April 21, 2010 / 12:28 PM / 8 years ago

UPDATE 2-Vitamin Shoppe Q1 beats; shares hit life-high

* Q1 EPS $0.32 vs est $0.27 - Thomson Reuters I/B/E/S

* Q1 rev up 11 pct to $191.6 mln vs est $188.6 mln

* Says sees cannibalization on its store base

* Shares up as much as 6 pct (Adds conference call and other details, updates stock activity)

April 21 (Reuters) - Health supplement retailer Vitamin Shoppe Inc (VSI.N) posted better-than-expected quarterly profit, helped by strong same-store sales and growth in its direct business, sending its shares up as much as 6 percent to their life-high.

Vitamin Shoppe plans to make $22 million of capital expenditures in 2010 as it opens 42 more stores, and said it sees cannibalization on its store base going forward.

Comparable sales guidance for the year reflects about 1 percent impact from that cannibalization, a company executive said on a conference call with analysts.

The company expanded its senior credit facility by $20 million to $70 million. It also plans to redeem an additional $25 million of floating rate notes, which would save $1 million of interest expense annually.

Gross margins for the quarter rose 90 basis points to 33.9 percent, partly helped by lower promotional activity.

    Net income for the quarter includes a pretax loss on extinguishment of debt of $0.6 million, or 1 cent a share, the company said.

    Revenue for the company, which opened 16 stores during the quarter, rose 11 percent to $191.6 million.

    Analysts on average were expecting earnings of 27 cents a share on revenue of $188.6 million, according to Thomson Reuters I/B/E/S.

    Same-store sales for the quarter rose 6.2 percent and Vitamin Shoppe said it continued to see mid-single digit growth for comparable sales in 2010.

    Direct business sales rose 7.8 percent, driven by growth in Vitamin Shoppe’s online business.

    Shares of the North Bergen, New Jersey-based company were up 5 percent at $24.33 Wednesday morning on the New York Stock Exchange. They touched a high of $24.70 earlier in the session. (Reporting by Shobhana Chadha in Bangalore; Editing by Maju Samuel, Unnikrishnan Nair)

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