Home / Knowledge / News / Apparel/Garments / Chico's FAS reports net loss of $2.3 mn in revenue in Q2

Chico's FAS reports net loss of $2.3 mn in revenue in Q2

31
Aug '19
Pic: Chico
Pic: Chico's FAS
For the thirteen weeks ending August 3, 2019, Chico's FAS reported a net loss of $2.3 million in revenue compared to net income of $16.8 million for the thirteen weeks ending August 4, 2018. For the twenty-six weeks ending August 3, 2019, the company reported a net loss of $0.3 million, compared to net income of $45.8 million for the same period last year.

For the second quarter of fiscal 2019, the company announced the appointment of Bonnie Brooks as CEO and president of Chico's FAS and a new organisational structure for the company. Molly Langenstein was appointed president, Apparel Group, leading Chico's and White House Black Market (WHBM), and Mary van Praag, president, Intimates Group, will continue to lead Soma and TellTale, said Chico's FAS in a press release.

Soma reported positive 10.9 per cent comparable sales growth in the second quarter, the brand's best comparable sales performance in four years, and remains a leading performer in the industry.

Chico's comparable sales improved sequentially compared to the first quarter, driven by momentum in key items and better in-stock positions.

WHBM comparable sales were lower sequentially compared to the first quarter due to product misses in colour and print, which were identified in the first quarter and have been addressed through significant leadership changes and a more rigorous approval process. The sales trends in the Fall 1 assortment, set in stores and online in early August, have improved. The company anticipates the performance at the brand to gradually improve throughout the fall and holiday seasons.

"We are seeing evidence of progress within our business and reported second quarter results in line with our expectations. This performance was driven by sequential improvement at Chico's and continued strong comparable sales growth at Soma of 10.9 per cent in the second quarter. At White House Black Market, the changes we made in product, marketing and in-store presentation are driving improved sales trends in August compared to our second quarter results. We expect these improvements to continue benefiting the brand throughout the fall and holiday seasons," said Bonnie Brooks, CEO and president of Chico's FAS.

"We are committed to enhancing value creation at Chico's FAS and are taking the necessary steps to do so. We have made significant leadership changes and are focused on executing on our three operating priorities to deliver sustainable, profitable growth," added Brooks.

For the fiscal 2019 third quarter, the company anticipates a low to mid-single-digit decline in total net sales and consolidated comparable sales compared to the fiscal 2018 third quarter. The company expects gross margin as a percent of net sales to be down approximately 100 to 125 basis points as it clears through seasonal inventory.

For full year fiscal 2019, the company anticipates a mid-single digit decline in total net sales and consolidated comparable sales, versus its previous guidance of a low to mid-single-digit decline in total net sales and consolidated comparable sales.

Chico's FAS, through its brands – Chico's, White House Black Market, Soma and TellTale is a leading omni-channel specialty retailer of women's private branded, sophisticated, casual-to-dressy clothing, intimates and complementary accessories. (PC)

Fibre2Fashion News Desk – India


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