Fashion apparel retailer Express, Inc. reported a net sales decrease of 14 percent to 514.3 million dollars in the fourth quarter of 2021, with consolidated comparable sales down 13 percent.
Full year consolidated net sales decreased to 1,864 million dollars from 1,870 million dollars in 2021, with consolidated comparable sales flat.
"We delivered full year 2022 diluted earnings per share of 4.25 dollars which reflects the after tax impact of the gain of 409 million dollars recognised upon completing the transaction with WHP Global. This transformative strategic partnership begins a bold, new chapter for our company," said Tim Baxter, the company’s chief executive officer.
"While we expect the margin pressure and recessionary environment we experienced in the back half of the year to continue, we have identified and begun to realise 40 million dollars in annualised expense savings in early 2023 and are working to identify additional expense savings opportunities in 2023 and beyond," Baxter added.
Highlights of Express Q4 and full year results
The company’s fourth quarter comparable retail sales, which includes both Express stores and ecommerce, were down 15 percent compared to the fourth quarter of 2021. Retail store comparable sales decreased 11 percent while ecommerce declined 19 percent. Comparable outlet sales decreased 7 percent compared to the fourth quarter of 2021.
For the full year, comparable retail sales, which includes both Express stores and ecommerce, decreased 2 percent, retail stores increased 5 percent and comparable outlet sales increased 4 percent versus 2021.
Gross margin for the quarter was 23.9 percent of net sales, a decrease of approximately 530 basis points. Full year gross margin was 28.4 percent, a decrease of approximately 150 basis points.
Net income was 333.2 million dollars or 4.82 dollars per diluted share, while adjusted net loss was 43.1 million dollars or a loss of 63 cents per diluted share, for the fourth quarter of 2022.
Net income was 293.8 million dollars or 4.25 dollars per diluted share for the year compared to a net loss of 14.4 million dollars or 22 cents per diluted share, in 2021. On an adjusted basis, net loss was 82.4 million dollars or 1.21 dollars per diluted share in 2022.
Fourth quarter EBITDA was 385.8 million dollars, which included the 409.5 million dollars gain on the transaction with WHP Global, compared to 25.8 million dollars in the fourth quarter of 2021. Adjusted EBITDA was negative 10.1 million dollars.
Full year EBITDA was 402.7 million dollars, including the WHP Global transaction, compared to 64.7 million dollars in 2021, while adjusted EBITDA was 6.8 million dollars in 2022.
Express expects to report loss in FY23
For the first quarter, the company expects comparable sales of negative low-double digits, gross margin rate to decrease approximately 850 basis points and diluted loss per share of 70 cents to 80 cents.
For fiscal 2023, the company expects comparable sales of positive low-single digits and diluted loss per share of 85 cents to 1.05 cent.