Express posts disappointing earnings

Shares of Express fell by more than 10 percent Wednesday after the Columbus-based retailer posted disappointing fourth-quarter earnings.

Sales during the quarter fell to $628.4 million from $699.7 million during the same quarter a year before. Wall Street analysts had expected sales of $629.6 million for the quarter.

Express reported a fourthquarter loss of $1.09 million, a loss of 2 cents per share, down from net income of $27.4 million, or 35 cents a share, during the same quarter in the previous year. Excluding costs related to the departure of CEO David Kornberg, who left the company at the end of January, and a non-cash impairment charge related to an equity investment, the company said it earned 19 cents a share, which was actually better than Wall Street expectations of 15 cents per share.

Comparable store sales, a key indicator of a retailer’s health, decreased 6 percent.

While the fourth-quarter results were in line with the forecast Express provided in November, “our overall performance in the period was disappointing,” said Matthew Moellering, the company’s chief operating officer currently serving as interim CEO and president, during a conference call with analysts.

For the full year, sales decreased to $2.1 billion from $2.2 billion the previous year. Sales in 2017 benefited from an extra week, which was worth $26 million.

Comparable store sales for the year, including e-commerce sales, decreased 1 percent. E-commerce sales increased to $609 million from $509 million in 2017.

Net income for the year was $9.6 million, or 13 cents per share, down from $18.9 million, or 24 cents per share.

As Express continues in its search for a new CEO, the company expects its results “to remain challenging in the near-term,” Moellering said. Because of the search, Express did not provide a prediction for full-year results in 2019, confining its predictions to the first quarter.

In the CEO search, “the board is making good progress,” Mylle Mangum, chairwoman of the board, said in a statement. “We are pleased with the quality of the candidates that have shown interest and we are actively interviewing multiple individuals. This is a very attractive role that provides the new CEO ample strategic flexibility given the company’s strong brand and solid financial position.”

Mangum said the board is confident that it will hire a new CEO “in the near future.”