Kmart Posts 32% Profit Gain in 4th Quarter

Kmart Corp. reported better-than-expected profit for the latest quarter on higher sales of clothing and home goods under its Martha Stewart and other private brands. The discount retailer said earnings grew 32% in the fiscal fourth quarter to $353 million, or 65 cents a share, excluding one-time items, beating analyst forecasts by 4 cents. Revenue was up 6.6% to $10.4 billion, and sales at stores open at least a year rose 4.5%. Kmart’s earnings have now gained for 11 consecutive quarters under the turnaround led by Chairman and Chief Executive Floyd Hall. He has added higher-margin private brands such as Sesame Street kid clothes, Kathy Ireland and Jaclyn Smith women’s clothing and Martha Stewart towels and linens, as well as groceries to attract shoppers. Kmart shares fell 19 cents to close at $17.50 on the NYSE.

At a Glance

Other earnings, excluding one-time gains and charges unless noted:

* Tiffany & Co.’s net income jumped 27% to $53.3 million, or $1.49 a share, in the fiscal fourth quarter, well above expectations of $1.42, as revenue grew 20% to $442.8 million. Tiffany said its jewelry and other luxury goods sold well in Japan as well as the U.S. and Europe. Sales at U.S. stores open at least a year grew 12%.

* TJX Cos., operator of T.J. Maxx and Marshalls discount apparel chains, posted a 29% gain in earnings to $126.9 million, or 39 cents, in the fiscal fourth quarter, as it improved inventory management. The results exceeded forecasts by 4 cents. Revenue was up a slight 1.8% to $2.28 billion, and same-store sales grew 4%.