All prior year comparable sales results have been adjusted to reflect this change.
The company reiterated its third quarter earnings guidance of earnings per share in the range of $0.08 to $0.10. The company also stated the previously announced fourth quarter earnings guidance (14 weeks ending February 2, 2013) remains the same, in the range of $0.23 to $0.27 per share, as compared to earnings per share of $0.21 last year. This guidance is based upon a comp sales increase in the low to mid-single-digit percentage range.
Lisa Harper, Chairman of the Board and CEO, said, “We are happy to report our strategy of moving to a vertical sourcing model at Torrid has resulted in very strong gross margins and regular price selling, which validates our continued investment in the brand’s growth. At Hot Topic, we are pleased with the progress in the fashion apparel and tee businesses while still having challenges in the accessory categories. However, the combination of gross margin improvements in both brands has positioned us to achieve a strong earnings increase over last year and maintain our guidance on what was essentially a flat comp.”
The company announced its board of directors authorized an increase to the company’s stock repurchase program, up to $25 million of the company’s common stock. Repurchases will be made in accordance with applicable securities laws from time to time in open market or private transactions, depending on market conditions, and may be discontinued at any time. There can be no assurances as to the number of shares the company will repurchase, if any.Hot Topic, Inc. also announced it will launch a test retail concept – Blackheart. The concept will test the viability of leveraging the existing Hot Topic customer base by offering an expanded collection of dark, edgy, sexy lingerie. Blackheart lingerie, accessories and beauty products will be available at www.blackheartlingerie.com starting on November 15 th . Five stores will open in Southern California and Texas malls by mid November. You can also find Blackheart on Facebook, Twitter, YouTube and Instagram (@Blackheart). Ms. Harper continued, “The Blackheart lingerie concept is a test that allows us to leverage the Hot Topic customer and offer her product categories that will not cannibalize the core Hot Topic brand. We have a great opportunity to aggressively cross-promote Blackheart to our 5 million active database customers, nearly 5 million Facebook fans and in our 620 Hot Topic stores.”