Stride Rite Posts Strong Q1

Additionally, the company's same-store sales increased by 7.8% on a year-over-year basis. Stride Rite has 254 stores, up three from 2004. They plan to open more than 20 new stores this year.

"The balance sheet remains strong," Stride Rite Chairman and Chief Executive Officer David Chamberlain told investors in a conference call Tuesday. "Overall, we expect '05 to be another strong year."

The Lexington, MA-based retailer said sales for the first quarter ending March 4 were up 11%, or $150.6 million, from $136.1 million in the same quarter one year earlier. Children's group sales helped bolster the numbers with a 13% increase.

The company also reported a first quarter net income of $8.2 million, or 22 cents a share, up from the prior year's $7.5 million, or 19 cents a share.

First quarter sales rose 32% for the Sperry Top-Sider division while the firm's Keds brand increased 8%. International sales also showed a 31 percent first quarter increase but sales for the company's Tommy Hilfiger Footwear line declined 10% during the period.

Chamberlain said an earlier Easter along with the "preppy" fashion trend and the firm's success with women's footwear helped buoy the numbers.

The company also plans to reposition its Keds brand during 2005 and has launched an advertising campaign featuring actress Mischa Barton as the Keds spokeswoman, Chamberlain noted.

"We expect Keds sales in the second quarter to be flat to slightly down from last year, as we continue to position the brand with high-end retailers and fewer closeouts," Chamberlain said of the company's repositioning strategy.

Stride Rite said its net income totaled $8.2 million, of 22 cents a share, during the first quarter, an increase from the prior year's $7.5 million, or 19 cents a share. Those results include a non-cash charge of about $300,000 related to lease accounting.

Despite those strong numbers, shares of Stride Rite fell $1.22, or 9.1 percent, to close at $12.25 on the New York Stock Exchange yesterday.