On Thursday, shares of mall retailer Express Inc. (EXPR - Free Report) are tanking, down over 21% in midday trading after the company reported weak third quarter results and a cautious holiday outlook.
Express earned $11.6 million this quarter, or 11 cents per share (excluding 4 cents from non-recurring items), missing the Zacks Consensus Estimate of 12 cents per share. That is down considerably compared with $26.3 million, or 31 cents per share, reported a year earlier.
Net sales came in at $506 million, beating our estimate but decreasing 7% year-over-year. Comparable sales, including e-commerce sales, fell 8% during the quarter compared to a 6% increase in the year-ago period. However, e-commerce sales on its own increased 15% to $96.3 million.
“Our third quarter performance was highlighted by sales and earnings in line with our guidance and progress made addressing the areas noted for improvement during our second quarter call. Notably, while mall traffic challenges continued to impact our store performance, we achieved a double digit increase in e-commerce sales,” said president and CEO David Kornberg.
Looking ahead, Express expects holiday quarter earnings to fall in the range of 26 cents to 30 cents per share, with sales down by low double digits. For full-year 2016, the Ohio-based retailer forecasts earnings between 78 cents and 82 cents per share. Its prior guidance was for earnings in the range of $1.00 and $1.14 per share.
Like its mall peers American Eagle Outfitters (AEO - Free Report) and Abercrombie (ANF - Free Report) , Express’ holiday season will be very tough this year, as more customers turn to online shopping or other retail brands.
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