The Children’s Place is the latest retailer to say heavy promotions and bad weather hurt its fourth-quarter results.
The company’s net earnings in the quarter ended Feb. 1 dropped 18% to $15.7 million, from $19.1 million in the year-ago period, which had an extra week. It reported net sales of $467.5 million for the quarter, down from $509.2 million in the year-ago period. Same-store sales declined 4.3%.
Store impairment charges related to the continued review of underperforming stores and early closure expenses also negatively affected the company’s results.
For the full year, the company reported net sales of $1.7 billion, compared to $1.8 billion last year. Same-store sales fell 2.8%. Net income was $53 million, compared to $63.2 million for the previous year.
“The Children's Place delivered fiscal 2013 earnings near the top end of our guidance range despite an intensely promotional environment and a series of storms brought on by the polar vortex in the fourth quarter," said Jane Elfers, president and CEO. "2013 was a challenging year but we demonstrated our ability to deliver solid financial results through a combination of superior value, tight expense discipline, strong merchandise offerings that resonated with our customers and well-controlled inventories."
Children’s Place said it plans to change its name from 'The Children's Place Retail Stores' to 'The Children's Place' to better reflect its strategic positioning as a global children's brand.
The company also plans to open approximately 35 stores and close 30 existing locations, and plans to double its international store count to about 65-70 locations, as well as close a total of 125 underperforming stores through 2016. Other plans include increasing its e-commerce business and completing the rollout of a North American ERP system.