The apparel and accessories retailer
Francesca's Holding Corp
) raised its guidance for the upcoming fourth quarter ending
February 2, 2013. The upward revision came on the back of strong
sales and margin performance in the holiday season.
The company raised its earnings per share guidance to the
range of 29 cents to 30 cents from the previously announced range
of 27 cents to 28 cents. Net sales for the fourth quarter are
projected to be around $84.5 million to $85.0 million, up 37% to
38% over the comparable prior-year quarter. Net sales were guided
up from the range of $82.5 million to $83.5 million announced
during the third quarter conference call.
November same-store sales were above expectations despite the
negative effects of Hurricane Sandy, and prompted the company to
raise its guidance for the upcoming quarter.
The company's boutiques saw customer traffic during the
holiday season. Moreover, its 'broad and shallow merchandising
strategy' was a big hit.
The Zacks Consensus Estimate for the fourth quarter of 2012
increased by one cent to 29 cents per share in the past 30 days,
as 2 out of 5 estimates were raised. The current projection
implies an estimated year-over-year growth of 54.7%.
Francesca's reported third-quarter earnings of 24 cents a
share, beating the Zacks Consensus Estimate by a couple of cents
or 9.1%. Earnings more than doubled from the prior-year quarter
earnings of 11 cents. Net sales came in at $72 million, up 44%
year over year and beat the Zacks Consensus Estimate of $71
million. Comparable boutique sales improved 16.7%.
Operating income jumped 120.4% to $17.7 million. Operating
margin expanded 855 basis points to 24.6%, reflecting selling,
general and administrative expense leverage, as well as gross
margin improvement of 96 basis points to 52.6%.
The company's stores are widespread across the U.S. enabling
it to reach a large number of customers. It has also increased
focus on e-commerce, which is expected to boost revenue in the
Founded in 1999 and headquartered in Houston, Texas,
Francesca's Holdings Corporation operates a chain of retail
boutiques under the Francesca's collections brand in the United
States. It is a holding company operating through its subsidiary,
Francesca's Collections Inc.
The company targets female customers and offers a diverse and
uniquely balanced mix of high-quality, trendy apparel, jewelry,
accessories and gifts at attractive prices. Francesca's Holdings
carries a Zacks Rank #1 (Strong Buy) and competes with
) carrying a Zacks Rank #3 (Hold) and
) carrying a Zacks Rank #2 (Buy).
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