Chicos FAS (CHS) Reports Q1 Loss of $1.55/sh

Chicos FAS (NYSE: CHS) reported Q1 EPS of ($1.55), versus $0.02 reported last year. Revenue for the quarter came in at $280.3 million, versus $517.7 million reported last year.

Fiscal 2020 Outlook:

The Company previously withdrew its guidance issued in its fourth quarter earnings release dated February 27, 2020 and is not providing updated guidance at this time. The impact of the COVID-19 pandemic creates uncertainty in predicting near-term performance. As previously discussed, we have aggressively taken actions designed to balance our cash flows with the current environment. We expect these actions when combined with our strong financial position and competitively advantaged brands will enable us to successfully manage through the COVID-19 pandemic, allowing us to deliver sales through a variety of channels, including our stores, through social distancing sales practices such as curbside pickup, appointments and Style Connect, in addition to growing digital sales.

The Company believes it has appropriately adjusted its floor sets and receipts to align with sales expectations. Accordingly, the Company does not currently expect significant inventory write-offs over the remaining three quarters of fiscal 2020.

As a result of the Company's extensive measures to mitigate the impact of the COVID-19 pandemic, including temporarily furloughing the majority of employees, temporarily reducing a majority of non-furloughed associates' salary or hours, aligning operating costs with expected sales, and the organizational restructuring, we expect to realize expense savings of approximately $230 million, or 24%, before rent expense.

There were 9 permanent store closures and no store openings in the first quarter, and we anticipate closing approximately 50 to 60 stores permanently over the remainder of fiscal 2020. However, with the disruption we have seen from the pandemic, we intend to re-evaluate each location's future viability and modify our closure plans accordingly. Additionally, since the end of last year's first quarter, we have closed 84 stores.

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

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