bebe stores (BEBE) Misses Q3 EPS by 1c

bebe stores (NASDAQ: BEBE) reported Q3 EPS of ($0.14), $0.01 worse than the analyst estimate of ($0.13). Revenue for the quarter came in at $92.7 million versus the consensus estimate of $93.1 million.

Jim Wiggett, Chief Executive Officer said, “Our third quarter results reflect continued progress in our turnaround with the third consecutive quarter of comparable store sales growth despite significantly fewer promotions and a meaningful reduction in marketing spend. To a lesser degree, we believe that the port delays and prolonged cold weather also created pressure on our sales. Our efforts to enhance our merchandise assortment combined with a more disciplined approach to inventory management and improved product flow enabled us to achieve higher full price sell-through which in turn benefited our gross margin rate. In addition, we made advances in our outlet and international expansion efforts which contributed to our overall growth in the third quarter. Looking ahead, we are highly encouraged by the progress we have made on our strategic initiatives and see growth opportunity through increased store productivity, further development of our ecommerce strategy, the transition of our outlet stores and the expansion of our international business.”

Fourth quarter and fiscal 2015 guidance:

For the fourth quarter of fiscal 2015, the Company expects comparable store sales to increase in the low to mid-single digit positive range. Gross margin is expected to be higher than the prior year due to the increased effort in margin optimization and fewer planned promotional activities. The Company expects net loss per share to be in the low single digit range. The expected net loss per share range also reflects the continuing impact of maintaining a valuation allowance against deferred tax assets and thus a close to 0% effective tax rate.

Finished goods inventory per square foot at the end of the fourth quarter of fiscal 2015 is anticipated to increase in the mid-teens range compared to the fourth quarter of fiscal 2014. The expected increase in inventory is primarily due to a shift in floor set planning for the calendar year 2015, resulting from accelerated receipts, coupled with a cost per unit increase associated with made for outlet products.

Total capital expenditures for the year are anticipated to be approximately $18 million for new stores, remodels and information technology systems.

The Board of Directors has approved the suspension of the Company’s dividend payment in order to provide additional funding to operate the business and accelerate the pace of the turnaround. The suspension will be effective immediately; therefore there will be no dividend payment in the fourth quarter of fiscal 2015.

For the fourth quarter of fiscal year 2015, the Company plans to open three bebe stores and one outlet store, and to close up to four more bebe and outlet stores, which will result in an approximately 3% decrease in total store square footage as compared to the end of fiscal 2014

For earnings history and earnings-related data on bebe stores (BEBE) click here.

You May Also Be Interested In

• Amphenol (APH) Tops Q1 EPS by 7c, offers guidance
• Amphenol (APH) Reports Q1, Announces $2B Share Buyback
• Fortive (FTV) Tops Q1 EPS by 4c ; Offers Guidance