Express meets top of guidance in Q2, updates FY2017 guidance following
Express reported on Wednesday its second quarter results that were at the top end of its guidance.
The specialty retailer said in June that it expects its second quarter comparable sales to be in the negative mid-single digits and its net loss to range from $(19) million to $(16) million.
The comparable sales for the quarter, including e-commerce sales, decreased 4% compared to an 8% decrease in the previous year, and the net loss in the second quarter was $11.8 million or $0.15 per diluted share, which includes a net negative $0.16 per diluted share impact from the exit of its Canadian business. Express reported a net income of $10.1 million, or $0.13 per diluted share, in the prior year.
In addition, net sales fell 5% to $478.5 million from $504.8 million in the prior year and e-commerce sales increased 28% year over year to $90.0 million.
“We expect e-commerce sales growth to remain solid and store performance to sequentially improve, driven in part by our expanded omni-channel capabilities,” said President and CEO David Kornberg.
“We remain focused on managing our costs and see clear opportunities to enhance the overall efficiency of our business. Our balance sheet remains strong with more than $170 million in cash and no debt, and we continue to expect to generate solid cash flow. Our confidence in our strategy and conviction in our long-term opportunity remains resolute and we are committed to driving shareholder value.”
Also in the second quarter, merchandise margin fell by 120 basis points, due to highly promotional activity and the exit from Canada, SG&A expenses were $131.7 million compared to $133.2 million in the previous year, and operating loss was $15.9 million and includes a negative $17.6 million impact related to the exit from Canada.
Following the performance, Express expects third quarter comparable sales to be in the negative low single digits, net income to range from $5 million to $8 million, and diluted EPS to range from $0.06 to $0.10. The specialty retailer updated its full year 2017 results and now expects comparable sales to be in the negative low single digits and the net income to be between $20 million and $26 million compared to the previous expectation of $16 million to $22 million.
Copyright © 2020 FashionNetwork.com All rights reserved.