By Poroma Pant
Retailer Express Inc., citing the help from a series of successful celebrity endorser campaigns, turned in fourth-quarter earnings Wednesday that modestly beat analyst estimates.
For the quarter ended Jan 30, the Ohio-based apparel chain reported net earnings of $56.1 million, or 67 cents per share compared to $41.8 million, or 49 cents per share in the year ago quarter. The latest quarter’s results beat by two pennies analysts’ estimate of 65 cents per share.
Sales climbed 5 percent to $765.6 million from $ 725.8 million in the year-ago quarter.
Express Inc. Stock Price 2015-2016
“2015 was a transformative and successful year,” said David Kornberg, chief executive officer, in a statement.
The effect of what the company described as improved product and more-positive customer experiences, Express said, were apparent in its comparable sales, or sales at stores open at least twelve months, which increased by a robust 4 percent. Express said its E-commerce sales rose 8 percent to $156.3 million this quarter.
FBR & Co. noted in a report that these figures were primarily driven due to carefully managed promotions and inventory levels and product quality.
Over the past few quarters Express has benefited from promotions featuring a number of celebrities. Just last week, the company announced that Chicago Cubs’ all-star Kris Bryant would join its roster of high-profile “brand ambassadors” including NBA MVP Stephen Curry and supermodel Kate Upton.
The fashion retailer markets its clothing to customers in the twenty to thirty-year age range, and operates more than 650 retail and factory outlet stores in Canada, Puerto Rico, and the United States.
Like industry rivals such as American Apparel and Urban Outfitters, Express has faced headwinds in the form of changing consumer trends, resulting in stagnant growth.
However, Kornberg said in a conference call that the 2015 new “360” approach to marketing, which involves partnering with key influencers has had a positive impact on brand visibility and sales.
“Consumers are responding favorably to our Spring product. We expect the positive momentum from last year to continue and, as indicated by our guidance, are optimistic about 2016,” he added.
For the fiscal year ended Jan 30 2016, net earnings were $116.5 million or $1.38 per diluted share, a significant increase from $68.3 million, or 81 cents per share in last year’s quarter. Revenue for the full year increased to $2.35 billion from $2.16 billion, the previous year.
Express’ fourth-quarter performance cheered investors: in mid-day Nasdaq trading Wednesday, the company’s shares were up 81 cents, or 4.3 percent, at $19.85.