NEW YORK — Even though profits of Jones Apparel Group fell 70 percent in the first quarter, its shares rose Wednesday after it beat Wall Street's expectations.
For the three months ended April 1, income fell to $25.8 million, or 21 cents a diluted share, from $87 million, or 71 cents, in the same year-ago quarter. Excluding the loss from its Polo Jeans Co. sale and other one-time charges, Jones earned 66 cents a share, or 13 cents better than analysts' consensus estimate of 53 cents.
Revenues for the quarter dropped by 9.9 percent to $1.22 billion from $1.35 billion, which included a sales decline of 10.1 percent to $1.2 billion from $1.34 billion. Shares of Jones closed at $34.83, up 79 cents, in trading Wednesday on the New York Stock Exchange.
"I think in general it's safe to say we were pleased with the overall financial results in the first period, certainly versus our own internal plan," said Peter Boneparth, president and chief executive officer, during a conference call to Wall Street.
The ceo declined comment regarding the company's exploration of a possible sale, and asked that analysts refrain from posing questions about the process during the question-and-answer session.
Boneparth noted that for the wholesale better business, the "overall tone of our sell-through at retail was, without exception, exceptional. All of our power brands are performing either at or exceeding plan." He cited Jones Signature line, Jones Sport, Anne Klein and the apparel component of Nine West as the businesses that beat plan. Other categories looking "terrific for us right now" are the dress and suit businesses, which he said were also "performing at retail well above plan."
The ceo added that many of the initiatives he spoke about on past calls were finally impacting the company's business at retail and its performance with respect to its retail customers.
"I think what we're also very proud of in this quarter is we're seeing the ability to actually replenish goods at a very high rate, or certainly faster than we had previously," Boneparth said.
But company executives disclosed during the call that the quarter's results were boosted in part by a number of orders that were shifted from the current quarter into the first. The company declined to quantify how many orders were moved up into the first quarter.By segment, wholesale moderate apparel declined by 6.9 percent, or $25 million, in the first quarter, while wholesale footwear and accessories fell by 14 percent, or $39 million. One bright spot for Jones was still its retail component, where segment revenues were up 7.6 percent, or $22 million. Barneys New York gained 6.6 percent in comp sales for the quarter, according to Boneparth.
Howard Socol, ceo of Barneys, said during the call that the key performing categories were accessories, particularly handbags and jewelry; shoes, and the Co-op business. The company opened two new Co-op stores in the quarter, in the Georgetown area of Washington D.C., and Houston. A Barneys outlet store was opened in Fort Lauderdale, Fla., as well as its first flagship in Boston, which also represented the first Barneys flagship to open in 13 years. Barneys will open two more flagships in the fall, in Dallas and Las Vegas.
Alberta Ferretti's "Rainbow Week" sweaters are back. The designer closed her #MFW show with a few day-of-the-week sweaters, which first debuted on the catwalk last January as part of the pre-fall 2017 collection. #wwdfashion (📷: @delphineachard)