Nov 26 Teen apparel retailer Tilly's Inc
forecast a much lower-than-expected profit for the
fourth quarter, citing weak customer traffic amid increased
promotions in the holiday season.
Shares of the company, which also reported
lower-than-expected quarterly revenue, fell 20 percent in
trading after the bell on Tuesday.
Retailers ranging from department store operator Macy's Inc
to apparel retailers such as Urban Outfitters are
offering huge discounts to help shift stock during what is
expected to be the toughest holiday shopping season since 2008.
Teen clothing sellers such as Abercrombie & Fitch Co
and Aeropostale Inc are discounting the most, due in
part to high unemployment rates among the young but also because
teens are spending more on high-cost items such as mobile
phones, gaming consoles and tablets.
Tilly's stores, most of which are located in California, New
York and Florida, offer brands such as Levi's and Billabong
among others and its own brands such as RSQ, Full Tilt and Blue
The company said it expects fourth-quarter earnings of 15 to
21 cents per share. Analysts' were expecting 35 cents, according
to Thomson Reuters I/B/E/S.
The Irvine, California-based company said it expects
comparable-stores sales to fall in the mid- to high-single digit
Third-quarter net income fell 34 percent to $6.1 million, or
22 cents per share, from $9.3 million, or 33 cents per share, a
Net sales fell 0.9 percent to $123.8 million, while
comparable-store sales, which include online sales, fell 2.4
percent in the quarter.
Analysts on average had expected earnings of 21 cents per
share on revenue of $132.6 million.
Tilly's sells surf and skateboard apparel, footwear,
skateboards and accessories, and operated about 189 stores as of
Tilly's shares, up 17 percent in the past year, closed at
$15.88 on the New York Stock Exchange on Tuesday.
(Reporting by Siddharth Cavale in Bangalore)