The Children's Place Inc.(NASDAQ:PLCE) reported first-quarter results that outpaced Street expectations Wednesday morning, but shares fell nonetheless as US retail sales data disappointed.
The retailer saw adjusted earnings fall to $0.36 per share from $1.78 in the year ago quarter, easily outpacing analyst expectations of a $0.49 per share loss. Revenue fell 5.5% to $412.4 million, compared with Street estimates of $399 million.
Net income dropped to $4.5 million from $31.5 million year over year.
The surprsie results came as the company liquidated 800 Gymboree and Crazy 8 stores in the quarter, which overlapped with 70% of Children’s Place stores.
After surging in pre-market trading, shares crashed back to earth, dropping 8.3% to $102.79.
READ: The Children's Place shares sink after retailer misses Street's fiscal 4Q estimates and and announces purchase of Gymboree assets
One reason for the decline could be lagging US retail sales data. According to data from the Census Bureau released Wednesday morning, retail sales reversed course in April, dropping 0.2% after a 1.7% increase in March. Analysts had called for growth of 0.2%.
Looking ahead, the New Jersey company second quarter EPS between flat and $0.20 on revenue between $415 million and $420 million. Analysts are calling for $0.10 EPS on revenue of $420.4 million.
For fiscal 2019, it expects between $5.75 and $6.25 EPS on revenue between $1.91 billion and $1.93 billion, while Street expectations are $5.60 EPS on revenue of $1.91 billion.
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