Harry & David Holdings generated $362.4 million during the second quarter of fiscal 2006, up from $334.9 million in fiscal 2005. But the fruit and gourmet foods gift marketer’s net income between the quarters dropped, from $69.6 million to $49.1 million.
For the first six months of fiscal 2006, the Medford, OR-based firm reported sales of $420.1 million, up from $388.6 million. But its net income dropped from $48.9 million to $31.8 million. The quarter ended Dec. 24.
The company attributed the drop in income to increased delivery and transportation costs, as well as the impact of higher than anticipated price-promotional activity, including delivery discounts and product markdowns.
Within its direct marketing operations, the company generated $257.9 million during the second quarter, a 7.4% increase from second quarter 2005. The gain came primarily as a result of increases in catalog, direct mail and online promotional activity. Response rates rose from 2.76% in second quarter 2005 to 2.81% in second quarter 2006.
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