US: Children's Place cuts full-year outlook after Sandy
- Q3 profit slides 4% to $35m
- Sales rose 3% to $500.9m
- Company lowered FY EPS to $3.10-$3.15
The Children's Place has cut its full-year earnings target after increasing its promotional activity to clear inventory in the wake of Hurricane Sandy.
The children's apparel retailer said net income "exceeded expectations" by declining 4% to US$35m during the three months to 27 October. On an adjusted basis, net income increased 15.7% to $39m.
The company, which operates 1,102 stores, saw sales climb 3% to $500.9m, while comparable retail sales edged up 1.1%.
CEO and president Jane Elfers said: "Over 280 of our stores and our Northeast e-commerce business, which together account for approximately 31% of total company revenues, were impacted.
"We still expect to deliver positive comparable retail sales, but we are adjusting the margin and earnings outlook for the quarter and fiscal 2012 due to the heightened promotional environment post-Sandy."
The company now expects full-year earnings per share to range from $3.10 to $3.15, against its previous guidance of between $3.20 and $3.30.
|The Children's Place Reports Third Quarter 2012 Financial Results|
Management Updates Fiscal 2012 Earnings Guidance
SECAUCUS, N.J., Nov. 15, 2012 (GLOBE NEWSWIRE) -- The Children's Place Retail Stores, Inc. (Nasdaq:PLCE), the largest pure-play children's specialty apparel retailer in North America, today announced third quarter net sales increased 3% to $500.9 million for the thirteen weeks ended October 27, 2012, compared to $484.1 million in the third quarter of 2011. Comparable retail sales increased 1.1% in the quarter.
GAAP net income was $35.0 million, or $1.44 per diluted share, in the third quarter of 2012. As adjusted, net income was $39.0 million, or $1.60 per diluted share, in the third quarter of 2012, compared to $33.7 million, or $1.33 per diluted share, in the third quarter of 2011.
Adjusted net income is a non-GAAP measure. The Company believes the excluded transactions are not indicative of the performance of its core business and that by providing this supplemental disclosure to investors it will facilitate comparisons of its past and present performance. A reconciliation of net income as reported is included in this press release in Table 3.
"Our third quarter earnings per share exceeded our expectations. We had strong sales results in our e-commerce and outlet channels, and continued positive momentum in our big kids business throughout the quarter," commented Jane Elfers, President and Chief Executive Officer. "Entering the fourth quarter, Hurricane Sandy had a devastating impact on our region, and our deepest sympathy goes out to all who were affected. Over 280 of our stores and our Northeast e-commerce business, which together account for approximately 31% of total company revenues, were impacted. We still expect to deliver positive comparable retail sales, but we are adjusting the margin and earnings outlook for the quarter and fiscal 2012 due to the heightened promotional environment post-Sandy."
Net sales increased 3% to $1,300.3 million fiscal year-to-date 2012, compared to $1,258.4 million for the same period last year. Comparable retail sales increased 1.1% fiscal year-to-date 2012.
GAAP net income for fiscal year-to-date 2012 was $40.6 million, or $1.66 per diluted share. As adjusted, net income was $51.0 million, or $2.09 per diluted share, compared to $53.0 million, or $2.05 per diluted share, for the same period last year.
Store Openings and Closures
During the third quarter of 2012, The Children's Place opened 23 stores and closed one. Fiscal year-to-date 2012, the Company has opened 60 stores and closed seven.
Share Repurchase Program
During the third quarter, the Company repurchased 222 thousand shares for approximately$12.8 million. During the first nine months of fiscal 2012, the Company repurchased 935 thousand shares for approximately $47.7 million. At the end of the quarter, there was approximately $21.6 million remaining of the $50 million share repurchase program which was authorized by the Board of Directors in March 2012. Under the 2012 share repurchase program, the Company may repurchase shares in the open market at current market prices at the time of purchase or in privately negotiated transactions. The timing and actual number of shares repurchased under the program will depend on a variety of factors including price, corporate and regulatory requirements, and other market and business conditions. The Company may suspend or discontinue the program at any time, and may thereafter reinstitute purchases, all without prior announcement.
The Company updated its earnings guidance for fiscal 2012 and now projects that non-GAAP adjusted earnings per diluted share will be between $3.10 and $3.15, compared to its previous guidance of $3.20 to $3.30, assuming positive low-single digit comparable retail sales.
The Company provided initial guidance for the fourth quarter of 2012, and is forecasting non-GAAP adjusted earnings per diluted share between $1.01 and $1.06, assuming positive low-single digit comparable retail sales.
The Company now expects gross margin to expand 170 to 190 basis points in the fourth quarter, and to deleverage 50 to 70 basis points for fiscal 2012. SG&A is expected to be flat as a percent of sales in the fourth quarter, and to deleverage 10 to 20 basis points for fiscal 2012.
This earnings guidance assumes that currency exchange rates will remain consistent with today's rates, and does not include the impact of further potential share repurchases.
Conference Call Information
The Children's Place will host a conference call to discuss its third quarter 2012 results today at 8:00 a.m. Eastern Time. The call will be broadcast live athttp://investor.childrensplace.com. An audio archive will be available on the Company's website approximately one hour after the conclusion of the call.
About The Children's Place Retail Stores, Inc.
The Children's Place is the largest pure-play children's specialty apparel retailer in North America. The Company designs, contracts to manufacture and sells fashionable, high-quality merchandise at value prices, primarily under the proprietary "The Children's Place" brand name. As of October 27, 2012, the Company operated 1,102 stores and an online store atwww.childrensplace.com.
Original source: http://phx.corporate-ir.net/phoenix.zhtml?c=120577&p=irol-newsArticle&ID=1759058&highlight=
Childrenswear in Canada industry profile provides top-line qualitative and quantitative summary information including: market size (value 2008-12, and forecast to 2017). The profile also contains desc...
British fashion retailer Primark and Canadian brand Joe Fresh have confirmed that their garments were being manufactured in one of the Bangladesh factories that collapsed on Wednesday (24 April), kill...
Childrenswear in the United States industry profile provides top-line qualitative and quantitative summary information including: market size (value 2008-12, and forecast to 2017). The profile also co...
Labour rights groups and unions have stepped up their calls for urgent action to improve worker health and safety in Bangladesh's ready-made garment industry, as the death toll from the collapsed Rana...
Global Childrenswear industry profile provides top-line qualitative and quantitative summary information including: market size (value 2008-12, and forecast to 2017). The profile also contains descrip...
A group of Western clothing retailers and brands have agreed to a deadline later this month to finalise a fire and building safety plan aimed at preventing industrial disasters like the collapse last ...
Apparel Retail in Canada industry profile provides top-line qualitative and quantitative summary information including: market size (value 2008-12, and forecast to 2017). The profile also contains des...
- PSF 2014: No one size fits all in apparel sourcing
- PSF 2014: Shifting focus from cost to consumer
- Garment manufacturers eye Myanmar outsourcing
- Teen retail being rocked by fast fashion headwinds
- Bangladesh industry development moving backwards
- Adidas China supplier in discussions over strike
- Gap issues mirror widespread industry challenges
- H&M "pushing the process" on sustainable fashion
- Bangladesh PM asks clothing buyers to pay more
- Adidas plans mobile phone hotline at all suppliers
- Ethiopia – the emerging textile and clothing industry
- Antimicrobial fibres, fabrics and apparel: innovative weapons against infection
- Trade and trade policy: clothing imports, consumer expenditure and trends in five emerging markets: Brazil, Colombia, India, Kazakhstan and Peru, 4th quarter 2013
- Sustainable Textiles for Apparel: Fact, Fiction and Future Prospects
- Jeans in Italy