The Wet Seal, Inc, a leading specialty retailer to young women, reported sales results for the 13-week and 52-week periods ended February 1, 2014 compared to the 14-week and 53-week periods ended February 2, 2013. Comparable store sales figures for the fourth quarter and full year of fiscal 2013 are versus the comparable 13-week and 52-week periods from last year, respectively.
John D. Goodman, Chief Executive Officer, stated, “We had a difficult fourth quarter, marked by ongoing softness in mall traffic, a highly promotional environment throughout the teen sector and elements of our assortments that did not resonate as well as we anticipated with our customers. This led to a greater than expected decline in comp store sales and pressured our merchandise margins.
During this challenging period, we remain focused on the critical disciplines of expense control and inventory management. At fiscal year-end, inventory dollars per square foot were down approximately 9% versus the prior year at Wet Seal and down approximately 6% versus the prior year at Arden B.”
Mr. Goodman continued, “While we did not meet our expectations for the fourth quarter, we are encouraged by progress made during the course of fiscal 2013 under our turnaround plan, which enabled us to narrow our comparable store sales decline to 4.1% and improve year-over-year merchandise margins by more than 150 basis points.”
Versus the comparable 13-week period from last year, fourth quarter e-commerce sales declined approximately 20%, comprised of an approximate 13% decline at Wet Seal and an approximate 43% decline at Arden B. Versus the comparable 52-week period from last year, fiscal 2013 e-commerce sales declined approximately 10%, comprised of an approximate 8% decline at Wet Seal and an approximate 20% decline at Arden B.
Following the successful launch of its new e-commerce platform in late October, the Company experienced some transition issues during the fourth quarter, many of which have been addressed.
The new platform enables customers to execute transactions more efficiently from any device, providing opportunity for improved conversion rates and prospective e-commerce sales growth.
The Company ended fiscal 2013 with approximately $46 million in cash and no debt. Management will discuss the Company’s fiscal 2014 operating strategies, capital spending plans and long-term growth initiatives on its fourth quarter earnings call, which is scheduled for March 20, 2014.
Goodman concluded, “We believe there is opportunity to drive improvement in our sales and margin trends in the spring season, which is traditionally one of our strongest periods of the year. We are entering the season with clean inventories, which should help us strike a balance between margin strength and the need to maintain compelling promotions. Additionally, we are executing against our marketing, mobile and social media strategies, which are designed to drive customer engagement and differentiate Wet Seal.”