Charming Shoppes Inc.’s fourth-quarter losses narrowed, but the company missed expectations as its business was weighed down by higher production costs and price pressures at retail.
Net losses narrowed to $13.2 million, or 11 cents a share, from $30.4 million, or 26 cents, a year earlier. Adjusted losses, which factor out restructuring charges, totaled 6 cents a share and were 4 cents worse than the 2 cents analysts expected.
Sales for the three months ended Jan. 28 slipped 2.9 percent to $559.1 million from $575.8 million. Comparable-store sales rose 1 percent.
“Our fourth quarter results … were below our expectations as the impact of higher product costs and a challenging promotional environment created gross profit pressures, specifically at Lane Bryant,” said Anthony Romano, president and chief executive officer. “In response, we went on the offensive and chose to offer deeper-than-planned discounts to ensure seasonal unit sell-throughs.”
The company, which operates 1,857 stores under the Lane Bryant, Cacique, Fashion Bug and Catherine Plus Sizes brands, is shifting its merchandising strategy, focusing on seasonal, faster-turning novelty looks rather than carrying fashion basics year-round.
For the full year, Charming Shoppes’ losses narrowed to $2 million from $54 million in the prior year. Sales fell 3.4 percent to $2 billion.
This year, Charming Shoppes expects to close between 90 and 105 stores, while opening 20 new stores and relocating 25.