US action sportswear retailer Pacific Sunwear of California has cut its fiscal fourth-quarter earnings outlook, citing a "choppy" holiday season.
Comparable sales in the company's quarter ended 4 January were flat, the company said yesterday (9 January). These excluded online sales, which will be included in the figure going forward.
"After a strong start to the holiday season in November, the first three weeks of December were significantly below our expectations primarily due to a decrease in traffic and softness in denim," said CEO said Gary Schoenfeld. "Overall, it has been a choppy holiday season and we now expect fourth quarter comparable store sales to be flat to 1%, compared to last year."
On this basis, the company said it now expects non-GAAP loss per diluted share from continuing operations for the fourth quarter to be in the range of $0.21 to $0.18. This compares to guidance of 12 to 17 cents previously.
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Pacific Sunwear Reports Holiday Sales; Provides Update on Fourth Quarter Financial Outlook
Pacific Sunwear Reports Holiday Sales; Provides Update on Fourth Quarter Financial Outlook GlobeNewswire Pacific Sunwear of California, Inc. 12 hours ago ANAHEIM, Calif., Jan. 9, 2014 (GLOBE NEWSWIRE) -- Pacific Sunwear of California, Inc. (PSUN) (the "Company"), announced today that its fourth fiscal quarter comparable store sales through January 4, 2014 (the "Holiday Period") were flat on a continuing operations basis, excluding online sales. The Company stated that with the growing relevance of online sales in the marketplace, it will hereafter include online sales in its comparable store sales. Including online sales, comparable store sales during the Holiday Period increased 1% compared to the same period a year ago, on a continuing operations basis.
"After a strong start to the holiday season in November, the first three weeks of December were significantly below our expectations primarily due to a decrease in traffic and softness in denim. Business picked up in the final few days prior to Christmas and then finished the month strong as self-shoppers came back to the mall. Overall, it has been a choppy holiday season and we now expect fourth quarter comparable store sales to be flat to 1%, compared to last year," said Gary H. Schoenfeld, President and Chief Executive Officer.
Based on these recent trends, the Company now expects non-GAAP loss per diluted share from continuing operations for the fourth quarter of fiscal 2013 to be in the range of $(0.21) to $(0.18), which after adjusting for the 53rd week retail calendar shift, compares to $(0.20) last year.
The revised fourth quarter non-GAAP loss from continuing operations per diluted share guidance range is based on the following assumptions:
Comparable store sales, including online sales, from flat to 1%; Revenue from $211 million to $214 million; Gross margin rate, including buying, distribution and occupancy, of 19% to 20%; SG&A expenses in the range of $58 million to $59 million; and Applicable non-GAAP adjustments are tax effected using a normalized annual income tax rate of approximately 37%. About Pacific Sunwear of California, Inc.
Pacific Sunwear of California, Inc. and its subsidiaries (collectively, "PacSun" or the "Company") is a leading specialty retailer rooted in the action sports, fashion and music influences of the California lifestyle. The Company sells a combination of branded and proprietary casual apparel, accessories and footwear designed to appeal to teens and young adults. As of January 9, 2014, the Company operates 629 stores in all 50 states and Puerto Rico.
