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Improvement in merchandise margins, Pacific Sunwear
14
Mar '12
Pacific Sunwear of California Inc. announced that net sales from continuing operations for the fourth quarter of fiscal 2011 ended January 28, 2012, were $234.2 million versus net sales of $237.6 million for the fourth quarter of fiscal 2010 ended January 29, 2011. Total Company same-store sales were flat during the period. The Company ended fiscal 2011 with 733 stores, as compared to 852 as of the end of fiscal 2010. The Company closed 87 stores in the fourth quarter of fiscal 2011.

On a GAAP basis, the Company reported a net loss of $38.1 million, or $(0.56) per share, for the fourth quarter of fiscal 2011, compared to a net loss of $35.2 million, or $(0.53) per share, for the fourth quarter of fiscal 2010.

The net loss for the Company's fourth quarter of fiscal 2011 also included a non-cash loss of $5.0 million, or $0.08 per share, related to a derivative liability that resulted from the issuance of the Convertible Series B Preferred Stock in connection with the term loan financing the Company completed in December 2011 which was not reflected in its prior guidance.

On a non-GAAP basis, excluding store closure charges of $7.2 million and the non-cash loss on derivative liability of $5.0 million (net of tax effects), and using a normalized annual income tax rate of approximately 37%, the Company's net loss for the fourth quarter of fiscal 2011 would have been $13.1 million, or $(0.19) per share, as compared to a net loss of $20.6 million, or $(0.31) per share, for the same period a year ago.

"Our sales trends improved as we moved further into the Holiday Season resulting in flat comparable store sales for the quarter and an improvement in merchandise margins, compared to the fourth quarter last year," said Gary H. Schoenfeld, President and Chief Executive Officer. "We similarly finished the fiscal year with nearly flat same-store sales and remain focused on the key merchandising, in-store and digital initiatives that we believe are critical to successfully rebuilding the PacSun brand and our position in the marketplace."

Total net sales from continuing operations for fiscal 2011 were $833.8 million versus net sales of $837.1 million for fiscal 2010. Total Company same-store sales declined 1% during fiscal 2011.

On a GAAP basis, the Company reported a net loss of $106.4 million, or $(1.60) per share, for the 2011 fiscal year, compared to a net loss of $96.6 million, or $(1.46) per share, for the 2010 fiscal year.

On a non-GAAP basis, excluding store closure charges of $12.0 million and the non-cash loss on derivative liability of $5.0 million (net of tax effects), and using a normalized annual income tax rate of approximately 37%, the Company's net loss for fiscal 2011 would have been $51.3 million, or $(0.77) per share, as compared to a net loss of $58.3 million, or $(0.88) per share, for the same period a year ago.

The Company's guidance range for the first quarter of fiscal 2012 contemplates a non-GAAP net loss from continuing operations of between $(0.26) and $(0.34) per share.


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