Dress Barn Inc. ran counter to the retail trend with increases in profits and sales during its first quarter, but the operator of the Dress Barn and Maurices nameplates joined the chorus of firms making lower earnings estimates.
Net income for the three months ended Oct. 25 rose 4.4 percent to $20.5 million, or 32 cents a diluted share, from $19.6 million, or 30 cents, in the year-ago quarter. On average, analysts expected EPS of 27 cents.
Sales during the period rose 3.5 percent to $376.4 million from $363.7 million, but fell 1 percent on a same-store basis. Dress Barn division sales were up 2 percent to $232.8 million and comparable-store sales were flat. Maurices’ sales increased 6 percent to $143.6 million as comps declined 3 percent.
Based on “weakness in consumer spending that may well persist for the remainder of our fiscal year,” the company said it reduced earnings per share guidance for the full year to 90 cents to $1 from an previous range of $1.23 to $1.28. The projection assumes a midsingle-digit decrease in comps for the remaining nine months of the fiscal year.
“We are pleased to have generated solid first-quarter results that exceeded our expectations,” said David Jaffe, president and chief executive officer of the Suffern, N.Y.-based specialty retailer. “In view of the current condition of the consumer market, we have carefully adjusted our inventory levels and promotional strategy.”
At the end of the first quarter, Dress Barn operated 841 stores under its corporate nameplate and 692 Maurices stores.