PacSun Results Disappoint

Commenting on same-store sales that decreased 5.5% for the second quarter, CEO Seth Johnson said, "Clearly, the quarter was very disappointing. Our comp was negative in each month of the quarter, and fell off significantly in the latter part of July."

Although it is still early in the back-to-school selling period, "Back -to-school business got off to a slow start," Johnson said. "At this point it is difficult to determine if the slowdown reflects weakness in our back-to-school assortment or broader economic issues affecting the retail industry overall." Johnson and other PacSun executives discussed the company's quarterly results in a conference call with financial analysts.

In answer to an analyst's question, Johnson said that PacSun has "no intention of transitioning our business in any way away from the core surf-skate brand" on which it has been built. He added, however, that "Another part of the heritage of PacSun is that we are always adding and trying new things in our brand mix."

Pacific Sunwear, which operates three retail concepts called PacSun, 201 d.e.m.o. and One Thousand Steps, opened what Johnson called "our last three new One Thousand Steps stores for this year" in the second quarter. Those locations, opened last week, are in New Jersey, Long Island and Northridge, CA, for a total of nine of the One Thousand Steps formats.

PacSun will announce its store growth plans for 2007 later this year, Johnson said in the conference call. The company now operates 826 PacSun stores, 102 PacSun Outlet stores, 201 d.e.m.o. stores and the One Thousand Steps stores for a total of 1,135 stores in 50 states and Puerto Rico.