Francesca's gives weak outlook

Boutique retailer Francesca's efforts to improve same store sales achieved disappointing results in the first quarter.

The company said same-store sales declined 2% due to lower transaction count, although direct-to-consumer sales rose 19%.

“While we did see some bright spots in apparel, particularly in dresses around the Easter holiday, we believe that it will take time to achieve positive comparable results in this business. Looking ahead, we are maintaining our prior financial guidance for fiscal year 2015,” said Michael W. Barnes, chairman and CEO. “Improving comparable sales is our number one priority. We continue to be focused on maintaining the right levels and composition of inventory and taking a disciplined approach to managing promotional activity and merchandise margins.”

Net income dropped 18% to $7.24 million from $8.56 million the same period a year earlier. Net sales fared better, rising 11% to $95.01 million from $85.42 million, helped by the opening of 76 new stores in the preceding 12 months.

For the second quarter, net sales are expected to be in the range of $104 million -$107 million, assuming a mid-to-low-single-digit decrease in same-store sales. For the full fiscal year, the retailer expects net sales to be in the range of $412 million - $424 million, assuming a flat-to-low-single-digit decrease in same-store sales.