Retailers, consumers and prices
Talbots, whose clientele consists mainly of women above 35 years old, reported a first-quarter loss of 23 cents a share, less than half the 49-cent loss analysts had expected.
The company, majority owned by Japan’s Aeon Co Ltd, also said it would cut corporate headcount by about 20 percent in a move to save $150 million annually.
The loss came a day after Talbots agreed to sell its J.Jill division to Golden Gate Capital for $75 million just three years after buying it for $517 million. That sale is part of Talbots efforts to focus on turning around its core business and newly launched upscale outlet.
Check out Talbots’ sales forecast.
The struggling women’s apparel retailer said it expects same-store sales to be flat at its namesake stores in the current quarter and down low-to-mid single digits at its J. Jill stores.
That looks like progress, especially at the Talbots’ brand.
But, wait. Hasn’t the weakness in women’s apparel has been going on for some time now. So the glass-half-empty view would be to look at how that forecast compares with a year ago.
Same-store sales at Talbots’ stores fell 8.2 percent last year (and J. Jill same-store sales fell 6.5 percent).
So there might be some improvement coming at Talbots’, but it is off a weak comparison.
Then again, with how women’s apparel has gone lately, flat same-store sales might be a welcome new fashion trend.
Also in the basket:
Dollar Tree posts higher quarterly profit
Brown Shoe 2nd-quarter profit down; cuts outlook
Urban Outfitters Fashion Growth Plan (Wall Street Journal)
Check out the majority owner of Talbots exerting more control.
The women’s apparel retailer, which has endured hardships in recent months including falling sales, job cuts, an executive departure and a credit problem, said on Thursday that Tsutomu Kajita would become chairman of its board.
Kajita is senior vice president of international operations for Japan’s Aeon Co, Talbots’ majority owner.
Apparently the tough U.S. retail environment is not age-specific.
American Eagle Outfitters, which sells teen apparel said fourth-quarter profit fell more than 6 percent amid weak sales, higher markdowns and competition from rivals.
The retailer also forecast first-quarter earnings well below analysts’ expectations as it has had to take higher markdown.