House of Fabrics’ Profit Surges in 4th Quarter

House of Fabrics said its fiscal fourth-quarter profit nearly doubled from a year earlier despite a modest 3% sales gain.

The operator of fabric stores, based in Sherman Oaks, said net income in the quarter ended Jan. 31 jumped to $4.3 million, or 64 cents a share, from $2.3 million, or 34 cents a share, a year earlier. Sales rose to $91.9 million from $89.7 million.

Gary L. Larkins, president and chief executive, attributed the gains to the company’s ongoing program of opening larger stores and closing smaller shops. The shift is eliminating House of Fabrics’ marginally profitable stores and boosting its overall profit margin by improving its economies of scale, he said in a statement.

For its full fiscal year, House of Fabrics’ earnings rose 69% to $10.5 million, or $1.58 a share, from $6.2 million, or 94 cents a share, in fiscal 1987. Sales climbed to $322.5 million from $316.4 million.