Express posts 11 percent decline in Q4 net sales

Express net sales decreased 11 percent in the fourth quarter to 678.8 million dollars, while comparable sales including e-commerce sales decreased 13 percent, compared to a 4 percent increase in the fourth quarter of 2015. Express said, full year net sales decreased 7 percent to 2.2 billion dollars, while e-commerce sales increase 5 percent, accounting for 19 percent of net sales.

Commenting on the results, David Kornberg, the company's President and CEO said in a media release, "Despite ongoing pressures in the retail sector, our fourth quarter earnings were in line with previously issued guidance. As expected, our store performance continued to be impacted by challenging mall traffic and a promotional retail environment. We enter 2017 with confidence that the actions we have taken and the initiatives underway will translate into stronger performance as we move through the year."

Fourth quarter financial highlights

E-commerce sales in the fourth quarter increased 9 percent to 170.1 million dollars. Merchandise margin declined by 330 basis points driven by increased promotional activity. Operating income was 38.8 million dollars or 5.7 percent of net sales, compared to 92.9 million dollars or 12.1 percent of net sales in the fourth quarter of 2015.

Net income was 22.8 million dollars or 0.29 dollar per diluted share compared to 56.1 million dollars or 0.67 dollar per diluted share, in the fourth quarter of 2015. Full year diluted earnings per share stood at 0.81 dollar.

Reveals first quarter and FY17 outlook

For the first quarter of 2017, the company expects to report comparable sales growth in negative high single digits and net income of 3 million dollars compared to 12.9 million dollars, same quarter, last year. For the full year, comparable sales are expected to be flat to grow at low single digits and net income of 52 to 58 million dollars against 57 million dollars last year. Diluted EPS is expected to range between 0.65 to 0.73 dollar against 0.73 dollar reported last year.

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