Secaucus, N.J. -- The Children’s Place Retail Stores Thursday reported lower profit for the fourth-quarter amid intense promotions and severe storms. The retailer also said it is renaming the company.
Net earnings in the fourth quarter, ended Feb.1, fell 18% to $15.7 million, from $19.1 million in the year-ago period, which had an extra week.
Net sales in the quarter totaled $467.5 million, down from $509.2 million in the year-ago period. Same-store sales declined 4.3%.
The company cited heavy promotions and bad weather as impacting its fourth quarter earnings, and also attributed its general declining performance to factors including the 53rd week in fiscal 2012. Other factors included store impairment charges related to the continued review of underperforming stores and early closure expenses.
For the full year, Children’s Place had net sales of $1.7 billion, compared to $1.8 billion last year. Same-store sales fell 2.8%.
Net income was $53.0 million, compared to $63.2 million for the previous year.
“The Children's Place delivered fiscal 2013 earnings near the top end of our guidance range despite an intensely promotional environment and a series of storms brought on by the polar vortex in the fourth quarter," said Jane Elfers, president and CEO. "2013 was a challenging year but we demonstrated our ability to deliver solid financial results through a combination of superior value, tight expense discipline, strong merchandise offerings that resonated with our customers and well-controlled inventories."
In 2014, the company plans to open approximately 35 stores and close 30 existing locations. Children’s Place also plans to double its international store count to about 65-70 locations, as well as close a total of 125 underperforming stores through 2016, including 41 stores, which were closed in 2013. Other plans include increasing its e-commerce business and completing the rollout of a North American ERP system.
In addition, Children’s Place will change its name from 'The Children's Place Retail Stores, Inc.' to 'The Children's Place, Inc.' to better reflect its strategic positioning as a global children's brand. Other news includes the board of directors authorizing a new share repurchase program in the amount of $100 million.
Looking ahead, Children’s Place is forecasting first quarter same-store sales will decline 2% to 4% and range from flat to a 1% decline in the fiscal year.