Anaheim, CA–Shares of Pacific Sunwear of California Inc. were down 8.7% in midday trading today after the teen retailer said it anticipates a third quarter loss between 4 cents and 9 cents a share, and revenue between $203 million and $208 million. Analysts were expecting a loss of 2 cents a share on revenue of $207.1 million.
This is a further drop from after-hours trading Thursday night, when results were announced.
Growth in Men’s
Pacsun’s net income was $7.5 million, or 10 cents a share, up from $19.24 million in losses during the same period last year.
The second quarter earnings include non-cash gain of $10.4 million, or 14 cents a share. PacSun said it would have posted a loss of $1.8 million, or 3 cents a share, if the non-cash gain is excluded along with a $1.6 million in tax benefits.
Net revenue was up 0.8% to $211.7 million, slightly up from $210.1 million it posted for the second quarter of 2013. Analysts expected losses of 3 cents per share and revenue of $208.5 million for the quarter.
Comparable store sales edged up 0.3%.
The company opened two stores and closed another two during the reporting period, bringing the chain’s total to 618.
“As previously indicated, sales trends improved as the quarter progressed led by continued growth in our men’s business,” said CEO Gary Schoenfeld. “For Q3, even in the face of a down-trending denim cycle we are encouraged by the positive response to the balance of our initial fall assortments. We continue to believe that our core strategies are attracting new customers and differentiating PacSun in this very competitive market.”
For the full year, the company is forecasting a loss per share from continuing operations of between 4 to 9 cents, compared with 5 cents in the third quarter. Comparable store sales are expected to be flat to up 3% and revenue from $203 million to $208 million.