US: Wet Seal warns of larger Q4 loss on sales declines
Wet Seal said it experienced a difficult fourth-quarter
The Wet Seal has said it expects to report a larger fourth-quarter loss than previously guided, due to lower-than-expected sales and higher promotional activity.
For the 13 weeks ended 1 February, sales dropped 22.8% to US$124.8m. Like-for-like sales fell 16.5% compared to a fall of 8.3% in the comparable period last year.
CEO John Goodman said the company had experienced a difficult fourth-quarter, marked by ongoing softness in mall traffic, and a highly promotional environment throughout the teen sector. This, he said, pressured merchandise margins.
"While we did not meet our expectations for the fourth quarter, we are encouraged by progress made during the course of fiscal 2013 under our turnaround plan," he added.
The company said it now expects to report a fourth-quarter loss per diluted share, before non-cash asset impairments, of around $0.24. This compares to previously announced guidance in the range of $0.14 to $0.17.
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