Fort Myers, FL–Chico’s FAS Inc., reported Tuesday worse-than-expected third quarter evenue and earnings as the number of transaction fell, particulary during both transaction count and average price per transaction fell.
The company reported losses of $11.6 million, or 9 cents a share compared with a $26.5 million profit, or 17 cents a share, a year prior . Excluding charges related to the restructuring and the previously announced selling of its direct-to-consumer Boston Proper business, earnings fell to 13 cents a share from 19 cents the year before.
Revenue was down fell 3.7% to $641 million. Comparable store sales fell 3.3%
Analysts had expected adjusted profit of 20 cents a share on revenue of $667 million.
CEO David Dyer said that the decrease could be due to a perfect storm of conditions in September that impacted sales.
“I think it was really the perfect storm with the Labor Day shift and the volatility in the stock market,” he told analysts during a conference call morning. “I think that affected us. I think it caught not only us, but most of the industry, somewhat by surprise.”
Dyer called the first three weeks of September “terrible,” pointing to the erratic stock market and warm weather as some of the possible reasons for the slow down. Sales improved in October, but the rebound wasn’t enough to make up for the September losses.
Chico’s is another retailer that has instituted a turnaround strategy.
to cut capital spending, accelerate store closures and cut jobs. The move was made after private-equity firm Sycamore Partners dropped its bid to buy Chico’s because it couldn’t line up financing. The company said in October that Walmart Stores Inc. veteran Shelley Broader would become its chief executive at the start of December.
Chico’s namesake brand posted a 4.7% fall in sales to $220 million while revenue in the White House|Black Market segment edged down 2% to $72 million. Sales in the Soma Intimates brand fell 0.9% to $17 million.
Chico’s also announced that its Board of Directors has approved a new $300 million share repurchase authorization for the company’s common stock and canceled the remainder of its December 2013 share repurchase program, reinforcing the company’s commitment to returning excess cash to shareholders.
During fiscal 2015, the Company repurchased 14.6 million shares under accelerated stock repurchase agreements, completing all but $40 million of its existing share repurchase authorization