New York & Company performs well in Q2

18 Aug '08

5 min read

• The opening of 10 new stores during the quarter, expanding the store base to 596 stores and 3.4 million selling square feet; and
• Further strengthening of the balance sheet which resulted in a cash balance of $87 million versus $27 million at the end of last year's second quarter.

Outlook:
The Company expects to continue its successful strategy of improving margin through targeted well-planned promotions and tight inventory control during what we anticipate to be a challenging business environment throughout the third and fourth quarters. The Company's outlook for the third quarter of fiscal year 2008 reflects comparable store sales in the low to mid negative single-digit range with gross margins improving versus the same period a year ago.

This outlook includes the effect of a shift in the timing of a key promotional program from the last week of the third quarter into early November in order to optimize sales and margins for the fall season. The Company's current outlook for earnings per diluted share in the third quarter of fiscal year 2008 is in the range of $0.08 to $0.12.

This compares to actual third quarter of fiscal year 2007 earnings per diluted share of $0.09. During the third quarter of fiscal year 2008, the Company plans to open approximately five stores, close two stores and remodel seven stores, ending the quarter with approximately 599 stores and 3.4 million selling square feet.

The Company expects comparable store sales to be in the low to mid negative single-digit range for the full fiscal year 2008 and now expects earnings per diluted share to be in the range of $0.52 to $0.60. This compares to the Company's previous guidance range of $0.44 to $0.54 and compares to actual fiscal year 2007 earnings per diluted share of $0.44.

During fiscal year 2008, the Company plans to open 25 to 30 stores, close approximately 12 stores and remodel approximately 13 stores, ending the fiscal year with 591 to 596 stores and approximately 3.3 million selling square feet in operation, with new stores representing approximately 105,000 selling square feet. Capital expenditures are estimated in the range of $52.0 million to $54.0 million in fiscal year 2008 versus $75.5 million in fiscal year 2007. Depreciation expense for the year is estimated at $44.0 million.

New York & Company Inc

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