Tuesday, August 18, 2009

Saks Posts Lost, Beats Wall St. Exprectations

Saks quarterly loss not as deep as expected
Tue Aug 18, 2009 9:23am EDT

CHICAGO, Aug 18 (Reuters) - Upscale department store operator Saks Inc (SKS.N) posted a narrower-than-expected quarterly loss on Tuesday as it trimmed costs while well-heeled shoppers held back from pricey purchases.

Saks' net loss widened to $54.5 million, or 39 cents per share, in the fiscal second quarter ended on Aug. 1, from $32.7 million, or 24 cents per share, a year earlier.

Excluding impairments and dispositions and a gain on the extinguishment of debt, Saks lost 40 cents per share, less than analysts' average forecast of a loss of 52 cents per share, according to Reuters Estimates.

Shares of Saks, which have more than tripled in value from their March lows, rose 7.7 percent to $5.76 in premarket trading.

The recession, an unsteady stock market since September and job losses have curbed consumers' ability to spend freely in Saks' stores. To offset languishing sales, Saks has been cutting costs and trimming inventory.

Sales fell 14.5 percent to $561.7 million, with same-store sales down 15.5 percent.

Saks, which sells designer brands such as Marc Jacobs, Versace and Oscar de la Renta, said the sales decline at its New York City flagship store continued to be steeper than at other existing locations.

The current climate makes it very difficult to predict sales and gross margin performance with any certainty, Chief Executive Stephen Sadove said in a statement.

Saks expects same-store sales to fall in a mid-to-high single digit range in the second half of the year, with the third quarter being weaker than the fourth.

It still expects same-store sales to fall in a low double digit range for the full year. Same-store sales fell 22.4 percent in the first half of the year.

Saks expects gross margins to rise in the second half of the year, partly because it is carrying less inventory.

The company is also cutting other costs. It aims to spend about $55 million on capital projects this year, after spending about $75 million last year.

(Reporting by Jessica Wohl, with additional reporting by Aarthi Sivaraman in Seattle, editing by Gerald E. McCormick)

(SOURCE: Reuters.com)

Friday, August 14, 2009

Abercrombie & Fitch Post 2Q Loss on Sales Tumble

Abercrombie Has Loss on Sales Slump, Ruehl Stores

By Allison Abell Schwartz

Aug. 14 (Bloomberg) -- Abercrombie & Fitch Co., the U.S. teen clothing retailer, reported a second-quarter loss on slumping sales and costs to close Ruehl stores. The shares rose on investor optimism results will improve in the second half.

The net loss was $26.7 million, or 30 cents a share, compared with a profit of $77.8 million, or 87 cents, a year earlier, the New Albany, Ohio-based company said today in a statement. Revenue dropped 23 percent to $648.5 million, in line with preliminary figures released last week.

Chief Executive Officer Michael Jeffries started to lower prices in the second quarter to compete with other retailers such as Aeropostale Inc. and American Eagle Outfitters Inc., which have used discounts to lure consumers on tight budgets. Pricing changes, inventory management and improved fashion should help results later this year and in 2010, said Richard Jaffe, an analyst at Stifel, Nicolaus & Co. in New York.

The second quarter showed “modest improvement,” Jaffe said in a research note today. Excluding some items, earnings were 4 cents a share, beating his estimate for a loss of 3 cents.

Marketing, general and administrative expenses declined 19 percent in the quarter to $88.7 million.

Sales at stores open at least a year dropped 30 percent in the three months ended Aug. 1, the company said last week.

The retailer said on June 17 it would close its 29 unprofitable Ruehl stores that carry clothing for 22- to 25-year olds after sales stagnated in the U.S. recession.

Abercrombie rose $1.29, or 3.9 percent, to $34.25 at 4:15 p.m. in New York Stock Exchange composite trading. The shares have gained 48 percent this year.

(SOURCE: Bloomberg.com)

Escada Files For Bankruptcy

Escada Files for Court Protection in Germany
August 14, 2009

FRANKFURT (AP) — The German fashion company Escada has filed for bankruptcy after being unable to obtain financing, a Munich district court said Thursday.

The filing was expected after the company, famous for women’s fashion and accessories, failed to get the necessary support for an earlier bond swap.

Escada was once one of the biggest fashion brands in the world, but its popularity, sales and earnings have declined.

The company said a number of restructuring measures had been contingent on the bond swap working, but it did not get enough support from the bondholders.

For example, a plan to raise 30 million euros, or $42 million, through the company’s bigger investors had been contingent on the bond exchange going through, as was a credit extension of more than 13 million euros. A successful swap would have also given the company some immediate liquidity to help it eliminate some of its debt.

The company said earlier this week that the situation was “regrettable,” but that it still hoped for a turnaround in its finances and business.

The company had sales of 528 million euros in fiscal year 2008, but reported a net loss of 70 million euros. In the first half of the fiscal year ending in April, it lost 92 million euros.

Escada operates 182 of its own shops and 225 franchise shops in more than 60 countries, employing about 2,300, 600 of those in Germany.

(SOURCE: NYTimes.com)

Estee Lauder Shares Decline Following 4th-Quarter Loss

Estee Lauder declines following 4th-quarter loss

(AP) – Aug 14, 2009

NEW YORK — Shares of Estee Lauder Cos. followed the broader markets lower Friday after the cosmetics company posted a fiscal fourth-quarter loss because of hefty restructuring charges and unfavorable exchange rates.

On Thursday, Estee Lauder, which is currently restructuring its business, said it swung to a loss of $17.9 million because of big restructuring charges.

Estee Lauder's restructuring plan includes cutting 2,000 jobs, or 6 percent of the work force, and maintaining a hiring freeze. The company has been hurt by softening consumer spending and deterioration in airline travel because the company sells its products in airports.

Revenue declined 16 percent to $1.68 billion because of unfavorable foreign currency translation and waning consumer discretionary spending.

Deutsche Bank analyst Bill Schmitz Jr., who rates the stock "Hold," said the company is doing what it can to manage expectations.

"The problem with the stock is that much of this is already priced in and newly named Chief Executive Fabrizio Freda has, in short-time, attained rock star status with investors," Schmitz said.

Shares of the company are up 22.1 percent so far this year. In afternoon trading, shares declined $1.73, or 4.6 percent, to $36.08.

Elsewhere on Friday, stocks fell sharply Friday, following news that the Reuters/University of Michigan index of consumer sentiment fell short of expectations for the first part of August. That may indicate consumer spending — which accounts for two-thirds of all U.S. economic activity — will remain tough amid layoffs.


Thursday, August 13, 2009

Nordstrom 2Q Profit Drops 27%; Raises Guidance

Nordstrom meets Street, raises guidance

Thu Aug 13, 2009 4:49pm EDT

SAN FRANCISCO (Reuters) - Nordstrom Inc (JWN.N) posted a steep decline in quarterly profit on Thursday that nevertheless met Wall Street's expectations, as the upscale department store chain controlled inventory and expenses to offset languishing sales.

The company raised its profit forecast for the fiscal year based on what it called better-than-expected performance in its second quarter. The quarter included three major sales campaigns, making it Nordstrom's second-largest in terms of net sales.

Nordstrom's net profit fell 26.6 percent to $105 million, or 48 cents per share, in the fiscal second quarter ended August 1, compared with $143 million, or 65 cents per share, a year earlier.

That matched the 48 cents per share expected, on average, by analysts, according to Reuters Estimates.

Sales fell 6.2 percent to percent to $2.14 billion, a touch above the $2.12 billion expected by analysts. But same-store sales, a key measure of sales at stores open at least one year, fell 9.8 percent.

For fiscal 2009, Nordstrom estimated earnings of $1.50 to $1.65 a share, with same-store sales falling by 9 percent to 12 percent.

An earlier forecast called for earnings per share of $1.25 to $1.50. Wall Street had been expecting fiscal 2009 earnings per share of $1.48.

Nordstrom shares fell less than 1 percent to $29.52 after closing up 1 percent at $29.76 on the New York Stock Exchange.

(Reporting by Alexandria Sage; Editing by Richard Chang)

(SOURCE: Reuters.com)

Elizabeth Arden Posts Narrow Loss, Stock Down on View

Elizabeth Arden posts loss, stock down on view

LOS ANGELES, Aug 13 (Reuters) - Elizabeth Arden (RDEN.O) reported a narrower quarterly loss on Thursday as shoppers continued to spend conservatively on perfume and face creams, but shares fell 4.1 percent after its 2010 profit forecast missed expectations.

Net loss at Arden was $3.6 million, or 13 cents per share, for the fiscal fourth quarter ended June, 30, narrowing from its year-earlier net loss of $10.4 million, or 38 cents per share.

Excluding restructuring and other expenses, its net loss was 7 cents per share. That just beat the 8-cent loss expected by analysts, according to Reuters Estimates.

Net sales at Arden, which sells Prevage anti-aging cream and perfumes by celebrities such as Britney Spears and Mariah Carey, fell 10 percent to $212.6 million. Excluding the unfavorable impact of foreign currency translation, net sales declined 5.8 percent.

For its fiscal year ended June 2010, the company forecast a 2 percent to 3.5 percent increase in sales and earnings per share in the range of 50 cents to 65 cents per share.

Analysts, on average were looking for a 2010 profit of 72 cents per share, according to Reuters Estimates.

Shares in Arden, which closed at $10.45, fell to $10.02 in extended trade on the Nasdaq.

(Reporting by Lisa Baertlein and Aarthi Sivaraman in Seattle; Editing Bernard Orr) 

(SOURCE: Reuters.com)

Wednesday, August 12, 2009

Macy's Profits Down, Outlook Up

Despite being bogged down with reorganization costs, Macy's, Inc. reported profits that were better-than-expected, and raised their outlook for fiscal year 2009.

The company's second quarter earnings were down to $7M, or $.02 per share, vs. $73M, or $.17 per share, from 2008. However, excluding restructing costs, earnings per share were $.20, still down from the previous year's E.P.S of $.29, but exceeding analysts' estimates of $.17 per share.
"We were able to exceed our expectations with strong earnings and cash flow in the second quarter, despite lower sales in an economic environment that continues to be very difficult," said Terry J. Lundgren, Macy's, Inc. chairman, president and chief executive officer. "In particular, we successfully lowered inventories and managed expenses to align more closely with current levels of business. Our second quarter same-store sales performed as well as or better than most department store retailers even while we were completing the largest organizational transition in Macy's recent history. Most of that transition work is behind us now.
The results from the company's "My Macy's" initiative continue to show promise:
"We continue to be very pleased with results from the My Macy's initiative, which began to roll out to 49 new districts nationwide in the second quarter. Same-store sales performance in the 20 pilot districts launched in 2008 continued to outpace the remainder of the company, and the gap continued to widen in the second quarter. Going forward, we expect the gap to become less meaningful as the 49 new districts launched in 2009 come up to speed and begin producing results that parallel the pilot districts. As previously stated, we expect to see some improvement in these new districts in the fourth quarter of 2009 and especially in spring 2010," Lundgren said.
The first half saw a loss of $.19 per share vs. earnings of $.03 per share in 2008. Minus restructuring costs, EPS was $.04 per share vs. $.28 in the first half of '08.

Sales for the 2nd quarter were down 9.7% to $5.164B from $5.718 in '08. Macy's same-store sales for the quarter dropped 9.5%. Online sales helped the company's 2nd quarter and first half '09 comp sales by 0.5%. Online sales, which count towards same-store sales, rose 9.4% in the 2nd quarter and 12.7% in the first half of fiscal 2009.

The company raise it's guidance on fiscal year 2009 earnings, projecting EPS will be $.70 to $.80 per share, excluding restructuring costs.

Macy's shares closed at $16.40, up 6%.

Friday, August 7, 2009

Limited Brands Declare Cash Dividend

COLUMBUS, Ohio, Aug 07, 2009 /PRNewswire-FirstCall via COMTEX/ --

Limited Brands (NYSE: LTD) announced today the declaration of its regular quarterly dividend of $.15 per share payable on September 11, 2009, to shareholders of record at the close of business on August 28, 2009. This is the Company's 139th consecutive quarterly dividend.


Limited Brands, through Victoria's Secret, Pink, Bath & Body Works, C.O. Bigelow, La Senza, White Barn Candle Co. and Henri Bendel, presently operates 3,006 specialty stores. The company's products are also available online at www.VictoriasSecret.com, www.BathandBodyWorks.com, www.HenriBendel.com and www.LaSenza.com.

SOURCE Limited Brands


Thursday, August 6, 2009

July Same-Store Sales Roundup

As The Four Tops sang, "It's the same ol' song..." for the U.S. retail industry.

For the 11th consecutive month, U.S retailers reported flat same-store sales, with many missing analysts' estimates. An unseasonably cool July and tax-free holidays pushed back to August, due to the Labor Day holiday falling late, were contributing factors to the decline in sales.

Although sales were down 5%, the results were on track with industry expectations and "consistent with the recent trends seen in May and June", according to Michael P. Niemira, chief economist of International Council of Shopping Centers (ICSC). In a telephone interview with Bloomberg, Mr. Niemera said, “Although July doesn’t look much different than June or even May, I think it will probably mark the turn in the industry towards better performance from here on out".

Apparel and Department Stores continue to be the worst performing sectors, however there were a few bright spots. Gap, Inc. and Macy's, Inc., posted better-than-expected 2nd quarter earnings, sending their shares to rise. Gap's shares saw it's biggest gain since Nov. 21. Limited Brands beat analysts' estimates, which caused shares to rise 15%, it's largest gain since Oct. 28.

Improvements in gross margin and expense reductions contributed to retailers’ ability to report second-quarter profit above estimates, according to Liz Dunn, an analyst at Thomas Weisel Partners LLC in New York. (Source: Bloomberg.com)
The S&P Retail Index rose 1.4%.

Here's the July Apparel/Dept. Store same-store sales roundup:

Limited Brands beat company and analysts' expectations, posting a 7% same-store sales decline for July. The company expects August comp. sales to decline in the high single-digits.

July same-store sales for Macy's, Inc. dropped 10.7%, above Thomson Reuter's analysts' estimates of a 9.1% decline. Total sales for July totaled $1.377B, a decline of 10.7% in comparison to sales of $1.543B for the same four week period ended in Aug. 2, 2008. Minus restructuring costs, Macy's, Inc. said it expects 2nd quarter earnings of $0.15 to $0.17 per share.

Gap Inc. posted an 8% same-store sales decline for July compared to an 11% drop in July 2008. Total sales were $924M, down 7%. Sabrina Simmons, CFO of Gap Inc., said the company expects earnings per share for the 2nd quarter to be between $0.30 and $0.32.

Dillard's comp. sales slid 12% coming above analysts' estimates of 10% declines. Total sales were down 15% for the month to $439,086,000.

Abercrombie & Fitch continues their downward spiral, with same-store sales falling 28% for July. Total sales for the month were down 22% to $236M. The company believes sales were negatively affected by a shift in the timing of tax-free holidays, and later back-to-school dates.

Nordstrom's same-store sales results dropped 6.9%, beating Wall St. estimates of a double-digit decline. Total sales slid 4.1% to $809M.

Saks slightly beat estimates, reporting a 16.3% decline in comp. sales. Analysts surveyed by Thomson Reuters estimated a 16.6% decline. Sales for the month totaled $159.7M, a 14.9% decrease.

Same-store sales for Neiman Marcus were down 27.3% to $195M for the month. Total sales decreased 25.8% to $199M. The company reported weakness across all merchandise categories and regions.