Cost controls credited for boost in income at Payless Cashways

KANSAS CITY, Mo. -- Payless Cashways Inc. has reported a 27.2 percent surge in net income on lower sales for its quarter that ended May 25, a showing that one analyst credited to cost controls.

"Now, if they could just get a turn in the sales trend, it would at least help the stock," said Craig Carver, an analyst with Summit Investment Corp. in Minneapolis.

Net income for the quarter, Payless' second, was $5.9 million, compared with $4.6 million a year earlier. Net sales were $682.3 million, a 4.1 percent drop from the year before.

Per-share net income was 11 cents, compared with 8 cents in the year-earlier quarter. Carver said he had been looking for earnings to be flat.

Noting that competitors opened 70 new warehouse stores in Payless markets over the last 18 months, company Chairman David Stanley said:

"Although this situation has adversely affected our consumer sales in recent periods, our sales to professionals have turned around and are improving nicely.

"We expect that consumer sales will recover, as they typically do, over the next several quarters."

Copyright 1996
Provided by ProQuest Information and Learning Company. All rights Reserved.