Express reports EPS in-line, revs in-line, comps in-line with preannouncement; guides Q1 and FY EPS below consensus :
- Reports Q4 (Jan) earnings of $0.29 per share, in-line with the Capital IQ Consensus of $0.29; revenues fell 11.3% year/year to $678.8 mln vs the $675.07 mln Capital IQ Consensus.
- On January 10, co lowered Q4 comp guidance to -13% from -LDD; reaffirmed EPS $0.26-0.30.
- Comparable sales (including e-commerce sales) decreased 13%, compared to a 4% increase in the fourth quarter of 2015. E-commerce sales increased 9% to $170.1 million.
- Merchandise margin declined by 330 basis points driven by increased promotional activity. Buying and occupancy as a percentage of net sales rose by 230 basis points. In combination, this resulted in a 560 basis point decline in gross margin, representing 28.4% of net sales compared to 34.0% in last year's fourth quarter.
- Co issues downside guidance for Q1, sees EPS of ($0.04)-0.00 vs. $0.15 Capital IQ Consensus; comps down high single digits.
- Co issues downside guidance for FY18, sees EPS of $0.65-0.73 vs. $0.87 Capital IQ Consensus; comps flat to up low single digits.
- "Despite ongoing pressures in the retail sector, our fourth quarter earnings were in line with previously issued guidance. As expected, our store performance continued to be impacted by challenging mall traffic and a promotional retail environment. As our industry adapts to changing consumer preferences, we continue to invest in our omni-channel and marketing capabilities to ensure that we capitalize on this evolution. As a result, e-commerce sales made up 25% of fourth quarter net sales, with sales increasing 9% over the prior year period. We also remain intensely focused on managing our overall cost structure and optimizing our store footprint. Our balance sheet remains strong with more than $200 million in cash and we continue to have solid cash flow."
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