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Destination Maternity sales decreased 4.3%

Staff writer ▼ | October 9, 2014
Destination Maternity Corporation reported sales for the fourth quarter and full year fiscal 2014 ended September 30, 2014.
Destination Maternity
Results   To $517 million from $540.3 million
Net sales for the fiscal year ended September 30, 2014 decreased 4.3% to $517 million from $540.3 million reported for the full year fiscal 2013.

The decrease in total reported sales for the full year fiscal 2014 compared to the full year fiscal 2013 resulted primarily from the decrease in comparable sales and decreased sales related to the Company's continued efforts to close underperforming stores.

Total sales of $517.0 million for the full year fiscal 2014 were below the low end of the Company's sales guidance range of $519.5 to $524.0 million provided in its July 30, 2014 press release, primarily due to the reported comparable sales decrease of 3.7%, which was below the low end of the Company's guidance range for a comparable sales decrease of between 2.3% and 3.0% for the year.

The Company attributes this sales weakness to a number of factors, including a continued difficult overall economic and retail environment which resulted in decreased store traffic, and weaker consumer reception than expected to the Company's merchandise assortments.

The Company's sales for the full year fiscal 2014 were below the low end of the Company's expected sales range and, as a result of this sales shortfall, higher than planned price promotional and markdown activity to manage inventory, and management and organizational changes initiated during the fourth quarter, the Company expects diluted earnings per share for the full year to be between $0.81 and $0.86 per share, which is below the low end of the Company's prior earnings guidance range of $1.11 to $1.21 per share that was provided in the Company's July 30, 2014 press release, and significantly lower than fiscal 2013 earnings of $1.78 per share.

The Company's full year fiscal 2014 earnings per share are expected to include approximately $0.14 per share of other charges (income) related to the previously announced relocation of the Company's headquarters and distribution facilities, the Company's now withdrawn proposal for a business combination with Mothercare plc, management and organizational changes initiated by the Company during the fourth quarter, and the gain on sale of the Company's current headquarters/distribution facility.

Excluding the other charges (income), the Company's adjusted earnings for fiscal 2014 are expected to be between $0.95 and $1.00 per share, compared to the Company's previous guidance of adjusted earnings between $0.97 and $1.07 per share, and fiscal 2013 adjusted earnings of $1.69 per share.

Net sales for the fourth quarter of fiscal 2014 decreased 4.8% to $122 million from $128.3 million reported for the fourth quarter of fiscal 2013.


 

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