Pacific Sunwear Posts Higher Quarterly Profit

Pacific Sunwear of California Inc. said its fiscal second-quarter earnings surged as a surfing-inspired fashion trend drove double-digit sales gains.

The Anaheim-based retailer said net income for the quarter ended Aug. 2 rose to $13.4 million, or 26 cents a share, from $7.3 million, or 15 cents, in the year-ago quarter. Analysts on average expected earnings of 26 cents.

Sales rose 23% to $234.4 million. Sales at stores open at least a year rose 14%.

The company last week raised its second-quarter earnings forecast for the third time in three months, to 25 to 26 cents a share, and set a 3-for-2 stock split.

In addition to its 650 PacSun and 75 outlet mall stores offering surf and skate wear, Pacific Sunwear has 114 d.e.m.o. stores that specialize in clothing inspired by hip-hop music.

The company said it planned to expand its d.e.m.o. chain, citing strong performance and “the opportunity to be the dominant specialty retailer catering to the hip-hop lifestyle.”

Pacific Sunwear plans to have 1,300 to 1,400 stores in operation by the end of fiscal 2007.

Shares rose as high as $30.60 in after-hours trading after finishing down 35 cents at $30.20 on Nasdaq. The results were released after the market closed.

From Reuters