New York & Co accessories biz improves during first quarter
21 May '09
5 min read
Outlook The Company believes that the economic environment will remain challenging and continues to plan conservatively for fiscal year 2009. As a result, the Company will limit its future outlook to one quarter and as such will provide earnings guidance for the second quarter of fiscal year 2009, along with guidance on certain key financial metrics. - Based on the softness in sales experienced during the Mother's Day selling period, the Company has tempered its expectations for the second quarter, and now expects the comparable store sales trend for the second quarter to be similar to the trend experienced in the first quarter. - Gross margins are expected to be similar to the first quarter of fiscal year 2009, but are expected to decline compared to the second quarter last year as consumers continue to be price sensitive and hold back spending while looking for value. - Selling, general and administrative expenses per average store will continue to decrease as compared to last year, reflecting the success of the Company's restructuring program which remains on track. - The Company currently expects a loss per diluted share in the second quarter of fiscal year 2009 similar to the loss incurred during the first quarter. This compares to actual second quarter of fiscal year 2008 earnings per diluted share of $0.14. - Inventory will continue to be managed tightly with goods available for sale per average store down in the high single-digits on a percentage basis versus the prior year. In-store inventory is expected to be down 10% to 15% per average store at the end of the second quarter. - Cash-on-hand at the end of the second quarter is expected to be approximately $50 million and is expected to increase during the second half of the year. - The Company has no outstanding borrowings under its revolving credit facility and does not anticipate the need to use the facility during the second quarter. - During fiscal year 2009, the Company plans to open approximately three new stores, remodel four existing locations, and close 10 to 15 stores, ending the year with 577 to 582 stores. Capital expenditures are expected to be $15 million for the full fiscal year versus $45 million in fiscal year 2008. Depreciation expense is estimated at $42 million.
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