CHRS delivers first positive comp result in 15 quarters
08 Sep '10
2 min read
Charming Shoppes, Inc., a leading multi-brand apparel retailer specializing in women's plus-size apparel, reported sales and operating results for the three and six month periods ended July 31, 2010.
Commenting on the results for the quarter, Jim Fogarty, President and Chief Executive Officer of Charming Shoppes, Inc. said, "With our strong balance sheet and liquidity, Charming Shoppes is an operating turnaround, and my team and I are focused on the success of that turnaround. While we were very disappointed by our EBITDA performance in the quarter, we delivered our first positive comp result in 15 quarters, and stabilized both our top line and our customer base.
“Our customer base had declined significantly during 2009, and in order to stem the decline, we went on 'offense' with our assortments, we were more promotional, and we invested in additional marketing. Our year-round and seasonal core assortments generally performed well.
“However, our teams struggled with seasonal non-core merchandise, including novelty and fashion tops and bottoms, and we ultimately were over-receipted in the depth of those choices. In addition, EBITDA was further impacted by heavier discounting than expected to effectively clear seasonal merchandise in an already promotional environment.
"We are addressing our second quarter merchandising issues and are continuing to generally improve our assortments - focusing on the right products in the right quantities. In the second half of 2010, we are relaunching our Right Fit denim and career pants with a strong offering of petite and tall lengths at Lane Bryant and Fashion Bug. We are also presenting a broader footwear assortment in 500 Lane Bryant stores, and have relaunched our Juniors assortment in 300 Fashion Bug stores.
"We remain focused on our key priorities: (1) Focus on the Customer; (2) Stabilize and Begin to Grow Profitable Revenue; (3) Increase EBITDA; (4) Increase Cash Flow; and (5) Talent. While adjusted EBITDA was disappointing, we made progress focusing on our customer and stabilizing our revenue base. We ended the quarter with cash in excess of debt of $42 million, versus debt in excess of cash of $33 million at the end of 2009, an improvement of $75 million. Finally, we made a number of important executive changes during the quarter, including the appointments of a new President at Fashion Bug, a new President at Outlets, and a new Executive Vice President, Merchandising and Product Development, at Fashion Bug."
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