• Q2 loss narrows to $10.7m 
  • Sales up 0.6% to $384.6m
  • Company to open stores in India

The Children's Place has lifted its full-year earnings guidance after narrowing its loss in the second quarter, and unveiled plans to expand into India through franchise stores.

The US apparel retailer's net loss amounted to US$10.7m for the 13 weeks to 2 August, compared to a loss of $23.6m in the same period a year ago.

Net sales climbed 0.6% to $384.6m from $382.4m last year, while comparable retail sales edged up 0.8%. Gross margin fell 200 basis points to 31%, primarily due to fixed cost and merchandise margin deleverage.

"Our sales improved significantly in the second quarter, reflecting a rebound in shopping activity with more normalised weather pattern," said president and CEO Jane Elfers.

"While we expect the sector to remain highly promotional and the uncertainty surrounding the economy to continue, we are well positioned to compete effectively in the back half of 2014 and we are updating our full year guidance."

The company now expects full-year adjusted net income per share to range from $2.95-$3.05, compared to its earlier guidance of $2.90-$3.05, assuming comparable retail sales will be flat to down 1%.

The Children's Place has entered into a franchise agreement with Arvind Lifestyle Brands Limited to open up to 50 stores in India, with the first ones set to open in autumn 2015.