Ascena says its second quarter revenue got a big boost from the acquisition of Ann Inc., but same-store sales declined sharply during the period.
For the second quarter ended Jan. 23, the companyreported a net loss of 12 cents per diluted share compared to net income of 5 cents per diluted share in the same period of fiscal 2015.Net sales were $1.842 billion compared to $1.289 billion last year, with the increase driven by the acquisition of Ann Inc. Second quarter total comparable sales were down 6%.
"Our second quarter earnings performance came in just above the pre-announced range we shared in mid-January, due mainly to strengthening performance at Loft and margin rate favorability at Justice," saidDavid Jaffe, president and CEO of Ascena retail group, inc. "Adjusted operating income growth for the quarter was driven primarily by Ann Inc., and integration activity continues to progress well. We are pleased with the progression of the Justice turnaround, and remain confident in our full year plan. Maurices delivered another solid quarter, and we continue to see improvement at Lane Bryant."
Looking ahead, the company is reaffirming its full year adjusted earnings per share outlook in the range of 75 to 80 cents, with third quarter earnings per share expected in the range of 10 to 14 cents, and the remainder of approximately 28 cents coming in the fourth quarter.
"Our focus on tight inventory management allowed us to deliver strong gross margin rate improvement for the quarter despite changing customer behavior around Black Friday, and continued traffic headwinds that weighed on sales performance," Jaffe added. "We exited the second quarter with inventory well-managed, and will remain disciplined in this area as we continue to navigate the dynamic consumer landscape."