For the quarter ended April 5, the women’s specialty retailer said total revenue fell about 17% to $93 million compared with $113 million the year before. That was below the $104.3 million that analysts’ average expected.
Later Easter Didn’t Help
Comparable store sales were down 5.7% worse than bebe’s own estimate for flat comps.
The decline was attributed to one less selling week this year and the closure of 19 unproductive stores. Also 136 stores had to close temporarily due to extreme winter weather. The company also said that Easter falling in late April had a bigger negative impact on its sales for the quarter.
Moreover, merchandise margins actually increased by 50 basis points compared to a year ago but were below previous expectations “due to the increased level of promotions in response to the challenging retail environment.”
“More recently, we have seen continued progress in our sales and margins, with improved performance in all channels during the past Easter week as consumers responded positively to our April product offerings,” said CEO Steve Birkhold. “We remain focused on executing our six strategic initiatives to move our business forward and anticipate continued improvement in comparable store sales and margin performance.”
As a result, bebe is anticipating a loss of 29 to 32 cents a share for the third quarter, including impairment charges of up to 4 cents a share. Analysts forecast a loss of 17 cents a share.