bebe stores, inc. announced unaudited financial results for the fiscal third quarter ended April 5, 2014.
-Third quarter comparable store sales decreased 5.7%
-Third quarter net sales were $93.5 million
-Third quarter net loss per share of $(0.31) including $(0.04) per share of impairment charges
For the third quarter of fiscal 2014:
Net sales were $93.5 million, a decrease of 17.2% from $112.9 million for the third quarter a year ago. Comparable store sales for the quarter ended April 5, 2014 decreased 5.7%. The sales decrease was due partially to one fewer retail week in January in the current fiscal year coupled with the closure of 19 unproductive stores since the prior year third fiscal quarter.
The Company’s sales results were also negatively impacted by extreme weather throughout the fiscal third quarter this year with up to 136 weather-related temporary store closures. In addition, the Company believes that the timing of Easter in late April had a greater than expected negative impact on sales in the quarter, specifically in the outlet locations. Comparable store sales and traffic in outlet stores were down in the mid-teens for the quarter.
Gross margin decreased to 27.1% compared to 29.7% in the third quarter of fiscal 2013. The decrease in gross margin was primarily due to deleveraging of sales. While we have experienced an increased level of promotions in response to the challenging retail environment, merchandising margin was 50 basis points higher than the third fiscal quarter of the prior year.
SG&A expenses were $49.7 million, or 53.1% of net sales, compared to $52.2 million, or 46.2% of net sales, for the same period in the prior year. The SG&A expenses in the third quarter of fiscal 2014 reflect $2.9 million of store impairment charges. The SG&A expenses in the prior year third quarter included $4.8 million costs related to hiring of a new CEO, store impairment charges, rebranding agency costs, as well as other transition related recruiting and severance costs.
Net loss for the third quarter of fiscal 2014 was $24.3 million, or $0.31 per share, on 79.3 million shares outstanding compared to a net loss of $49.3 million, or $0.62 per share, on 80.1 million shares outstanding for the same period of the prior year. Note that the fiscal 2014 net loss reflects the continuing impact of maintaining a valuation allowance against deferred tax assets, which was recorded in the third quarter of the prior year in the amount of $31.4 million or $0.39 per share.