Chico's growth chugs along

Chico's FAS Inc. earned $28.8 million in net income on $483 million in third-quarter net sales, representing a 27% growth in profits from an 8.1% increase in revenues.

Its nine-month profits have nearly doubled over the year, from $52.1 million in 2009 to $94.7 million this year.

The largest contributor to Chico's most recent sales growth was its direct-to-consumer (online) sales division. The company did $34.4 million in online business — a relatively small portion of its overall sales, but 41% higher than last year. In other words, increased online sales contributed roughly 28% of the year-over-year growth in Chico's overall net sales activity.

Comparable store sales grew as well, with a 3.1% year-over-year increase. That pace is considerably slower than that of last year, when same store sales grew 12.8%.

Chico's gross profits — simply net sales less the cost of goods sold — were down as a percentage of sales. In a release, the company explained that it had been employing higher markdowns in its frontline stores to stir up sales, although those were offset slightly by better margins at its outlet stores.

The company spent $9.9 million more on its selling, general and administrative expenses, a 4.5% increase from last year. Of that, $7 million was used to buy television advertising for the company's Soma brand. Those increased expenses also include costs associated with the opening of 64 net new stores.

Chico's FAS Inc. operates 1,153 stores throughout the United States, U.S. Virgin Islands, and Puerto Rico