Chicos FAS (CHS) Tops Q4 EPS by 3c, Offers Guidance

Chicos FAS (NYSE: CHS) reported Q4 EPS of ($0.03), $0.03 better than the analyst estimate of ($0.06). Revenue for the quarter came in at $527.1 million versus the consensus estimate of $524.68 million.

• Chico's FAS delivers 2.2% comparable sales growth with all brands reporting positive

For the fiscal 2020 first quarter, compared to the fiscal 2019 first quarter:

• The Company anticipates a low single-digit increase in total net sales and consolidated comparable sales, reflecting continued progress and momentum in the business.
• The Company expects gross margin as a percent of net sales to increase approximately 20 to 40 basis points, due primarily to strategic reductions in promotional depth as well as leverage of fixed costs on higher sales.
• SG&A expenses are expected to be approximately flat, reflecting ongoing cost management, offset by investments in marketing and a return to target incentive compensation levels.

For full year fiscal 2020, compared to the full year fiscal 2019:

• The Company anticipates a low single-digit increase in total net sales and consolidated comparable sales.
• The Company expects gross margin as a percent of net sales to increase approximately 50 to 100 basis points, due primarily to strategic reductions in promotional depth as well as leverage of fixed costs on higher sales.
• SG&A expenses are expected to increase approximately $10 million, reflecting investments in marketing and a return to target incentive compensation levels, partially offset by ongoing cost management.
• The Company estimates a fiscal 2020 tax expense in the range of $3 to $5 million.
• Capital and cloud-based expenditures are expected to be approximately $45 to $50 million, primarily driven by technology enhancements and targeted reinvestments in stores.

For earnings history and earnings-related data on Chicos FAS (CHS) click here.

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