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Charming Shoppes amends earnings guidance for year ending Jan, 28

08 Jul '05
7 min read

Continuing growth in e-commerce for each of the Company's retail store brands also contributes to the Company's year over year increase in projected sales.

Gross Margin
The Company projects expansion in its reported gross margin to a range of 30.0% - 30.4% of sales for the fiscal year ending January 28, 2006, primarily as a result of continued improvement at Lane Bryant and improving margins at Catherines Plus Sizes.

Expenses
The Company estimates that Selling, General and Administrative expenses, as a percent of sales, will be approximately 24.0% - 24.4% for the fiscal year ending January 28, 2006. The expense plan for the year includes increases in store payroll, occupancy, healthcare benefits, and information technology, as well as expenses related to the operation of Crosstown Traders Inc.

Additional Data: Interest expense is projected at approximately $23 million for the year. The increase in interest expense is related to the Company's borrowings on its revolving line of credit in connection with the acquisition of Crosstown Traders, Inc. Depreciation and Amortization (D&A) is projected in a range of $80 - $85 million for the year.

Capital Expenditures are projected at $95 - $105 million.

Approximately three-quarters of the Company's capital expenditure plan supports store development, including openings, relocations, and store improvements. The remainder is primarily planned for improvements in the Company's information technology and corporate infrastructure. The Company's revised projection includes estimated weighted average diluted shares of 137 million and a tax rate in a range of 36% to 37%.

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