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Chico's experiences second-quarter free-fall in profits
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Fort Myers-based women's retailer Chico's FAS Inc. reported a more than 80 percent drop in its profits for the second quarter.
Net income for the second quarter was $6.7 million, or 4 cents a share, down from $38.7 million, or 22 cents a share a year ago.
Net sales for the quarter dropped 7.1 percent to $405.2 million, from $436 million a year ago.
Comparable store sales fell 15.9 percent in the thirteen weeks ending Aug. 2.
In a conference call Tuesday morning, Scott Emonds, the company's chairman, president and CEO, called the results disappointing.
He attributed the lower profits mainly to lower than anticipated sales and higher markdowns made to drive sales and reduce inventories.
Like other retailers, Chico's is struggling to make sales in a tough economy. But Edmonds said he expects the company to remain profitable in the second half of the year as it works to cut expenses and better manage its inventories.
The company has three brands: Chico's, White House/Black Market and its newer Soma Intimates.
Earnings results were announced before the market opened today. Shares closed at $4.98 on the New York Stock Exchange on Monday.
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The company is in a tailspin. Quick, boardmembers, grant that CEO a raise and stay-put bonus of at least $20 million.
#1 Posted by Bramble on August 26, 2008 at 1:36 p.m. (Suggest removal)
This company really ticked off my wife. She would never shop there again with rude clerks and little quality for their purses and junky costume jewelry. She was pretty enthralled with them a while back, but something happened to their approach to the consumer. I almost bought the stock because I could see how happy my wife was with some of the things she got. But the philosophy did a big about face and I glad I didn't invest in this company, now.
#2 Posted by BlueTonguedVole on August 26, 2008 at 1:53 p.m. (Suggest removal)
you mean Mrs. Obama's dress (the one she wore and everyone then HAD to have) didn't raise the sales enough for $38.7M profit?
I smell another WCI here...
#3 Posted by neapolitan12345 on August 26, 2008 at 3:46 p.m. (Suggest removal)
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