Earnings for the quarter ending Oct. 29 dropped to $20 million, or 37 cents per share, down from $27.2 million, or 49 cents, for the same period last year, when it recorded a $4.5-million tax benefit, the clothing retailer said. The earnings beat by a penny Wall Street estimates of 36 cents per share.
Quarterly sales were up 3% to $426.3 million from $413.4 million a year earlier but sales at Talbot stores open at least a year fell 2%, largely due to "softness in September trends," the retailer said. The decline in comparative store sales followed nine consecutive months of positive growth for the company.
The Hingham, MA-based clothing firm, which operates 1,081 stores throughout the United States, Canada and the United Kingdom, said was poised for a strong holiday season. but was paring down expected earnings for the current quarter to between 35 cents and 37 cents per share, below the 39 cents it estimated in October. Analysts said they expect earnings for the period to be 37 cents.
The company also said it was reconsidering the way it stocks merchandise from August through October to avoid a repeat of this year's sluggish September sales when unusually warm weather led to a downturn in consumer demand for sweaters and coats.
The company said it also was continuing with expansion plans and has added 22 new locations during the third quarter with an additional 10 stores set to open by the end of the year.
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