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Charming Shoppes Expects Fiscal 1Q Loss

The Associated Press

BENSALEM, Pa. (AP) — Women's apparel retailer Charming Shoppes Inc. on Wednesday it will likely report a loss in its first quarter due to an expected double-digit decline in same-store sales.

The owner of the Lane Bryant, Fashion Bug and Catherine's chains said it expects to report a loss between 9 cents per share and 13 cents per share including special items — or a loss of between 3 cents per share and 7 cents per share excluding charges and gains — in the period.

Analysts polled by Thomson Reuters anticipate a loss of 6 cents per share for the period. Analyst estimates typically exclude one-time charges and gains.

In the 2008 first quarter, the company had a loss from continuing operations of a penny per share including special items.

The retailer said it anticipates revenue between $535 million to $545 million, compared with sales of $641 million in last year's first quarter.

Charming Shoppes said it expects consolidated same-store sales, or sales at stores open at least a year, to drop by low double-digits.

The company said it will work to reduce its inventories and lower its capital expenditures for the fiscal year to about $24 million — a 50 percent cut from the $48 million the company spent in 2008.

The retailer also said it will open about 6 Lane Bryant stores in fiscal 2009 and will relocate 12 stores. Charming Shoppes has also previously said it will close about 100 stores during the year. It also cut 225 jobs, or about 2 percent, of its work force, in January after posting weak holiday sales.

The company's cost-cutting initiatives also include the closure of Figure Magazine, effective immediately, and the closing of the shoetrader.com website in the second half of the year.

The company said it expects to realize cost savings of about $125 million during the current fiscal year.

Chairman Alan Rosskamm, who also serves as interim chief executive, said brand leaders are now also developing merchandising and marketing programs designed to bring in their target customers.

Charming Shoppes added that its $50 million credit card securitization facility has been renewed through March 30, 2010.

The company also on Wednesday reported a wider loss for continuing operations in its fiscal fourth quarter.

Shares of Charming Shoppes shed 3 cents to $1.16 in morning trading.