Harold's Stores

Harold’s Stores Inc., Dallas-based chain of upscale ladies’ and men’s specialty apparel stores, announced a net income of $37,000 for its fiscal year ended Jan. 29, 2005. That compares to a net loss of $6.2 million in the prior year.

For the year, total same-store sales increased 1.9 percent, with an increase of 1.7 percent in full-line retail stores and an increase of 5.6 percent in the outlet stores. Net sales for the year fell 2.5 percent, but the company said the majority of that sales decline can be attributed to the closing of nine unprofitable store locations during 2003 and 2004.

For the fourth quarter, total same-store sales increased 1.9 percent — 1.6 percent in the full-line retail stores and 9,6 percent for the outlets. Net sales for the quarter fell 3.3 percent.

“We are extremely pleased to achieve operating profitability in 2004,” said president and ceo Hugh Mullins. “It has been six years since the company last reported profitable operating results for an annual period, The key . . . has been reducing the company’s dependence on promotional activities. This resulted in a substantial increase in full-price selling, from 41 percent of sales in 2003 to 53 percent of sales in 2004, which led to a significant improvement in reported gross margins. Reported gross margins rose 4.5 points in 2004, increasing to 34.3 percent.”

Founded in 1948, Harold’s Stores currently operates 41 specialty stores in 19 states. The Company’s Houston locations are known as Harold Powell.