NEW YORK — Greg Weaver, outgoing chief executive officer of Pacific Sunwear of California Inc., will focus on either launching a new concept or looking at acquisitions for the company when he leaves his post in April.
Weaver, who will then also transition to the role of executive chairman, disclosed his plans on Monday during the company’s third-quarter conference call to Wall Street. He will be succeeded by Seth Johnson, the former chief operating officer of Abercrombie & Fitch Inc., as the company announced in mid-October. Johnson became chief operating officer Nov. 1 and will become ceo in the spring.
Pacific Sunwear posted a 30.1 percent gain in income for the three months ended Oct. 30, easily beating analysts’ projections. Earnings in the first nine months of the fiscal year jumped 44.3 percent.
For the quarter, the Anaheim, Calif.-based company reported earnings of $31.9 million, or 42 cents a diluted share, compared with $24.5 million, or 31 cents, in the year-ago period. Analysts were expecting earnings per share of 40 cents. Sales jumped 17 percent to $329.1 million from $281.3 million last year, while consolidated same-store sales increased 6.6 percent. Comps at PacSun stores were up 6.8 percent, while comps at its D.e.m.o. chain rose 4.8 percent, against a 20 percent increase in the third quarter last year, company executives said during the call.
“Our business remained very strong in the third quarter despite very challenging comps in both PacSun and D.e.m.o.,” Weaver told analysts.
Weaver said quarterly same-store sales in PacSun’s men’s business rose 5.5 percent, while comps for its young women’s business advanced 8.5 percent. At D.e.m.o., comps for men’s dropped 3 percent, but surged 17 percent for its young women’s business.
Weaver said once he transitions to executive chairman, he expects to be in the Pacific Sunwear office probably two days each week. He also noted that the company expects to fill the post of chief financial officer in the next couple of weeks. The specialty retailer is also searching for a new president of D.e.m.o.
In the first nine months of fiscal 2004, PacSun’s earnings were $66.2 million, or 85 cents a diluted share, up from last year’s profit of $45.9 million, or 59 cents. Sales rose 18.9 percent to $849 million.
The firm forecasted same-store sales in the fourth quarter to grow 5 percent and said it is “comfortable” with analysts’ consensus for EPS of 52 cents. The company also lifted its full-year profit guidance to $1.36, compared with the Street consensus of $1.35.