The Children's Place posts increase in Q4 profit
Prachi Singh| Tuesday, March 17 2020
The Children’s Place, Inc. reported net sales decrease of 3.3 percent to 513 million dollars in the fourth quarter, primarily as a result of a comparable retail sales decrease of 3.6 percent. The company said in a statement that net income for the quarter was 24.2 million dollars or 1.61 dollars per diluted share compared to 12 million dollars or 74 cents per diluted share, in the three months ended February 2, 2019, while adjusted net income was 28 million dollars or 1.85 dollars per diluted share, compared to 17.9 million dollars or 1.10 dollars per diluted share, in the comparable period last year.
Commenting on the results, Jane Elfers, the company’s President and Chief Executive Officer said: “We delivered Q4 EPS significantly above the high-end of our guided range. Sales exceeded our expectations with our digital business representing 31 percent of our total sales in Q4. Our consolidated comp was running up low-single digits through the first five weeks of Q1, despite the early impact from COVID-19. However, since then, the impact on demand from the evolving COVID-19 pandemic has become significantly greater. As a result of the uncertainty surrounding the impact and duration of the COVID-19 pandemic, we will not be providing forward guidance at this time.”
Full year net sales decrease 3.5 percent
Net sales for the full year decreased 3.5 percent to 1.871 billion dollars due to comparable retail sales decrease of 2.7 percent. Net income was 73.3 million dollars or 4.68 dollars per diluted share, in the twelve months period compared to 101 million dollars or 6.01 dollars per diluted share, in the twelve months ended February 2, 2019, while adjusted net income was 83.8 million dollars or 5.36 dollars per diluted share, compared to 113.4 million dollars or 6.75 dollars per diluted share, in the comparable period last year.
Gross profit for the year was 655.3 million dollars compared to 683.6 million dollars and adjusted gross profit was 655.3 million dollars in the twelve months to February 1, 2020 compared to 687.4 million dollars in the comparable period last year, and deleveraged 50 basis points to 35 percent of net sales.
The company opened two stores and closed 33 stores in the three months ended February 1, 2020 and ended the quarter with 924 stores and square footage of 4.3 million, a decrease of 4 percent compared to the prior year. Since fleet optimization initiative was announced in 2013, the company has closed 271 stores. The company’s international franchise partners opened six net new points of distribution in the fourth quarter and the company ended the quarter with 266 international points of distribution open and operated by its eight franchise partners in 19 countries.
Picture:Facebook/The Children's Place