Ann Taylor Stores Corporation said that as a result of stronger than expected first quarter sales and a higher gross margin rate, it expects bottom-line performance for the fiscal first quarter of 2010 to significantly exceed expectations and to be substantially better than the first quarter of 2009.
Based on preliminary results, the Company provided the following update to the outlook it reported on March 12, 2010:
• Total Company net sales for the fiscal first quarter of 2010 are expected to be approximately $475 million, as compared to the Company's prior outlook for sales of approximately $445 million.
• Comparable store sales for the first quarter of 2010 are expected to increase by approximately 11%. By division, comparable store sales at Ann Taylor are expected to increase by approximately 15% and, at LOFT, comparable store sales are expected to increase by approximately 9%. In addition, first quarter e-commerce sales at both brands are expected to increase by more than 50% compared to last year.
• Gross margin rate is expected to approach 59%, compared to the Company's previous outlook which anticipated a gross margin rate of approximately 56.5%.
• Selling, general and administrative expenses are expected to be approximately $245 million for the quarter.
• The effective tax rate for the first quarter is anticipated to be approximately 41%.
Kay Krill, President and Chief Executive Officer, said, "We are very pleased with the performance at both Ann Taylor and LOFT. The positive sales momentum we achieved early in the quarter continued throughout the period, with clients responding favorably to our product offering at both brands as well as our increased marketing initiatives, which delivered meaningful traffic improvements in-store and online. In addition, our gross margin rate benefited from strong full-price sales, our successful planned promotional strategy and our ongoing focus on carefully managing inventories. Overall, the Company's first quarter performance reflects the progress we've made towards delivering topline growth and enhanced productivity across all brands and channels."
Ann Taylor Stores Corporation
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