US: Ann Inc cuts sales outlook on Loft weakness
US women's apparel group Ann Inc has lowered its sales guidance for the second quarter, blaming weakness at its Loft brand.
The company now expects net sales to be $648m, reflecting a 2.3% comparable sales decline. This is lower the $670m it forecast earlier, with a comparable sales increase in the low-single digits.
According to Stifel analyst Richard Jaffe, management lowered its guidance to an implied earnings per share of $0.67 from its previous implied guidance of $0.82.
During the quarter, comparable sales edged at the Ann Taylor brand edged up 0.7%, reflecting an increase of 2% at Ann Taylor partially offset by a decline of 1.9% in the Ann Taylor Factory channel.
The Loft brand, however, saw comparable sales fall 4.1%, reflecting a decline of 5.2% at Loft and an increase of 0.3% in the Loft Outlet channel.
"Despite positive performance through mid-June, the remainder of the second quarter proved more challenging, with soft traffic across the industry and a highly promotional environment," noted president and CEO Kay Krill.
Loft experience softness in basic knit tops, which Krill said represent a "meaningful" component of Loft's summer assortment. After moving through summer product, the company ended the quarter with clean inventories, he added.
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