Ascena Retail reports 5 percent rise in Q1 net sales

REPORT_ Ascena Retail Group in its financial results

for its fiscal first quarter ended October 26, 2013 said that its net sales for the first quarter of fiscal 2014 increased 5 percent to 1.197 billion dollars, compared to 1.138 billion dollars in the prior year’s first quarter. This growth was driven by a consolidated total comparable sales increase of 4 percent for the quarter versus the prior year. Consolidated comparable store sales increased 2 percent for the period. Consolidated e-commerce sales increased by 27 percent to 106 million dollars.

Earnings from continuing operations were 0.33 dollars per diluted share, while losses from discontinued operations were 0.01 dollars per diluted share. This compares to earnings from continuing operations of 0.29 dollars per diluted share and losses from discontinued operations of 0.02 dollars per diluted share in the same period of fiscal 2013. Adjusted earnings from continuing operations in the first quarter of fiscal 2014 were 0.36 dollars per diluted share, compared to 0.39 dollars per diluted share in the prior year’s first quarter.

Commenting on the results, David Jaffe, President and Chief Executive Officer of Ascena Retail Group said, “We were pleased that our top line momentum continued into the first quarter, with all of our brands generating positive total comps. We also continued to make progress on our strategic priorities during the quarter, including our synergy initiatives, which will position the business for long term growth.”

Gross margin for the first quarter of fiscal 2014 increased to 710.0 million dollars, or 59.3 percent of sales, compared to 656.6 million dollars, or 57.7 percent of first quarter sales last year on a reported basis. On an adjusted basis, gross margin for the first quarter of fiscal 2013 was 676.5 million dollars, or 59.5 percent of sales.

The Suffern, New York-based company reaffirms guidance for adjusted earnings per diluted share from continuing operations for the fiscal year ending July 2014 in the range of 1.25 dollars to 1.30 dollars. Total comparable sales are expected to increase low single digits, effective tax rate is expected to increase for the remainder of the year for a full year estimated tax rate of 38.5 percent, investment in capital expenditures is assumed to be in the range of 425 to 450 million dollars. New store openings are planned to be 180 to 190 stores, with 130 to 140 store closures.