Express (EXPR) Guides Q4 EPS Below Views

In advance of its presentation at the 20th Annual ICR Conference, Express, Inc. (NYSE: EXPR), a specialty retail apparel company, today updated its outlook for the fourth quarter and full year periods ending February 3, 2018, based on its performance during the 2017 holiday season.

David Kornberg, Express, Inc.'s president and chief executive officer, commented: “The fourth quarter was off to a positive start in November and early December, however the key weeks leading up to Christmas were disappointing. Our performance during December was most challenging in our retail stores, where traffic was worse than expected. E-commerce sales quarter to date continue to trend positively, up double-digits versus last year. From a product perspective, dresses and sweaters were the primary drivers of the sales miss relative to our expectations. We have identified the product specific issues and are actively addressing them to improve future performance. On a positive note, January to date sales have stabilized, improving relative to the December trend. That said, based on our holiday performance, we are lowering our fourth quarter and full year 2017 outlook for comparable sales and EPS. While we are course correcting in some areas of the business, we are confident in our long-term initiatives and our ability to drive improved performance."

2017 Guidance:

Fourth Quarter:

Comparable sales are currently expected to be in the range of -1% to -2%. The Company expects net income to be in the range of $24.5 to $26.0 million and diluted earnings per share to be in the range of $0.31 to $0.33 on 79.2 million weighted average shares outstanding.

(Street sees Q4 EPS of $0.43)

On November 28, 2017, the Company's Board of Directors approved a new share repurchase program that authorized the Company to repurchase up to $150 million of the Company’s outstanding common stock using available cash. Under this authorization, the Company has repurchased 448,310 common shares for approximately $5.0 million and currently has $145 million remaining under its authorization. The Company’s updated fourth quarter guidance reflects such share repurchases, however does not contemplate any future share repurchases.

Full Year:

Comparable sales are expected to be -4%. Net income is expected to be in the range of $14.3 to $15.8 million, or $0.18 to $0.20 per diluted share. Adjusted net income is expected to be in the range of $26.0 to $27.5 million, or $0.33 to $0.35 per diluted share on 78.9 million shares outstanding. Adjusted net income excludes approximately $24.2 million, or $11.7 million net of tax and $0.15 per share, related to the exit of Canada.

(Street sees FY EPS of $0.46)

Consistent with past practice, this guidance excludes any additional non-core operating items that may occur and also excludes the impact of any changes in tax legislation.

The Company expects to report fourth quarter and full year 2017 results during the week of March 12, 2018.

ICR Conference:

The Company will present at the 20th Annual ICR Conference being held at the JW Marriott Orlando Grande Lakes in Orlando, Florida on Tuesday, January 9, 2018 at 4:00 p.m. Eastern Time (ET). David Kornberg, president and chief executive officer, and Perry Pericleous, senior vice president and chief financial officer, will host the presentation and Mark Rupe, vice president of investor relations, will be in attendance. The Company’s investor presentation will be posted on the Express website by 7:00 a.m. ET on January 9, 2018 and the conference presentation will be webcast live and available for replay for 90 days at www.express.com/investor.

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