Anaheim-based mall retailer Pacific Sunwear of California Inc. reported quarterly earnings that met expectations but shares fell more than 20% in afterhours trading after the company warned about the next two quarters.
Weak economic conditions tempered the retailer’s outlook for the next six months, according to Pacific Sunwear executives.
“With the possibility of an even tougher environment ahead, we plan to maintain strong operating discipline while weathering these economic headwinds in order to position our business for success when the environment improves,” Chief Executive Sally Frame Kasaks said in a statement.
For the current quarter through October, Pacific Sunwear expects to break even or make up to $3.3 million.
Wall Street had been hoping for a much bigger profit of $15.3 million.
The company didn’t give a sales outlook.
For the next quarter through January, Pacific Sunwear forecast profits of $7.3 million to $10.6 million.
Wall Street had been expecting a profit of $24 million for the three months through January.
The outlook came after Pacific Sunwear reported results for the three months through Aug. 2.
Profits came in at $4 million, down by half from a year earlier but in line with expectations.
Sales came in at $312.7 million, flat from a year earlier and up from the $309.7 million Wall Street expected.
Pacific Sunwear, which counts a market value of about $535 million, runs 938 PacSun mall and outlet stores that sell clothes inspired by surfing and skateboarding.
The company is restructuring as it weathers the tough retail market. Earlier this year it closed a chain of stores selling urban-style clothes and a small shoe store chain.
