Apparel and accessories retailer Q4 sales, profit top Street

A move to a more fast-fashion model helped Francesca’s to outperform many of its peers in the fourth quarter, with sales and income that topped expectations.



The retailer reported better-than-expected profit of $14.6 million, or 39 cents a share, for the quarter ended January 28, compared to $14.7 million profit, or 35 cents a share, in the year ago period.



Revenue rose 9% to $146.3 million, which also topped the Street forecast, driven by the addition of 55 net new stores compared to the same period last year and a 42% increase in e-commerce sales fueled by increased website traffic and conversion rate.



Same-store sales were flat.



“These comp results were achieved in a challenging retail environment where we were up against an 11% comparable sales increase in the fourth quarter of last year,” said Steve Lawrence, president and CEO, Francesca’s Holdings Corp., which operated 671 stores at the end of the quarter.



Lawrence said the company worked hard to improve its inventory management and ended the year with total inventories down 24% versus the prior year.



“This decrease was driven by disciplined receipt flows during the quarter coupled with both markdowns and mark-out-of-stock charges taken at year-end to ensure a clean transition into 2017,” he said.