Lands' End shares rally after mixed Q1, guidance cut
02/06/2022 16:13
(Updates prices, adds details)
** Shares of casual clothing retailer Lands’ End Inc LE.O
rallied on Wednesday up 12.2% after falling more than 11% in
premarket trading even after the company reported a fiscal Q1
revenue that was below its target range and cut its full year
guidance although its loss was in line with expectations
** Reported Q1 net rev of $303.7 mln missed co's target
range of $320mln-$335mln but Q1 net loss of $2.4 mln or loss per
diluted share of $0.07 was in line with co target of $2mln-$4mln
loss and per share loss of $0.06-$0.12 set in March urn:newsml:reuters.com:*:nGNE7nJ176
urn:newsml:reuters.com:*:nGNX4zMVW8 urn:newsml:reuters.com:*:nGNX1JwLR9
** However the co did forecast a sequential revenue increase
for Q2 with a target range of $335mln-$350mln but sees its net
loss widening to a range of $0.09-$0.18/diluted share
** Says it expects ongoing pressures including supply chain
delays and consumer inflation to impact business for the
remainder of the year
** Co also cut its FY 2022 target range for revenue to
$1.62bln-$1.68bln from $1.68bln-$1.75bln range announced in
March. It forecast FY net income of $0.60-$0.88/shr compared
with previous target range of $$0.71-$1.04
** Says guidance assumes gross margin pressure begins
abating in second half
** Still, it also assumes ~$13 mln of incremental
transportation expenses in Q2 due to global supply chain
challenges and $35 mln incremental expenses on a full-year
basis. In comparison the March guidance had called for $15mln
incremental FY expenses
** But the company said it is still sticking by long-term
outlook targets provided in January
** YTD stock down ~38% including a 16.6% drop in May,
Thursday's trading price of $12.50 compares with price targets
of $15 and $29 from the two analysts who cover the company with
both rating the stock 'hold,' as per Refinitiv
(Reporting by Rithika Krishna in Bengaluru, Sinéad Carew in New
York)
((Sinead.carew@thomsonreuters.com;
Rithika.Krishna@thomsonreuters.com; Twitter: https://twitter.com/rithika_krishna;))