Express Inc. posted lower fourth-quarter profits from a year ago, but results were still better than Wall Street had expected.
This story first appeared in the March 12, 2015 issue of WWD. Subscribe Today.
For the quarter ended Jan. 31, net income fell 12.7 percent to $41.8 million, or 49 cents a diluted share, from $47.9 million, or 57 cents, a year ago. Net sales were up 1.4 percent to $725.8 million from $715.9 million. Comparable-store sales fell 2 percent on the heels of a 1 percent increase a year ago. The company said e-commerce sales rose 4 percent to $144.3 million. Wall Street analysts were expecting on average 46 cents on net sales of $712.9 million.
For the year, net income dropped 41.4 percent to $68.3 million, or 81 cents a diluted share, from $116.5 million, or $1.37 a share, in 2013. Net sales slipped 2.3 percent to $2.17 billion from $2.22 billion.
David Kornberg, president and chief executive officer, said in a conference call to analysts that “business strengthened as customers came back and forth, and responded well to our early spring deliveries. This has continued into the first quarter of the new year and is reflected in our guidance.”
He also said that the company this year did not anniversary two promotional events — the five-day, all-store, 40 percent-off promotion and the four-day e-mail event. Those decisions helped “preserve and protect the value of our newest and best-selling items, and the overall inventory level of our spring goods,” the ceo said. He also said that while promotions have been a part of Express’ DNA, and will continue to be, the promotions will be “used more sparingly going forward.”
For 2015, some key efforts will be increasing profitability, elevating the customer experience and investing in systems to better support its customer-centric focus. Kornberg said the company intends to protect its “leading position in wear-to-work and dressy, and to elevate our position as a destination for denim and casual wear.”
The company has introduced Express One Eleven in select stores, a collection of casual women’s knit tops, and Swim online this week.
For the first quarter of 2015, the company said it expects comps in the low- to midsingle digits, compared with a comp decline of 11 percent in the year-ago first quarter. The company guided first-quarter diluted earnings per share to between 4 cents and 7 cents, with net income forecasted in the $3 million to $6 million range.
The chain operates 640 stores.
Shares of Express Inc. rose 3.48 percent to $15.47 in Big Board trading.