COLUMBUS, Ohio — Express, a specialty retail apparel chain operating more than 620 stores, reported that fourth quarter net sales increased 8% to $728.7 million from $673.2 million in the fourth quarter of 2011. Comparable sales increased 1.5%, following a 5% increase in the fourth quarter of 2011.
Net income was $63.9 million, or 75 cents per diluted share. This compares to net income of $60.4 million, or 68 cents per diluted share in the fourth quarter of 2011.
Net sales for the full year increased 4%. Comparable sales for the year were flat, following a 6% increase in 2011.
Net income was $139.3 million, or $1.60 per diluted share. This compares to net income of $140.7 million, or $1.58 per diluted share, in 2011.
During the fourth quarter of 2012, the company opened 8 new stores, including 3 in Canada, and closed 1 store in the United States. For the full year 2012, the company opened 28 stores, including 5 in Canada, and closed 12 stores in the United States to end the year with 625 locations and 5.4 million gross square feet in operation. The company's international franchisees opened 4 stores in the fourth quarter and 8 stores during the year, ending 2012 with 15 locations across the Middle East and Latin America.
Michael Weiss, Express Inc.'s chairman and CEO commented, "We ended the year positively, with the initiatives we implemented in our women's business driving improved results. These initiatives included: re-balancing our sweater assortment, introducing entry price point fashion items in key categories, especially cut-and- sew knitwear, and communicating clearer pricing and promotional strategies. Our men's business continued its positive momentum and, along with disciplined expense and inventory management and the aforementioned women's initiatives, drove increased sales, positive comparable sales, and net income per diluted share above the increased guidance provided in the fourth quarter. We attribute our improved performance over the third quarter to the strength of our products, specifically sweaters and cut-and-sew knitwear, which we had previously identified as categories for improvement. In addition, we generated our third consecutive year of double digit e-commerce sales growth and achieved our store expansion goals. We were also pleased with our international expansion that included the opening of 4 additional franchise stores in the Middle East and our first four franchise locations in Latin America. Our balance sheet remained strong with cash and cash equivalents totaling $256.3 million at year end, even after investing $65.1 million to repurchase 4.0 million shares of common stock during the year. As we begin 2013, we expect to advance each of our existing four pillars of growth. In addition, we are also excited to pursue a new growth opportunity in 2013 through the development of a new Express outlet business."
"While our guidance anticipates a softer start to the year, reflecting the impact of reduced traffic levels and consumer spending in the month of February, our spring merchandise has been received favorably by our customers, resulting in an improvement in conversion, which we do consider to be a leading indicator, early in the first quarter," commented Weiss.
The company expects first quarter of 2013 comparable sales, including e-commerce, to range from flat to down low single digits compared to an increase of 4% in the first quarter of 2012. Net income is expected in the range of $29.5 million to $32.5 million, or 34 cents to 38 cents per diluted share on 85.5 million weighted average shares outstanding.
The Company expects full year 2013 comparable sales, including e-commerce, to increase low single digits compared to a flat performance in 2012. Net income is expected in the range of $120 million to $132 million, or $1.40 to $1.54 per diluted share.