NEW YORK, Oct. 7 /PRNewswire-FirstCall/ -- AnnTaylor Stores Corporation
(NYSE: ANN) announced today total net sales for the five-week period ended
October 2, 2004 increased 16.9 percent to $187,667,000 over total net sales of
$160,484,000 for the five-week period ended October 4, 2003. By division, net
sales were $79,722,000 for Ann Taylor compared to $83,580,000 last year, and
$89,969,000 for Ann Taylor Loft compared to $64,488,000 last year.
Comparable store sales increased 1.4 percent for the period, compared to a
comparable store sales increase of 6.9 percent for the same five-week period
last year. By division, comparable store sales for fiscal September 2004 were
down 5.1 percent for Ann Taylor compared to a 0.8 percent increase last year,
and up 10.2 percent for Ann Taylor Loft compared to a 17.1 percent increase
Ann Taylor Chairman, J. Patrick Spainhour, said, "Ann Taylor Loft
experienced continued strong momentum through September, marking its 18th
consecutive month of positive comparable store sales. All separates, petites,
jackets, outerwear and fashion accessories delivered double-digit comparable
increases. 'Fashion newness' such as cropped pants, bold patterns, colorful
outerwear, item jackets, shrugs, ponchos, wraps and jewelry, were standouts.
The Ann Taylor division did not meet our internal expectations, which resulted
in greater promotional activity. The miss was primarily due to sweaters,
where our offering was too narrow and too deep, and pants, where sales
increased over last year yet were not in line with our inventory levels. Our
client reacted favorably to suits, jackets, woven tops and a variety of
accessories such as handbags and silk wraps."
The Company estimates that Hurricanes Frances, Ivan and Jeanne reduced
September sales by approximately $3,000,000. The stores that were impacted
represented 8% of total stores.
Mr. Spainhour continued, "The initial sales level that we saw at Ann
Taylor in September did not build through the balance of the month, which may
be partly attributable to increasing macroeconomic concerns surrounding the
economy. In light of this, our expectation for October is for comparable
store sales to be in the low to mid single-digit positive range for both
divisions. We are revising our earnings guidance for the third quarter to the
range of $0.28 - $0.32 per share on a diluted basis, down from our previous
guidance of $0.48 - $0.50."
"In the fourth quarter, we will anniversary and evolve the holiday gifting
campaign that was so successful for us last year. The penetration rate of
giftables will increase to 64 percent at Ann Taylor (versus 61% last year) and
65% at Ann Taylor Loft (versus 62% last year). We believe that our Holiday
collections at both Ann Taylor and Loft will be well received. The current
sales level at the Ann Taylor division, however, has impacted our fourth
quarter estimate. Accordingly, we are revising our earnings guidance for the
fourth quarter to the range of $0.42 - $0.44 per share on a diluted basis,
down from previous guidance of $0.47 - $0.49. Full year guidance is now in
the range of $1.54 - $1.60 per share on a diluted basis."
Total inventory levels at the end of September were up approximately 19
percent on a per square foot basis compared to the same period last year. By
division, inventory levels on a per square foot basis were up approximately 28
percent for Ann Taylor and up approximately 2 percent for Ann Taylor Loft.
The increase at Ann Taylor was due to lower than anticipated September sales
and planned increases in in-store inventory.
During the month, the Company opened nine Ann Taylor Loft stores, one Ann
Taylor store and one Ann Taylor Factory store. In addition, one existing Ann
Taylor store was closed. The total store count at month end was 709,
comprised of 355 Ann Taylor stores, 318 Ann Taylor Loft stores and 36 Ann
Taylor Factory stores. Total square footage at the end of fiscal September
2004 increased 13.6 percent over the same period last year.
For the fiscal year-to-date period ended October 2, 2004, the Company's
net sales totaled $1,208,858,000, up 20 percent from $1,007,304,000 for the
same period in fiscal 2003. By division, net sales for the fiscal year-to-
date period were $563,990,000 for Ann Taylor compared to $553,630,000 last
year, and $538,311,000 for Ann Taylor Loft compared to $365,814,000 last year.
Comparable store sales for the fiscal year-to-date period increased 6.6
percent over the same period last year. Comparable store sales by division
for the fiscal year-to-date period were up 0.3 percent for Ann Taylor and up
17.2 percent for Ann Taylor Loft.
In September, the Company purchased 400,000 shares of its common stock at
a cost of approximately $9,700,000, bringing the total repurchased during
fiscal 2004 to 4,090,000 shares. Of the $100,000,000 securities repurchase
program approved by the Company's Board of Directors on August 10th,
approximately $63,000,000 remains.
Ann Taylor is one of the country's leading women's specialty retailers,
operating 709 stores in 45 states, the District of Columbia and Puerto Rico,
and also Online Stores at http://www.anntaylor.com and
http://www.anntaylorLOFT.com as of October 2, 2004.
Certain statements in this press release are Forward-looking statements
made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. The forward-looking statements may use the
words "expect," "anticipate," "plan," "intend," "project," "believe" and
similar expressions. These forward-looking statements reflect the Company's
current expectations concerning future events and actual results may differ
materially from current expectations or historical results. Any such forward-
looking statements are subject to various risks and uncertainties, including
failure by the Company to predict accurately client fashion preferences;
decline in the demand for merchandise offered by the Company; competitive
influences; changes in levels of store traffic or consumer spending habits;
effectiveness of the Company's brand awareness and marketing programs; general
economic conditions or a downturn in the retail industry; the inability of the
Company to locate new store sites or negotiate favorable lease terms for
additional stores or for the expansion of existing stores; lack of sufficient
consumer interest in the Company's Online Store(s); a significant change in
the regulatory environment applicable to the Company's business; risks
associated with the possible inability of the Company, particularly through
its sourcing and logistics functions, to operate within production and
delivery constraints; the impact of quotas, and the elimination thereof; an
increase in the rate of import duties or export quotas with respect to the
Company's merchandise; financial or political instability in any of the
countries in which the Company's goods are manufactured; the potential impact
of health concerns relating to severe infectious diseases, particularly on
manufacturing operations of the Company's vendors in Asia and elsewhere; acts
of war or terrorism in the United States or worldwide; work stoppages,
slowdowns or strikes; the inability of the Company to hire, retain and train
key personnel, and other factors set forth in the Company's filings with the
SEC. The Company does not assume any obligation to publicly update or revise
any forward-looking statements at any time for any reason.
SOURCE Ann Taylor