Francesca’s Q1 profit drops amid costs; will open 80-85 new stores

Houston – Increased selling, general and administrative expenses (SG&A) led to net income at Francesca’s Holdings Corp. dropping 18% to $7.24 million in the first quarter of fiscal 2015 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.



Same-store sales declined 2% due to lower transaction count, although direct-to-consumer sales rose 19%.



“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.”



"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.