The Wet Seal, Inc. Announces January Comparable Store Sales Declined 9.4%
February 07 2013 - 7:00AM
Business Wire
The Wet Seal, Inc. (Nasdaq: WTSLA), a leading specialty retailer
to young women, reported net sales and comparable store sales for
the five-week period ended February 2, 2013, or fiscal January, and
the fiscal fourth quarter ended February 2, 2013, as follows:
Fiscal January
Net Sales (1)(3)
Comparable Store Sales
% Change (2)(3)
$ in Millions
% Change From
Last Year
This Year
Last Year
Wet Seal $ 32.0 17.2 % -13.4 % -13.0 % Arden B
8.0 55.3 % 22.8 %
-12.7 % Total $ 40.0 23.3 % -9.4 %
-13.0 %
Fiscal Fourth Quarter
Net Sales (1)(3)
Comparable Store Sales
% Change (2)(3)
$ in Millions
% Change From
Last Year
This Year
Last Year
Wet Seal $ 137.2 -1.1 % -9.1 %
-4.6 % Arden B 24.5 0.7 % -3.1 %
-11.0 % Total $ 161.7
-0.9 % -8.3 % -5.5 %
(1)
Net sales for fiscal January and the
fourth quarter of the current year include five weeks and fourteen
weeks, respectively, while net sales for fiscal January and the
fourth quarter of the prior year include four weeks and thirteen
weeks, respectively.
(2)
Comparable store sales for fiscal January
and the fourth quarter of the current year are versus the
comparable five weeks and fourteen weeks, respectively, from the
prior year. Comparable store sales for fiscal January and the
fourth quarter of the prior year are versus the comparable four
weeks and thirteen weeks, respectively, from the preceding
year.
(3)
Net sales at Arden B for fiscal January
and the fourth quarter of the current year include store closure
sales associated with 18 locations, which took place during the
course of the month. These stores generated sales of $1.6 million
and $0.7 million in fiscal January of the current year and prior
year, respectively, and are not included in the current year
comparable store sales results.
E-commerce net sales, which are not included in comparable store
sales, increased 29.8% and 13.9% in fiscal January and the fiscal
fourth quarter, respectively. Such increases include the benefit
from the additional week in both fiscal January and the fourth
quarter in the current year. Excluding the impact of the additional
week, e-commerce net sales increased 6.5% and 8.5% in fiscal
January and the fiscal fourth quarter, respectively.
John D. Goodman, the Company’s Chief Executive Officer,
commented, "Our overall January sales results were below our
expectations due to a comparable store sales decline in Wet Seal,
partially offset by improved performance at Arden B.
“At Wet Seal, while sales were strong in the first week of
January, business slowed considerably during the course of the
month, driven by transaction declines. We responded with aggressive
promotional and clearance strategies, enabling us to end the fiscal
year with a clean inventory position from which to build our spring
assortment in the coming weeks.
“At Arden B, we saw encouraging progress. A shift in New Year’s
Eve from fiscal December last year to the first week of January
this year benefited business considerably. Excluding this first
week, however, Arden B January comparable store sales still
increased in the low single digits, representing sequential
improvement in business trends versus recent months.”
Fiscal Fourth Quarter Guidance
The Company continues to estimate its fourth quarter loss per
diluted share, before the effect of one-time charges and non-cash
asset impairments, will be $0.06.
As previously disclosed, the Company estimates it will incur
$1.3 million in one-time pre-tax severance charges for workforce
reductions that occurred last week. The Company also estimates it
will incur a $0.7 million one-time pre-tax charge upon the early
termination of two investment banker retention agreements. Lastly,
the Company is evaluating several Wet Seal and Arden B stores for
potential non-cash asset impairments. The one-time charges and
potential asset impairment charges are not included in prior or
current guidance and will increase the Company’s loss per diluted
share for the quarter.
Discontinuation of Monthly Sales Reporting
As a reminder, the Company will now discontinue monthly sales
reporting. This aligns the Company’s sales reporting cadence with
most of its public company competitors and other specialty apparel
retailers. The Company will report quarterly sales results on the
first Thursday following the close of each fiscal quarter, with the
first such report to occur on Thursday, May 9, 2013.
About The Wet Seal, Inc.
Headquartered in Foothill Ranch, California, The Wet Seal, Inc.
is a leading specialty retailer of fashionable and contemporary
apparel and accessory items. As of February 2, 2013, the Company
operated a total of 530 stores in 47 states and Puerto Rico,
including 468 Wet Seal stores and 62 Arden B stores. The Company’s
products can also be purchased online at www.wetseal.com or
www.ardenb.com. For more Company information, visit
www.wetsealinc.com.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995: This news release contains forward-looking
statements as that term is defined in the Private Securities
Litigation Reform Act of 1995. These forward-looking statements
include, but are not limited to, statements that relate to the
Company’s estimated fourth quarter loss per share and year-end
inventories, as well as the intent, belief, plans or expectations
of the Company or its management. All forward-looking statements
made by the Company involve material risks and uncertainties and
are subject to change based on factors beyond the Company’s
control. Accordingly, the Company’s future performance and
financial results may differ materially from those expressed or
implied in any such forward-looking statements. Such factors
include, but are not limited to, those described in the Company’s
filings with the Securities and Exchange Commission. This news
release contains results reflecting partial year data and
non-fiscal data that may not be indicative of results for similar
future periods or for the full year. The Company will not undertake
to publicly update or revise its forward-looking statements even if
experience or future changes make it clear that any projected
results expressed or implied therein will not be realized.
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