Ascena Retail Group (ASNA) Guides Q2 EPS Below Consensus Views

ascena retail group, Inc. (Nasdaq – ASNA) (the “Company”) today announced sales results for its holiday period, and updated its fiscal 2019 second quarter earnings per share guidance. Holiday comp sales were up 3%, as presented by segment and brand below.

Results shown for holiday period, defined as the weekend preceding Thanksgiving through New Year’s Day (11/17/18 - 1/1/19)

Quarter-to-date enterprise level comp sales are also up 3%.

David Jaffe, Chief Executive Officer commented, “We are pleased to have delivered enterprise comp sales and margin growth over the holiday period, although we continue to strive for more balanced performance across our brands. Momentum continued at LOFT and Ann Taylor, with strong product acceptance across both brands driving double digit comp sales and margin growth at our Premium segment. We are also pleased with performance at our Value segment, with continued stabilization at maurices, and positive inflection at dressbarn, which delivered high single digit comp sales and margin growth in December.”

Jaffe continued, “These positive developments were offset by performance at our Kids and Plus segments. At our Kids segment, Justice store traffic slowed as we moved through the holiday period, requiring aggressive clearance activity to address its highly seasonal specialty assortment prior to Christmas. And at our Plus segment, we have made substantive changes to the Lane Bryant apparel assortment to address fashion missteps from our prior quarter, and believe we will be better positioned as we move into Spring.”

Jaffe concluded, “While we expect comp sales will be in line with our second quarter guide, elevated clearance activity at our Plus and Kids segments have pressured gross margin rate and as a result, we now expect a loss of 23 to 28 cents per share for the quarter. We are pleased with top-line trends coming out of holiday, and remain focused on building upon this momentum as we head into the Spring season.”

(*Street sees Q2 loss per share of 19 cents)

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