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See "What's Ahead"
Earnings Preview: AnnTaylor Stores Corp.
Thursday May 18, 11:06 am ET
AnnTaylor Stores Corp. Seen Posting Higher 1Q Profit on Strong Sales Growth
NEW YORK (AP) -- AnnTaylor Stores Corp. reports earnings for the fiscal first quarter on Friday before the market opens. The following is a summary of key developments and analyst opinion related to the period.
OVERVIEW: AnnTaylor operates the upscale women's clothing chains Ann Taylor, Ann Taylor Loft and Ann Taylor Factory. The company operates over 800 stores nationwide.
Over the past quarter, AnnTaylor reported sales in stores open at least one year -- a closely watched performance gauge called same-store sales -- jumped 10.9 percent in April, rose 0.8 percent in March, and increased 5.6 percent in February.
The company has seen some executive turnover recently. This month chief operating officer Laura A. Weil resigned less than a year into the job.
BY THE NUMBERS: AnnTaylor in March projected fiscal 2006 earnings between $1.60 and $1.65 per share, including stock options expense. Excluding stock options expense, it forecast earnings on an operating basis from $1.66 to $1.71 per share, versus the $1.26 per share on an operating basis it reported in 2005.
Wall Street expects profit of 40 cents per share, the average estimate of 15 analysts surveyed by Thomson Financial, on projected sales of $542.8 million.
ANALYST TAKE: "We're clearly disappointed to see Laura Weil's abrupt departure from AnnTaylor, however business trends at both businesses are clearly strong, particularly with strong results at the previously underperforming Loft division," Bank of America wrote in a May 4 client note.
"We remain selective on the (retail) group and focus on companies that are executing well, offering customers differentiated concepts, or are in the earlier part of their cycle stories," the bank added. Bank of America has a "Buy" rating on Ann Taylor and $42 price target.
WHAT'S AHEAD: Higher gas prices, rising interest rates and a slowing housing market could dent spending on clothes and other discretionary items. Inflationary pressures on wages and energy could also spur higher operating expenses.
STOCK PERFORMANCE: AnnTaylor hit a 52-week intraday high of $39.88 on May 3 and is up about 7 percent so far this year, on a dividend-adjusted basis. Shares trade around $37 on the New York Stock Exchange. |
