City Outfitters shares tumbled Tuesday after the attire retailer reported disappointing vacation gross sales and introduced its present chief government is about to depart on the finish of the month.
Its inventory dropped about 11% in after-hours buying and selling, having closed the day up practically 6%.
City Outfitters, which additionally owns the Anthropologie and Free Individuals manufacturers, stated present CEO Trish Donnelly will probably be leaving, efficient Jan. 31, to pursue one other profession alternative. It has named Sheila Harrington, present CEO of Free Individuals, as CEO of City Outfitters, and she is going to proceed to supervise the Free Individuals banner.
In the course of the two-month interval ended Dec. 31, City stated its whole firm gross sales fell 8.4% from a yr earlier, whereas same-store gross sales fell 9% because of declines in retailer visitors due to the Covid pandemic. Similar-store gross sales observe income each on-line and at shops open for at the very least 12 months.
Its on-line gross sales grew double digits, the corporate stated, however that wasn’t sufficient to offset the losses in its shops. City stated gross sales have been up 1% at Free Individuals, down 8% at City Outfitters, and down 12% at Anthropologie.
In a digital presentation on the annual ICR Convention Tuesday afternoon, CFO Frank Conforti defined the corporate stored its inventories mild throughout the holidays, particularly in shops, to keep away from having to low cost extra merchandise on the season. However this technique might need backfired and hit retailer gross sales, Conforti stated. “This can be the primary time we skilled the destructive affect because of our product mannequin,” he stated.
City can also be within the means of constructing one other warehouse facility in Kansas, he stated, to have the ability to meet the demand spike it’s experiencing on-line, and it’ll open a brief warehouse within the interim to assist it with digital orders.
The corporate famous its same-store gross sales throughout the portfolio have “rebounded properly” throughout January. Nevertheless, it expects earnings to be pressured throughout the fourth quarter due, partly, to heightened supply and logistics bills due to the surge it’s experiencing on-line.
For the eleven-month interval ended Dec. 31, City stated its whole internet gross sales fell 14.3%, whereas same-store gross sales dropped 12% total.
Additionally Tuesday, City named Gabrielle Conforti, its present chief merchandising officer, as president for City’s North America division. Emma Wisden, present managing director for City’s Europe division, will lead City’s wholesale enterprise, the corporate stated.
City Outfitters shares had climbed nearly 15% over the previous 12 months, as of Tuesday’s market shut.