chico’s-fas-registers-$46.8-million-loss-in-most-recent-quarter

Chico’s FAS Registers $46.8 Million Loss in Most Recent Quarter

Chico’s FAS continues to register losses.  ” data-reactid=”19″ type=”text”>Chico’s FAS continues to register losses.  

The Fort Myers, Fla.-based retailer —  parent company to the Chico’s, White House Black Market, Soma and TellTale brands  reported quarterly earnings Wednesday before the market opened, falling short on both top and bottom lines, with a $46.8 million loss for the three-month period ending Aug. 1. That’s on top of the $178 million loss the prior quarter thanks to the coronavirus shutdown. ” data-reactid=”20″ type=”text”>The Fort Myers, Fla.-based retailer —  parent company to the Chico’s, White House Black Market, Soma and TellTale brands  reported quarterly earnings Wednesday before the market opened, falling short on both top and bottom lines, with a $46.8 million loss for the three-month period ending Aug. 1. That’s on top of the $178 million loss the prior quarter thanks to the coronavirus shutdown. 

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  • “Our core strengths [are] three distinctive brands with new product being well received, a strong digital platform, a differentiated real estate portfolio, our loyal customer base and solid balance sheet position us for success,” Molly Langenstein, chief executive officer and president of Chico’s FAS, said in a statement. “We are taking advantage of this unprecedented period by capitalizing on these strengths and staying laser focused on continuing our successful turnaround strategy, including accelerating digital growth.” data-reactid=”28″ type=”text”>“Our core strengths [are] three distinctive brands with new product being well received, a strong digital platform, a differentiated real estate portfolio, our loyal customer base and solid balance sheet position us for success,” Molly Langenstein, chief executive officer and president of Chico’s FAS, said in a statement. “We are taking advantage of this unprecedented period by capitalizing on these strengths and staying laser focused on continuing our successful turnaround strategy, including accelerating digital growth.

    “As I enter my second year with the business, the things we learned and improved last fall have been accelerated into the back half of this year,” Langenstein continued. “In the second quarter, we substantially enhanced our financial performance despite pandemic headwinds. Compared to the first quarter, our second quarter digital and store sales trends improved 9.2 percent and gross margin rate rose more than 1,800 basis points. Store and digital conversion rates improved in the second quarter, providing an indicator that our product changes to comfort, casual and easy care fabrics are resonating with customers, giving us confidence our financial and product initiatives combined with relentless customer focus have positioned us to emerge a stronger company.”” data-reactid=”29″ type=”text”>“As I enter my second year with the business, the things we learned and improved last fall have been accelerated into the back half of this year,” Langenstein continued. “In the second quarter, we substantially enhanced our financial performance despite pandemic headwinds. Compared to the first quarter, our second quarter digital and store sales trends improved 9.2 percent and gross margin rate rose more than 1,800 basis points. Store and digital conversion rates improved in the second quarter, providing an indicator that our product changes to comfort, casual and easy care fabrics are resonating with customers, giving us confidence our financial and product initiatives combined with relentless customer focus have positioned us to emerge a stronger company.”

    Total company revenues for the period were $306 million, down from $508 million the same time last year. By brand, top-line sales at Chico’s were $139 million, compared with nearly $269 million a year ago. White House Black Market’s revenues totaled $82 million, compared with about $140 million a year ago. Even intimates brand Soma, which has been a standout for several quarters, fell short with $84 million in total sales, compared with $99.6 million a year ago. ” data-reactid=”30″ type=”text”>Total company revenues for the period were $306 million, down from $508 million the same time last year. By brand, top-line sales at Chico’s were $139 million, compared with nearly $269 million a year ago. White House Black Market’s revenues totaled $82 million, compared with about $140 million a year ago. Even intimates brand Soma, which has been a standout for several quarters, fell short with $84 million in total sales, compared with $99.6 million a year ago. 

    The company widened its losses at $46.8 million during the quarter as a result, compared with losses of $2.3 million during 2019’s second quarter. ” data-reactid=”31″ type=”text”>The company widened its losses at $46.8 million during the quarter as a result, compared with losses of $2.3 million during 2019’s second quarter. 

    Like most retailers, Chico’s FAS was forced to temporarily shut down all of its brick-and-mortar locations in mid-March to prevent the spread of the coronavirus. Stores did not begin to reopen until late May. As of Aug. 1, 96 percent of the company’s 1,313 stores in the U.S. had reopened. Chico’s FAS also sells merchandise through 69 international franchise locations in Mexico and two domestic franchise airport locations. ” data-reactid=”32″ type=”text”>Like most retailers, Chico’s FAS was forced to temporarily shut down all of its brick-and-mortar locations in mid-March to prevent the spread of the coronavirus. Stores did not begin to reopen until late May. As of Aug. 1, 96 percent of the company’s 1,313 stores in the U.S. had reopened. Chico’s FAS also sells merchandise through 69 international franchise locations in Mexico and two domestic franchise airport locations. 

    The company said it will continue to evaluate its retail fleet and exit unprofitable stores while continuing to negotiate rent reductions and abatements with current landlords. ” data-reactid=”33″ type=”text”>The company said it will continue to evaluate its retail fleet and exit unprofitable stores while continuing to negotiate rent reductions and abatements with current landlords. 

    In July, Chico’s FAS Canada, a subsidiary of Chico’s FAS, filed for bankruptcy with the Ontario, Canada, office of the Superintendent in Bankruptcy, to help reduce expenses.  ” data-reactid=”34″ type=”text”>In July, Chico’s FAS Canada, a subsidiary of Chico’s FAS, filed for bankruptcy with the Ontario, Canada, office of the Superintendent in Bankruptcy, to help reduce expenses.  

    The move meant all 10 of its stores in Canada — four Chico’s and six White House Black Market locations — would close permanently. The company continues to operate its e-commerce platforms in Canada.” data-reactid=”35″ type=”text”>The move meant all 10 of its stores in Canada — four Chico’s and six White House Black Market locations — would close permanently. The company continues to operate its e-commerce platforms in Canada.

    Meanwhile, with stores closed, the company’s e-commerce businesses continued to grow. Digital sales in the apparel and intimates categories across all the three major brands increased double digits year-over-year. At Soma, digital sales surged 70 percent during the quarter, year-over-year. ” data-reactid=”36″ type=”text”>Meanwhile, with stores closed, the company’s e-commerce businesses continued to grow. Digital sales in the apparel and intimates categories across all the three major brands increased double digits year-over-year. At Soma, digital sales surged 70 percent during the quarter, year-over-year. 

    Selling, general and administrative expenses were reduced by 37 percent during the quarter, year-over-year. Chico’s FAS ended the quarter with more than $124 million in cash and equivalents and $149 million in long-term debt. ” data-reactid=”37″ type=”text”>Selling, general and administrative expenses were reduced by 37 percent during the quarter, year-over-year. Chico’s FAS ended the quarter with more than $124 million in cash and equivalents and $149 million in long-term debt. 

    Shares of Chico’s FAS, which closed down 3.76 percent to $1.28 a piece, are down nearly 58 percent year-over-year. ” data-reactid=”38″ type=”text”>Shares of Chico’s FAS, which closed down 3.76 percent to $1.28 a piece, are down nearly 58 percent year-over-year. 

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