Sponsors
Billabong ▼ -0.020 | PPR ▲ +1.15 | American Apparel ▼ -0.036 | The Buckle ▲ +0.14 | Columbia ▼ -0.73 | Deckers Outdoor ▼ -1.21 | Dicks ▼ -0.11 | Foot Locker ▲ +0.97 | Genesco ▼ -0.58 | Iconix Brand Group ▼ -0.12 | Jarden Corp ▼ -0.05 | Nordstrom ▼ -0.20 | Luxottica ▲ +0.40 | Nike ▲ +0.24 | Pacific Sunwear ▼ -0.04 | Skullcandy ▼ 0.00 | Sport Chalet - 0 | Urban Outfitters ▲ +0.01 | VF Corp ▼ 0.00 | Quiksilver ▼ -0.02 | Zumiez ▲ +0.11 | Macys ▼ -0.01 | Tillys ▲ +0.12 |
Ticker Sponsor
Readers Say
The first thing I look at
The first thing I look at

I find Shop-Eat-Surf to be a very useful and informative site that I enjoy browsing daily. Shop-Eat-Surf is the first thing I look at every morning to keep up-to-date on the latest talk, events, and happenings in the industry. I must say I am a fan of Shop-Eat-Surf.

- By Bobby Abdel, Partner, Jack's Surfboards
Always a good daily read
Always a good daily read

Shop-Eat-Surf creates a good source of timely information about the industry. The site makes all types and size companies feel part of a community where everyone is stoked to hear about other companies successes and ideas. It is always a good daily read.

- By Ted Li, VP of North America, Oakley
Industry Insight

CURVEXPO: Recap of the swimwear & lingerie show in Las Vegas.

SIMA: Save the Date invitation for Humanitarian Fund's STOKES ME Bowl-a-rama on Sept. 16.

Details on Industry Insight.


Tiffany Montgomery
Print This Article

PSUN very pessimistic about second half

By Tiffany Montgomery
August 22, 2008 8:48 AM

Same-store sales were down 8 percent in the first two and a half weeks of August at PacSun and executives expressed great pessimism about the second half of the year during the company's second quarter conference call yesterday.


Five analysts downgraded the stock after the conference call, and the stock price was down 28 percent to $5.57 in early morning trading, well below its previous 52-week low of $7.


CEO Sally Frame Kasaks said the company faced "significant challenges" in California, Florida and the Desert Southwest, regions that account for 24 percent of PacSun's store base.


Same-store sales in those regions were down 10 percent in the second quarter. Outside of those regions, same-store sales rose 3 percent.


In light of their pessimistic view, PacSun said it is relooking at receipt flows and orders. It is also watching expenses and capital expenditures closely.


The company believes the holiday season will be very promotional and thus expects gross margins to deteriorate.


Executives had such a negative view of the third quarter, analysts on the call wondered if they were being too conservative.


CFO Michael Henry said they are 1/3 through the quarter with comps down 8 percent with tougher comp comparisons in the next week and a half. If the customer doesn't show up for back to school, there's not much of a catalyst for shopping in September or October, he said.


More information:


Q2 sales: Up slightly to $313 million vs. $312 million the previous year.


Net income: Fell to $3.7 million vs. $9.3 million for the second quarter of fiscal 2007 which was inline with expectations.


Same-store sales: Down 1 percent


Total apparel comps: Up 13 percent


Junior apparel comps: Up 26 percent. Juniors apparel now accounts for 51 percent of total apparel sales. PacSun wants to push that figure to 55 percent. PacSun-owned brands accounted for 50 percent of sales


Strong junior categories: Bullhead denim, tops and dresses.


Weak categories: Shorts and swim, though the company liquidated the inventory via promotions. That led to lower margins.


Young men's: Apparel comps increased 2 percent. Industry brands accounted for 77 percent of the mix, a percentage PacSun plans to stick with.


Strong YM categories: Bullhead denim and tops.


Weak YM categories: Swim. Shorts ended the quarter flat but the margins were not good.


Accessories comps: Down 19 percent, which the company called "disappointing." The company plans to reduce its accessory mix.


Footwear comps: Down 56 percent as the company exits footwear.


Forward view: The company expects earnings per share of 0 to 5 cents in the third quarter and 11 cents to 16 cents for the fourth quarter.

 


Articles You Might Have Missed