Tags: holiday | sales | apparel | Express

Apparel Retailer Express Warns of Weak Holiday Quarter

Wednesday, 04 Dec 2013 10:01 AM

Apparel retailer Express Inc. joined other U.S. retailers in forecasting a weaker-than-expected holiday quarter due to muted Thanksgiving sales and a highly promotional environment.

Express's shares fell as much as 20 percent in premarket trading.

Retailers from Urban Outfitters Inc. to Wal-Mart Stores Inc. are bracing for what is expected to be the toughest holiday shopping season since 2008 as customers are increasingly budget-conscious and value-focused.

"Thanksgiving week sales exceeded last year's, however results did not meet our expectations," Chief Executive Michael Weiss said in a statement.

"We had been planning for a promotional holiday season but we now expect the intensity of those promotions to reach heightened levels."

Heavy discounting hurt U.S. retail sales during the Thanksgiving weekend as shoppers spent about 3 percent less than they did a year earlier, industry group National Retail Federation said on Sunday.

While Express's trendy merchandise has clicked with shoppers in the past, its disappointing forecast suggests that tough times lie ahead.

Last month Ann Inc., parent of the Ann Taylor and LOFT women's apparel chains, also forecast holiday sales that missed analysts' estimates. The company had been outperforming other retailers because of its more fashionable merchandise.

Express said on Wednesday it expects a profit of 66-71 cents per share for the fourth quarter ending Feb. 1, 2014. Analysts on average are expecting a profit of 78 cents per share, according to Thomson Reuters I/B/E/S.

The weak forecast led it to cut its full-year earnings forecast to $1.46-$1.51 per share, from $1.52-$1.60.

Analysts on average were expecting a profit of $1.61 per share.

Express said net income rose to $19.3 million, or 23 cents per share, in the third quarter ended Nov. 2, from $17.4 million, or 20 cents per share, a year earlier.

Analysts were expecting a profit of 25 cents per share.

Sales rose 7 percent to $503 million, while comparable sales rose 5 percent in the quarter.

Express shares were trading at $19.80 before the bell. They closed at $24.67 on the New York Stock Exchange on Tuesday.

© 2017 Thomson/Reuters. All rights reserved.

   
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Apparel retailer Express Inc.joined other U.S. retailers in forecasting a weaker-than-expected holiday quarter due to muted Thanksgiving sales and a highly promotional environment.
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2013-01-04
Wednesday, 04 Dec 2013 10:01 AM
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