The Wet Seal Inc. posted a first-quarter net loss, impacted by asset impairment charges and Arden B. exit costs.
For the three months ended May 3, the net loss was $21.8 million, or 26 cents a diluted share, from net income of $3.1 million, or 3 cents, a year ago. Excluding the asset impairment charges in both quarters and the Arden B. exit costs in the current quarter, the net loss was $15.1 million, or 18 cents a diluted share, from net income of $1.3 million, or 1 cent, a year ago. Net sales for the quarter were down 16.9 percent to $116.7 million from $140.4 million. Consolidated comparable store sales fell 16.9 percent, including a 16.5 percent decline at Wet Seal.
John D. Goodman, chief executive officer, said that first-quarter results were in line with expectations, and primarily reflected the macro factors that pressured retail in general. He added that throughout the period, “[W]e saw increasing strength in our Wet Seal e-commerce business, which posted a first-quarter gain of more than 8 percent versus a 9 percent increase last year.”
For the second quarter, the company expects a loss per diluted share of between 9 cents and 12 cents, before non-cash asset impairments and Arden B. exit costs. Guidance was also premised on a comps decline, including e-commerce, of between 8 percent and 11 percent.