Earnings in Focus: Lands’ End, Inc. (NASDAQ:LE)

Lands’ End, Inc. (NASDAQ:LE) reported earnings for the three months ended April 2016 on June 01, 2016. The company earned $-0.18 per share on revenue of $273.43M. Analysts had been modeling earning per share of $0.02 with $293.24M in revenue.

Lands’ End, Inc. (NASDAQ:LE) announced financial results for the first quarter ended April 29, 2016.

First Quarter Fiscal 2016 Highlights:

  • Net revenue was $273.4 million as compared to $299.4 million in the first quarter last year. Direct segment net revenue decreased 8.4% to $232.2 million. Retail segment net revenue decreased 10.4% to $41.2 million primarily driven by a 7.1% decrease in same store sales and a reduction in the number of Lands’ End Shops at Sears.
  • Gross margin was 47.4% as compared to 49.0% in the first quarter last year due to deeper promotions as compared to last year in response to a difficult retail environment.
  • Net loss was $5.8 million, or $0.18 per share, as compared to net income of $1.7 million, or $0.05 per diluted share, in the first quarter last year.
  • Adjusted EBITDA1 was $0.6 million compared to $13.1 million in the first quarter of fiscal 2015.

Federica Marchionni, Lands’ End’s Chief Executive Officer, stated, “We continued to make progress across a number of initiatives; we remained focused on strengthening our core business and launching additional collections that we believe will drive future profitable growth. While we are encouraged by the initial wins, our financial results in the first quarter were impacted by the overall weakness in the retail environment, including aggressive discounting and promotional activity.  That said, during the quarter, we further executed our strategy by strengthening our traditional product categories and launching the Canvas by Lands’ End collection. We also enhanced our brand image, including elevated marketing initiatives, the newly-launched multi-brand e-commerce website and refinements to our catalog strategy.  We continued to receive positive response from both existing and lapsed customers on our new product offering, marketing programs, and website enhancements, and while we expect the retail environment will be very challenging, we will remain focused on building on this momentum with sequential improvement beginning in the second quarter of fiscal 2016.”

Lands’ End, Inc. earnings per share showed a decreasing trend of -126.5% for the current fiscal year. The company’s expected EPS growth rate for next fiscal year is 115%.Analysts project EPS growth over the next 5 years at 20%. It has EPS annual decline over the past 5 fiscal years of -17.9% when sales declined -2. It reported -8.7% sales drop, and -434.7% EPS decline in the last quarter.

The stock is trading at $16.82, up 8.59% from 52-week low of $15.49. The stock trades down -42% from its peak of $29 and 27.82% above the consensus price target of $21.5. Its volume clocked up at 0.13 million shares which is lower than the average volume of 0.25 million shares. Its market capitalization currently stands at $536.81M.

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