- Prachi Singh |
For its first quarter ended November 3, 2018, Ascena Retail Group, Inc. reported GAAP earnings of 3 cents per diluted share, flat compared to the year-ago period, as the company said, an increase in comparable sales and lower restructuring costs were offset by the impact of a lower gross margin rate, unfavourable timing related to the adoption of the new revenue recognition accounting standard, and the unfavourable impact of the 53rd week in the company's prior fiscal year. The company’s adjusted earnings were 6 cents per diluted share compared to 11 cents per diluted share in the year-ago period, with the decline primarily caused by the unfavourable impact of the 53rd week and the new revenue recognition standard.
Commenting on the company’s first quarter, David Jaffe, Chairman and Chief Executive Officer of Ascena Retail Group, said in a statement: “We delivered a 3 percent comparable sales increase, driven by strength at our premium and kids segments. Adjusted earnings per share of 6 cents came in at the top of our guide, driven by better than expected top-line growth.”
Overview of Ascena’s first quarter results
Net sales for the first quarter were 1,592 million dollars compared to 1,590 million dollars in the year-ago period, with a 3 percent increase in comparable sales. The company said, decrease in non-comparable sales was caused by the unfavourable impact of the 53rd week in the company's prior fiscal year and fewer stores as a result of the company's ongoing fleet optimization program.
Gross margin decreased to 946 million dollars or 59.4 percent of sales compared to 965 million dollars or 60.7 percent of sales in the year-ago period. The company reported net income of 6 million dollars or 3 cents per diluted share compared to 7 million dollars or 3 cents per diluted share, in the year-ago period.
The company currently expects second quarter non-GAAP loss per share of 25 cents to 15 cents, supported by net sales of 1.675 to 1.705 billion dollars; comparable sales rise of 2 percent to 4 percent; gross margin rate of 54.2 percent to 54.8 percent. The company continues to expect fiscal 2019 full year non-GAAP earnings per share of 0 to 10 cents, supported by low single digit comp growth.
Picture:Ascena Retail website