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Winter that wasn’t constrains REI profits

Published March 19, 2012

SEATTLE, WA (BRAIN) March 19 2012 8:10 AM MT—REI last week reported an 8.4 percent jump in annual sales for 2011, to $1.66 billion, but operating income was down slightly, to $116.2 million from 2010’s record $116.6 million. Net income was flat compared with 2010 at $30.2 million.

“We experienced strong sales in 2011. However, because winter weather failed to arrive, our profitability was impacted,” said Brian Unmacht, REI’s executive vice president. “Looking ahead, our underlying strong financial position allows us to continue our growth plans and invest in ways that make it easy for customers and members to shop REI however they wish—online, on the go or in one of our stores.”

REI carries bikes from such brands as Cannondale, GT, Marin, Raleigh, Scott, Surly, Electra and its own Novara label, but does not break out financials for its bike business.

As the largest U.S. consumer cooperative, REI welcomed nearly 842,000 new members in 2011, up 7 percent from 2010. The company shares its profits with its members through an annual patronage refund in proportion to their eligible purchases. Based on the co-op’s 2011 performance, $99.8 million in patronage refunds will be distributed to 4.7 million members this month.

By the end of 2011, REI operated 122 stores in 29 states. It opened eight new stores last year, in Paramus, New Jersey; Carle Place, Manhattan and Yonkers, New York; Greenville, South Carolina; Dublin and Santa Barbara, California; and Olympia, Washington.

The company plans to open five stores this year, in Indianapolis, Indiana; Cincinnati, Ohio; San Antonio, Texas; Medford, Oregon; and Woodbridge, Virginia. It will also move its Cary, North Carolina, store to a larger location.

Topics associated with this article: Earnings/Financial Reports

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