Home / Knowledge / News / Apparel/Garments / Wet Seal business becomes more challenging
Wet Seal business becomes more challenging
23
Nov '11
The Wet Seal Inc., a leading specialty retailer to young women, announced results for its fiscal third quarter ended October 29, 2011, and introduced guidance for the fourth quarter of fiscal 2011.

For the third quarter:
• Net sales were $152.1 million compared to net sales of $146.4 million for the prior year third quarter.
• Consolidated comparable store sales declined 0.9%. Comparable store sales for Wet Seal declined 0.1% and for Arden B declined 6.3%.
• Operating income was $6.1 million, or 4.0% of net sales, compared to $5.1 million, or 3.5% of net sales, in the prior year third quarter.
• The current year quarter included a $1.3 million reversal of accrued incentive compensation expense, which reflects reduced expectations for achievement of incentive targets for the fiscal year.
• The current year quarter included $0.7 million in non-cash asset impairment charges and the prior year quarter included $1.6 million in non-cash asset impairment charges. Excluding the impact of these non-cash charges, operating income would have been $6.8 million, or 4.5% of net sales, in the current year quarter, compared to $6.7 million, or 4.5% of net sales, in the prior year quarter.
• The prior year quarter included a $0.5 million non-cash income tax charge due to a decrease in deferred tax assets related to a tax method change elected upon filing the 2009 federal tax return.
• Net income was $3.7 million, or $0.04 per diluted share, as compared to $2.6 million, or $0.03 per diluted share, in the prior year quarter. Excluding the after-tax effect of the non-cash asset impairment charges, net income in the current year quarter would have been $4.1 million, or $0.05 per diluted share. Excluding the after-tax effect of the non-cash asset impairment charges and the non-cash charge to decrease deferred tax assets, net income in the prior year quarter would have been $4.0 million, or $0.04 per diluted share.
• As of quarter-end, the Company's inventory per square foot was up 2% versus the prior year quarter, with Wet Seal up 2% and Arden B up 1%.
• The Company generated cash flows from operations of $3.4 million during the third quarter, and ended the quarter with $131.3 million of cash, cash equivalents and short-term investments, and no debt.

Ms. Susan McGalla, chief executive officer of The Wet Seal, Inc., commented, “Building on positive momentum from the first half of the year, our Wet Seal business continued to be strong during the high traffic back-to-school shopping period through August and into early September. As we transitioned to fall, Wet Seal business became more challenging, as our sportswear and outerwear assortments for the season did not perform to our expectations.

“At Wet Seal this year, we also eliminated Halloween costumes and related merchandise, a historically low margin business for us, in order to maintain a brand-right fashion assortment in our stores. This was the right strategic decision for our long-term direction, but also challenged sales results in October.”

Must ReadView All

Textiles | On 10th Dec 2016

India’s 2016-17 cotton import to touch 17 lakh bales

The import of cotton from international markets by spinning mills in...

Textiles | On 10th Dec 2016

US textile & apparel imports fall 6.50% in Jan-Oct ’16

The import of textiles and apparel by United States dropped 6.50 per...

Textiles | On 10th Dec 2016

Indian textile hubs adopt cashless payment modes

The textile ministry is promoting cashless payment within the...

Interviews View All

Pinkesh Jain
Everflow Petrofils Ltd

‘An innovative technology which India needs desperately is the...

Amardeep Singh
Orient Craft

'In export markets, the trend in terms of embroidery, is towards matte...

Smita Murarka
Amanté

‘There is huge demand in the Indian lingerie market for non-wired styles.’

Silke Brand-Kirsch
Schlegel und Partner

Silke Brand-Kirsch, executive partner of Schlegel und Partner, a leading...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Eric Scholler
Groz-Beckert

The Indian market has huge potential in technical textiles, and by far,...

Ritu Kumar
Label Ritu Kumar

‘Classics will return’ "There are a lot of people wearing western clothes ...

Yash P. Kotak
Bombay Hemp Company

One of the directors of Bombay Hemp Company, Yash P. Kotak, speaks to...

Mike Hoffman
Gildan Activewear SRL

Gildan Activewear, a manufacturer and marketer of branded clothing and...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
December 2016

December 2016

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


Advanced Search