Pacific Sunwear Q1'FY14 comparable store sales up 3%

30 May '14

4 min read

Pacific Sunwear of California, Inc., announced that net sales from continuing operations for the first quarter of fiscal 2014 ended May 3, 2014, were $171.1 million versus net sales from continuing operations of $166.4 million for the first quarter of fiscal 2013 ended May 4, 2013. Comparable store sales for the first quarter of fiscal 2014 increased 3%. The Company ended the first quarter of fiscal 2014 with 618 stores versus 638 stores a year ago.

On a GAAP basis, the Company reported a loss from continuing operations of $10.4 million, or $(0.15) per diluted share, for the first quarter of fiscal 2014, compared to a loss from continuing operations of $24.1 million, or $(0.35) per diluted share, for the first quarter of fiscal 2013.

The loss from continuing operations for the Company's first quarter of fiscal 2014 included a non-cash gain of $1.2 million, or $0.02 per diluted share, compared to a non-cash loss of $9.3 million, or $(0.13) per diluted share, for the first quarter of fiscal 2013 related to the derivative liability that resulted from the issuance of the Convertible Series B Preferred Stock (the "Series B Preferred") in connection with the term loan financing the Company completed in December 2011.

On a non-GAAP basis, excluding the non-cash gain (loss) on the derivative liability, and assuming a tax benefit of approximately $3.8 million, the Company would have incurred a loss from continuing operations for the first quarter of fiscal 2014 of $7.4 million, or $(0.11) per diluted share, as compared to a loss from continuing operations of $9.5 million, or $(0.14) per diluted share, for the same period a year ago.

"I believe that in a tough marketplace we are continuing to attract new customers and great brands to PacSun, which has been key to achieving our ninth straight quarter of positive comparable store sales," said Gary H. Schoenfeld, President and Chief Executive Officer. "While we anticipate continued growth in our Men's business, the promotional environment that we are seeing in the mall coupled with underperformance in a couple of categories in Women's is resulting in a more cautious outlook for the second quarter."

Financial Outlook for Second Fiscal Quarter of 2014

The Company's guidance range for the second quarter of fiscal 2014 contemplates a non-GAAP loss per diluted share from continuing operations of between $(0.08) and $(0.02), compared to $0.02 in the second quarter of fiscal 2013.

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