Express (EXPR) Tops Q1 EPS by 5c, Updates Guidance

Express (NYSE: EXPR) reported Q1 EPS of ($0.10), $0.05 better than the analyst estimate of ($0.15). Revenue for the quarter came in at $450.8 million versus the consensus estimate of $435.74 million.

GUIDANCE:

Express sees FY2022 EPS of $0.14-$0.20, versus the consensus of $0.17.

2022 Outlook

• This outlook is based on our strong year-to-date performance and the strength of our product, brand, customer and execution advancements, balanced against the ongoing supply chain challenges, macroeconomic pressures, geopolitical events and other uncertainties that may impact our business.

Second Quarter 2022

• The Company expects the following for the second quarter of 2022 compared to the second quarter of 2021:
• Comparable sales to increase mid-single digits
• Gross margin rate to increase approximately 100 basis points
• SG&A expenses as a percent of sales to delever approximately 100 basis points, including incremental investments in technology, higher labor expenses and general inflationary pressures
• Net interest expense of $4 million
• Effective tax rate of 4%. Adjusted effective tax rate of approximately 45% after adjusting for the impact of changes in the valuation allowance recorded against deferred tax assets

Full Year 2022

• The Company expects the following for the full year 2022 compared to the full year 2021:
• Comparable sales to increase 8% - 10%
• Gross margin rate to increase at least 100 basis points
• SG&A expenses as a percent of sales to be approximately flat
• Net interest expense of $14 million
• Effective tax rate of 4%. Adjusted effective tax rate of approximately 45% after adjusting for the impact of changes in the valuation allowance recorded against deferred tax assets
• Diluted earnings per share of $0.24 to $0.34. Adjusted diluted earnings per share of $0.14 to $0.20 after adjusting for the impact of changes in the valuation allowance recorded against deferred tax assets
• Capital expenditures of $50 - $55 million
• Inventory elevated in the second quarter and closer to parity with sales growth in the back half of the year

For earnings history and earnings-related data on Express (EXPR) click here.

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