ENP Newswire -
Release date- 22082014 -
For the fiscal second quarter of 2014, the Company reported earnings per diluted share of
'We have entered the third quarter with fresh fall fashion and clean inventory levels at both brands. While the environment has been choppy this year, both Ann Taylor and LOFT will be offering her great feminine fashion and outstanding value to meet all of her wardrobing needs for the Fall season.
'In addition, we continue to make progress on our strategic growth initiatives, which offer significant potential to further expand our brands, broaden our client base and drive long-term growth and, as always, we are highly committed to further enhancing shareholder value,' stated
Fiscal 2014 Second Quarter Results
Total net sales for the second quarter of fiscal 2014 were
At LOFT, total brand comparable sales decreased 4.1%, reflecting a decrease of 5.2% at LOFT and an increase of 0.3% in the
Gross margin, as a percentage of net sales, was 52.4%, versus the 54.7% gross margin rate achieved in the second quarter of 2013, reflecting an overall decrease in merchandise margin as a result of higher-than-anticipated promotional activity.
Selling, general and administrative expenses for the second quarter of 2014 were
The Company reported operating income of
The Company ended the quarter with
Total inventory per square foot at the end of the second quarter increased 1% versus year-ago, reflecting a 10% increase at Ann Taylor, and decreases of 2% at LOFT and 2% in the factory/outlet channel. The increase at Ann Taylor reflects a shift in the timing of receipts for Fall product as well as a change in merchandise mix.
During the second quarter of fiscal 2014, the Company opened 17 stores, comprised of two
First Half Fiscal 2014 Results
Net sales for the first six months of fiscal 2014 were
Gross margin, as a percentage of net sales, was 52.8% in the first half of 2014, compared with 55.2% in the first half of 2013, reflecting an overall decrease in merchandise margin rate as a result of higher-than-anticipated promotional activity during the first half of 2014.
Selling, general and administrative expenses for the first half of 2014 were
The Company recorded a pre-tax restructuring charge of
For the fiscal first half of 2014, the Company reported operating income of
Net income for the first half of 2014 was
Outlook for Fiscal Third-Quarter and Full-Year 2014
For the fiscal third quarter of 2014, the Company expects total net sales to be
For fiscal 2014, the Company provided the following outlook:
Total net sales are expected to be
Total SG&A expenses are expected to be
Our effective tax rate is expected to be 40%.
Capital expenditures are expected to be approximately
Total weighted average diluted shares outstanding are expected to be 46.9 million, which includes the effect of participating securities.
Total weighted average square footage for fiscal 2014 is expected to increase approximately 2%, reflecting the opening of approximately 50 new stores, partially offset by the impact of downsizes at Ann Taylor stores and approximately 40 store closures. The Company expects to have approximately 1,035 stores at fiscal year-end.
The Company expects to maintain its healthy balance sheet, including a disciplined approach to inventory management throughout the fiscal year.
Certain statements in this press release are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements may use the words 'expect,' 'anticipate,' 'plan,' 'intend,' 'project,' 'may,' 'believe' and similar expressions. Forward-looking statements also include representations of the expectations or beliefs of the Company concerning future events that involve risks and uncertainties, including:
the Company's ability to anticipate and respond to changing client preferences and fashion trends and provide a balanced assortment of merchandise that satisfies client demands in a timely manner;
the effectiveness of the Company's brand awareness and marketing programs, its ability to maintain brand image, engage new and existing clients, drive traffic to its stores and websites and gain market share;
the effect of competitive pressures from other retailers;
the Company's reliance on key management and its ability to hire, retain and develop qualified associates as well as ensure that the Company has the appropriate organizational structure and processes in place to achieve its strategic initiatives;
the performance and operation of the Company's websites and the risks associated with Internet sales;
the impact of a privacy breach and the resulting effect on the Company's business and reputation;
the Company's reliance on third-party manufacturers and key vendors, including operational risks such as reduced production capacity, errors in complying with merchandise specifications, insufficient quality control and failure to meet production deadlines;
the impact of fluctuations in sourcing costs, in particular, increases in the costs of raw materials, labor and transportation;
the Company's reliance on foreign sources of production and the associated risks of doing business in foreign markets;
the Company's dependence on its
the Company's ability to successfully upgrade and maintain its information systems in a timely and secure manner to support the needs of the organization and to operate in accordance with its business continuity plan in the event of a disruption;
the Company's ability to successfully optimize implementation of its omni-channel retail strategy and maintain a relevant and reliable omni-channel experience for its clients;
the Company's ability to manage inventory levels and changes in merchandise mix as well as optimize the operational aspects of its omni-channel fulfillment strategy;
the Company's ability to successfully execute brand goals, objectives and new concepts and strategies, including international expansion;
the Company's ability to secure and protect trademarks and other intellectual property rights;
a significant change in the regulatory environment applicable to the Company's business and the Company's ability to comply with legal and regulatory requirements;
the effect of general economic conditions on consumer spending and the Company's liquidity and capital resources;
the impact of fluctuations in sales and profitability on the Company's stock price;
the failure by independent manufacturers to comply with the Company's social compliance program requirements or applicable laws and regulations;
the potential impact of natural disasters, extreme weather, public health concerns, acts of war or terrorism in
the Company's ability to successfully manage store growth and optimize the productivity and profitability of its store portfolio;
the Company's dependence on shopping malls and other retail centers to attract clients and the impact of potential consolidation of commercial and retail landlords on the Company's ability to negotiate favorable rental terms; and
the effect of tax matters on its business operations.
Further description of these risks and uncertainties and other important factors are set forth in the Company's latest Annual Report on Form 10-K, including but not limited to Item 1A - Risk Factors and Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations therein, and in the Company's other filings with the
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS: See Full Press Release at:
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