Ascena Retail Group Inc. blamed soft third-quarter sales on the economy and the weather and fell short of Wall Street’s profit expectations, pushing its stock down 9.6 percent to $17.95 in afterhours trading today.
Ascena’s earnings fell 36.8 percent to $31.2 million, or 19 cents a diluted share, from $49.4 million, or 31 cents, a year earlier. Adjusted profits of 26 cents a share came in 4 cents below the 30 cents Wall Street expected.
Sales for the quarter ended April 27 jumped 45.8 percent to $1.14 billion from $783.3 million, with the June 2012 acquisition of the Charming Shoppes boosting results.
Sales came in $30 million below what analysts projected for the quarter and the Justice, Lane Bryant, Maurices and Dress Barn businesses all posted negative comparable-store sales. The Catherines business comped up 8 percent.
David Jaffe, president and chief executive officer, said: “Our soft third-quarter top line performance reflects lower-than-expected traffic driven by continued economic challenges for our customers and unseasonably cold weather as well as merchandising misses at Lane Bryant and Dress Barn. Sales trends improved somewhat across all brands in [fiscal fourth quarter] to date compared to [the third quarter], and we are adjusting our promotional plans to ensure that spring inventory balances are at appropriate levels by the end of our fiscal 2013 fourth quarter.”