acquired back in May. Organic growth actually clocked in just 4% higher.
We can overlook that because of the explosive margin expansion, but it should also temper your expectations as to how quickly the company is actually growing its top line. Despite the lackluster organic improvement, 1-800-Flowers posted double-digit growth in all but one of its key categories.
The laggard? It was the Home & Children's Gifts category, slumping under competitive pressure. Despite the 1-800-Flowers name, the company runs several mail order and e-commerce outfits in this niche, like Plow and Hearth for home decor, Problem Solvers, Wind & Weather, and Madison Place, along with crafty toy shops in HearthSong and Magic Cabin.
It's easy to see where the company's specialty brands would get lost here. Alexa.com's list of the most popular home furnishings sites include bigger names like Ikea, Williams-Sonoma's
Thankfully, the company is doing just fine everywhere else. It is also leaning more and more on the Internet despite its telephonic brand. Of its 1.2 million new customers, 63% came to the company through its online storefronts. 1-800-Flowers now has a database of more than 25 million customers to market to. The trend confirms the path that led ProFlowers.com parent Provide Commerce -- the once-popular Rule Breakers recommendation -- to be acquired at a premium by Liberty Media Interactive
Floriculture buffs may want to note that rival FTD
Different seeds for different strokes, it seems.
Provide Commerce was singled out to Rule Breakers readers in 2005. It was acquired by Liberty for a 23% gain less than a year later. If you're interested in seeing the full list of recommendations for the newsletter, try a free 30-day trial to the service.
Longtime Fool contributor Rick Munarriz prefers to send flowers to his wife on April Fools Day instead of Valentine's Day. Don't worry. She's in on the joke. He does not own shares in any of the companies in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.