US: Ann cuts full-year outlook on Hurricane Sandy
US women's wear retailer Ann Inc has lowered its full-year earnings guidance after Hurricane Sandy and increased promotions at its Loft division resulted in lower-than-expected fourth-quarter sales.
President and CEO Kay Krill said: "In terms of the fourth quarter, the drivers of the softer-than-expected results were twofold: First, Ann Inc has a high concentration of sales in the Northeast region, which were negatively impacted by the lingering effects of Hurricane Sandy.
"In addition, Loft's fourth-quarter investment in bright colours did not resonate with our clients this holiday season. As a result, promotions at Loft ramped up in the back half of the quarter, which pressured margins but effectively cleared through Holiday inventories in order to enter the spring season in a healthy position."
The company expects full-year net sales to be US$2.38bn against earlier guidance of $2.40bn, while fourth-quarter sales are forecast to be $608m, compared to its previously forecast $625m.
"Looking ahead, we have entered the first quarter with clean inventories at both brands, and we are well positioned to deliver profitable growth in fiscal 2013. We remain focused on continuing the successful roll-out of our strategic initiatives and remain confident that these will drive further long-term growth," Krill added.
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