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Express Q2 net sales down 5 percent

By Prachi Singh

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Management

Express second quarter net sales decreased 5 percent to 478.5 million dollars from 504.8 million dollars in the second quarter of 2016. Comparable sales including e-commerce sales decreased 4 percent, compared to an 8 percent decrease in the same quarter last year, while ecommerce sales increased 28 percent to 90 million dollars.

Commenting on the results, David Kornberg, the company’s President and CEO said in a media release: “Comparable sales and earnings were at the top end of our guidance, as our key initiatives gained further traction. Our e-commerce performance was outstanding, increasing 28 percent over last year, and store comps showed further sequential improvement.”

Second quarter operating results

The company’s merchandise margin for the quarter declined by 120 basis points, driven by the highly promotional environment and the impact of exiting Canada. This the company said, resulted in a 240 basis point decline in gross margin, representing 27.5 percent of net sales compared to 29.9 percent in last year’s second quarter.

The company’s operating loss was 15.9 million dollars and includes a negative 17.6 million dollars impact related to the exit of Canada, consisting of 16.3 million dollars in restructuring costs and 1.3 million dollars related to an inventory adjustment. This compares to operating income of 17.9 million dollars in the second quarter of 2016.

Net loss for the quarter was 11.8 million dollars or 0.15 dollar per diluted share, and includes a net negative 0.16 dollars per diluted share impact related to the exit of Canada. Adjusted earnings per share were 0.01 dollars. This, Express said, compares to net income of 10.1 million dollars, or 0.13 dollar per diluted share, in the second quarter of 2016.

For the third quarter, the company expects comparable sales to remain negative low single digits, net income to range between 5 to 8 million dollars against 11.6 million dollars same quarter last year, and diluted earnings per share between 0.06 dollar to 0.10 dollar compared to 0.15 dollar last year.

Picture:Express website

Express