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NY & Co continues to view 2011 as a transition year
20 May '11
5 min read
Outlook
Regarding expectations for the second quarter of fiscal year 2011, the Company provided the following:
• Comparable store sales for the second quarter of fiscal year 2011 are expected to be approximately flat with 545 stores in operation at the end of the second quarter as compared to 581 in the prior year.
• Gross margins are expected to increase between 1,400 and 1,500 basis points from the prior year's rates reflecting substantially lower levels of markdowns partially offset by increased merchandise cost pressures.
• On an adjusted basis, excluding $15.7 million of non-cash charges recorded in the second quarter of fiscal year 2010, selling, general and administrative expenses as a percentage of net sales are expected to decrease between 100 and 150 basis points versus the prior year.
• The Company expects the effective tax rate for the second quarter of fiscal year 2011 to be approximately 0%. As previously announced, the Company continues to provide for adjustments to the deferred tax valuation allowance initially recorded in the second quarter of fiscal year 2010 offsetting any future tax provisions or benefits resulting in an approximately 0% effective tax rate for GAAP purposes.
• The Company expects inventory levels at the end of the second quarter of fiscal year 2011 to decline by a low single-digit percentage versus the prior year. On-hand inventory, which excludes inventory in-transit, is expected to be up slightly on an average store basis.
• Capital expenditures are expected to be approximately $7.0 million for the second quarter of fiscal year 2011, as compared to $5.4 million in the prior year. Depreciation expense for the period is estimated at $9.0 million.
• 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 of fiscal year 2011.
• The Company expects to close eight stores and remodel six existing locations, ending the second quarter of fiscal year 2011 with 545 stores, including 24 outlet stores.
New York & Company Inc is a leading specialty retailer of women's fashion apparel and accessories offering the latest NY Style.
Regarding expectations for the second quarter of fiscal year 2011, the Company provided the following:
• Comparable store sales for the second quarter of fiscal year 2011 are expected to be approximately flat with 545 stores in operation at the end of the second quarter as compared to 581 in the prior year.
• Gross margins are expected to increase between 1,400 and 1,500 basis points from the prior year's rates reflecting substantially lower levels of markdowns partially offset by increased merchandise cost pressures.
• On an adjusted basis, excluding $15.7 million of non-cash charges recorded in the second quarter of fiscal year 2010, selling, general and administrative expenses as a percentage of net sales are expected to decrease between 100 and 150 basis points versus the prior year.
• The Company expects the effective tax rate for the second quarter of fiscal year 2011 to be approximately 0%. As previously announced, the Company continues to provide for adjustments to the deferred tax valuation allowance initially recorded in the second quarter of fiscal year 2010 offsetting any future tax provisions or benefits resulting in an approximately 0% effective tax rate for GAAP purposes.
• The Company expects inventory levels at the end of the second quarter of fiscal year 2011 to decline by a low single-digit percentage versus the prior year. On-hand inventory, which excludes inventory in-transit, is expected to be up slightly on an average store basis.
• Capital expenditures are expected to be approximately $7.0 million for the second quarter of fiscal year 2011, as compared to $5.4 million in the prior year. Depreciation expense for the period is estimated at $9.0 million.
• 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 of fiscal year 2011.
• The Company expects to close eight stores and remodel six existing locations, ending the second quarter of fiscal year 2011 with 545 stores, including 24 outlet stores.
New York & Company Inc is a leading specialty retailer of women's fashion apparel and accessories offering the latest NY Style.
New York & Company Inc
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