Wet Seal Sales Rise Less Than ExpectedSunday, June 5, 2011
Foothill Ranch-based mall retailer Wet Seal Inc. reported a rise in May sales last week but fell short of the gain analysts were looking for.
Same-store sales at Wet Seal, which runs 538 stores selling clothes for teen girls and young women, rose 2.9% last month.
That was short of the 3.5% gain Wall Street was expecting for stores open at least a year.
The company’s Wet Seal chain for teen girls saw a 2.8% rise in same-store sales for the month.
Arden B. stores for young women saw sales grow 3.2%.
The company runs 456 Wet Seal stores and 82 Arden B. stores.
May’s sales gain marked a tempering from April, when same-store sales rose 7%.
Wet Seal’s total May sales, including stores open less than a year, rose 10.6% to $44.5 million.
May same-store sales were impacted by fewer online promotions and less discounting, according to Chief Executive Susan McGalla.
McGalla, a former American Eagle Outfitters Inc. executive, joined the company in January.
She’s scaled back plans for opening stores as she looks to bolster sales at existing ones.
Last month, Wet Seal warned of a lower profit for the three months through July as it increases spending on marketing initiatives in a bid to boost sales.
The company said it expects a profit of $1 million to $2 million for the current quarter, versus the $3 million Wall Street analysts had been expecting on average.
Wet Seal forecast revenue of $145 million to $147 million for the quarter, roughly in line with the $147 million analysts are expecting.