Press Release:
– Reports GAAP net loss of $(0.11) per share for Q3
– Comparable non-GAAP net loss of $(0.07) per share vs. prior year GAAP net loss of $(0.17) per share
ANAHEIM, Calif., Nov. 22, 2010 (GLOBE NEWSWIRE) — Pacific Sunwear of California, Inc. (Nasdaq:PSUN – News) (the “Company”) today announced that net sales for the third quarter of fiscal 2010 ended October 30, 2010, were $258 million versus net sales of $268 million for the third quarter of fiscal 2009 ended October 31, 2009. Total Company same-store sales decreased 3% during the period.
For the third quarter of fiscal 2010, the Company reported a net loss of $7 million, or $(0.11) per share, compared to a net loss of $11 million, or $(0.17) per share, for the third quarter of fiscal 2009. Results for the third quarter of fiscal 2010 reflect the continuing impact of a valuation allowance against the Company’s deferred tax assets. On a comparable non-GAAP basis, using a normalized 39% income tax rate, the Company’s net loss for the third quarter was $4 million, or $(0.07) per share.
“Our third quarter results were led by positive comps in our Men’s business and significant improvement in the sales trending of our Women’s business,” said Gary H. Schoenfeld, President and Chief Executive Officer. “We are eagerly anticipating Black Friday and the kickoff of the holiday season and the prospects for further strengthening of both our Men’s and Women’s businesses.”
Financial Outlook for the Fourth Quarter
The Company’s guidance range for the fourth quarter of fiscal 2010 contemplates a GAAP net loss per share of $(0.10) to $(0.29) for the fourth quarter of fiscal 2010 which reflects the continuing impact of maintaining a valuation allowance against deferred tax assets and a very low effective tax rate. On a non-GAAP basis, using a normalized income tax rate of approximately 37%, the Company’s guidance range translates to a net loss of $(0.07) to $(0.18) per share for the fourth quarter of fiscal 2010. The forecasted fourth quarter GAAP earnings range is based on the following significant assumptions:
Same-store sales in the range of flat to -5%;
Gross margin rate improvement of 100 to 400 basis points versus last year’s 22.6%;
SG&A expenses in the range of $82 million to $84 million;
I
ncome tax expense is expected to be minimal for the quarter because the Company no longer records income tax benefits against its operating losses.
About Pacific Sunwear of California, Inc.
Pacific Sunwear of California, Inc. and its subsidiaries (collectively, the “Company”) is a leading specialty retailer rooted in the action sports, fashion and music influences of the California lifestyle. The Company sells a combination of branded and proprietary casual apparel, accessories and footwear designed to appeal to teens and young adults. As of October 30, 2010, the Company operates 877 stores in 50 states and Puerto Rico. The Company’s website address is www.pacsun.com.
The Company will be hosting a conference call today at 4:30 pm Eastern time to review the results. A telephonic replay of the conference call will be available, beginning approximately two hours following the call, for one week and can be accessed in the United States/Canada at (800) 642-1687 or internationally at (706) 645-9291; passcode: 23412284. For those unable to listen to the live Web broadcast or utilize the call-in replay, an archived version will be available on the Company’s investor relations website through midnight, March 9, 2011.
About Non-GAAP Financial Measures
This press release and the accompanying tables include non-GAAP financial measures. For a description of these non-GAAP financial measures and reconciliations of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with Generally Accepted Accounting Principles, please see the accompanying table titled “Reconciliation of Selected GAAP Measures to Non-GAAP Measures” and the section following such table titled “About Non-GAAP Financial Measures.”
