Children's Place Inc. (PLCE - Get Report) stock sunk more than 10% iMonday after reporting-fourth quarter earnings and sales misses and giving disappointing full-year guidance.

The children's apparel retailer said it faces "unprecedented challenges" caused by the liquidation of its direct competitor, Gymboree Group Inc., which owns more 1,200 U.S. stores. Children's Place also announced it was taking over Gymboree and Crazy 8 brands to the tune of $76 million.

Fourth-quarter net income came in at $12 million, or 74 cents a share, compared to a loss of $9.9 million, or 57 cents a share, in the same period the prior year. Adjusted EPS was $1.10, missing analysts' consensus of $2.10.

Net sales for the quarter declined 6.9% to $530 million, missing estimates of $553 million. Same-store sales fell 0.6%, missing expectations of an increase of 2.7%.

Full-year guidance for 2019 was a big miss. The company said it expects adjusted EPS between $5.25 to $5.75, while analysts surveyed by FactSet were expecting $8.84. Net sales are expected between $1.89 billion to $1.92 billion vs. consensus of $2 billion, with same-store sales to be flat to down 1%. Analysts were expecting 3.7% growth in same-store sales.

President and CEO of Children's Place, Jane Elfers, said in a statement the company experienced unprecedented challenges due to the total liquidation of direct competitor Gymboree. Because Children's Place overlaps nearly 70% with Gymboree and Crazy 8 kids' retail and fashion stores, Elfers said the company will now have to compete with liquidation sales in the next 60 days.

"We have never experienced a total liquidation of a direct competitor of the size and proximity of Gymboree," Elfers said. "Additionally, we are challenged by a very late Easter. Taken together, these create unprecedented near-term visibility challenges, and, as a result, the first half of 2019 is anticipated to be a highly disruptive time for The Children's Place."

In addition to competing with liquidation sales, Children's Place won the rights to the Gymboree Group and Crazy 8 brands in a bankruptcy auction. The company will pay $76 million for the two brands and take over an agreement with Zeavion Holding Co., the holding company that acquired Gymboree's Play & Music business in 2016. 

Children's Place stock has fallen 38.9% in the last 12 months while the S&P 500 gained 3.3%.