Investing.com -- Shares in The Container Store jumped more than 6% in after-hours trading after the Texas-based specialty retail chain store posted lower-than expected losses on Tuesday during its most recent fiscal quarter.
Tamped down by foreign exchange losses from a stronger dollar, The Container Store saw its sales dip by more than 2% on the period to $169.8 million. As a result, the company experienced a first quarter loss of $5.2 million, down from negative $3.58 million during the same period in 2014.
Still, Container Store CEO Kip Tindell was encouraged by his company's resiliency as the losses for the quarter weren't as severe as previously anticipated.
“Our first quarter financial performance exceeded our expectations, as we delivered better than forecasted comparable store sales and improved gross margin," Tindell said in a statement.
Tindell is confident that the rollout of TCS Closets, the company's new closet collection, will help enhance sales for the remainder of the fiscal year. The company already launched the closet project in 36 stores nationwide over the first quarter and will add it in 35 additional stores over the final three quarters of the year. In addition, the Container Store will expand its in-home organization service Contained Home and its customer engagement program Pop! over the next several quarters.
“The implementation of our three major strategic initiatives – TCS Closets, Contained Home and POP! – remains on track, as planned, and we’re encouraged by the start of the ‘snowballing effect’ on their results. As we expected, we’ve seen that, in general, our stores with the strongest comparable store sales increases are the ones that have had TCS Closets and Contained Home the longest. In fact, if we isolate our seven Dallas-area stores, TCS Closets alone added three percentage points of incremental comparable store sales to those stores in the first quarter of fiscal 2015. We remain confident in, and are maintaining, our previously stated sales and EPS outlook for the fiscal year.”
The Container Stores shares gained 1.10 or 6.34% on Tuesday in after-hours to 18.61.