Did you hear?… REI posts a $7.5 million profit

REI released its financial results for 2001 yesterday, and true to CEO Dennis Madsen’s promise a year ago to return REI to profitability, the company posted a $7.5 million profit on sales of $740.1 million. Last year, 2001, was a tough one for REI internally and in the public eye as the company sought to recover from its first-ever posted loss of $11.4 million. During the year, it shut down its store in Japan, trimmed operating and administrative expenses to 37 percent of revenue compared with 39.4 the year before, sold MSR to Cascade Designs, sold the company’s interest in Arc’Teryx, laid off employees at corporate, and moved retail stores around by closing two and opening two to better serve their customer base. SNEWS® View: Though not everyone at REI initially bought into the Madsen-led directive to refocus on the U.S., retail, and trimming costs, the results are clear and successful. Madsen and his team deserve a pat on the back. Even in a tough retail climate, REI’s overall sales climbed 2 percent at stores open a year or more. Online and catalog sales (we suspect the vast majority is from online) rose 26 percent to $116 million. Expect REI to strengthen its brand position by offering more REI product in the next year. Also, expect REI to continue its benevolent and industry-supportive ways with contributions in excess of $1 million toward environmental causes and inspiring youth to head outdoors.