NEW YORK — Shares of Vince Holding Corp. dropped 9 percent in early after-hours trading following the company’s lowering of guidance for the full fiscal year after it reported first-quarter results.
For the three months ended May 2, net income jumped 77.3 percent to $2.5 million, or 6 cents a diluted share, from $1.4 million, or 4 cents, a year ago. Net sales rose 12 percent to $59.8 million from $53.5 million. The company said wholesale sales increased 2.6 percent to $38.3 million, while the direct-to-consumer channel jumped 33.6 percent to $21.6 million. Comparable-store sales, which include e-commerce sales, gained 9.7 percent.
Wall Street analysts were expecting on average EPS of 5 cents on revenues of $59.5 million.
Jill Granoff, chief executive officer, said that results were driven by the increase in the direct-to-consumer segment, a “modest increase in our wholesale segment sales and gross margin expansion of 200 basis points.”
Shares of Vince had closed down 4 percent to $15.28 in Big Board trading before first-quarter results were posted, and then slipped further to $13.91 following the earnings report.
Granoff said that although the company posted a solid first-quarter earnings report, the company was still lowering guidance for the full fiscal year “based on current business trends and other macro dynamics.”
The ceo further explained that the company is still projecting double-digit sales growth in retail, e-commerce, international and licensing channels, but lowered guidance because it is now expecting a low double-digit decline in its domestic wholesale channel compared with a year ago. The decrease is due to “reduced off-price shipments and a reduction in our anticipated full-price reorder rate,” she said.
Currently, the company expects diluted EPS of 85 cents to 90 cents on total net sales of $340 million to $350 million.