NEW YORK — A tepid start to the back-to-school season pulled down Pacific Sunwear of California Inc.'s second-quarter earnings by 54 percent.
For the three months ended July 29, income fell to $9.7 million, or 14 cents a share, from $21.1 million, or 28 cents, last year. Earnings per share include 2 cents related to stock compensation and preopening rent expenses. Sales inched up 1.5 percent to $313.7 million from $309.1 million. Continuing the year's trend of negative comps, same-store sales decreased by 5.5 percent, with sales down in the boys' and girls' divisions of the D.e.m.o. chain.
For the six months, income was $21.6 million, or 30 cents a share, compared with $38.7 million, or 51 cents, in the same period a year ago. Sales gained 4.2 percent to $613.6 million from $589 million.
"Although it is still early…back-to-school business got off to a slow start," Seth Johnson, chief executive officer of the mall-based teen specialty retailer, said in a statement. "At this point it is difficult to determine weather the slowdown reflects weakness in our back-to-school assortment, lack of trend in surf and skate, broader economic factors in teen retail overall or a combination of these factors."
Company officials said during a conference call with Wall Street that they expect to reposition Pacific Sunwear in the market by expanding the business through new concepts such as 1,000 Steps.
The company expects third-quarter earnings in the range of 22 to 30 cents per diluted share.
Pacific Sunwear said it repurchased a total of 3.2 million shares of its common stock at approximately $19 per share. The buyback is part of a $100 million share repurchase program. At the end of the second quarter, $50.5 million remained available for future repurchases.
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