Specialty apparel retailer The Children's Place Retail Stores, Inc. (PLCE) Thursday, reported an increase in both net and comparable retail sales for the month of September 2009.
The Secaucus, New Jersey-based company's net sales for the month rose 9% to $174.7 million from $160.7 million in the same month last year.
During the month, comparable store sales was up 2% in the U.S. and fell 1% in Canada, while online sales surged 54%. Comparable retail sales for the five-week period, including online sales, was up 4% compared to a 1% increase in September 2008. In September 2009, Children's Place opened a new store.
Previously, for the month of August, the company had posted net sales of $138.7 million as against $145.1 million in the 2008-year period, and comparable retail sales, including online sales, were reported to be down 8%. Comparable store sales slipped 10% in the US and fell 11% in Canada, while online sales rose 44% in August 2009.
Net sales for the year-to-date period slipped to $1.03 billion from $1.04 billion in the corresponding period prior year. Children's Place's comparable retail sales fell 3% as against an increase of 6% in the year-ago period.
In addition to this, the company also announced of its intentions to automate portions of its e-commerce fulfillment operations in its Fort Payne, Alabama located distribution center. Children's Place expects the total implementation cost to be $20 million, with nearly one-third of the capital expenditure anticipated to be incurred during fiscal 2009 and the remaining two-thirds estimated to be incurred in the first half of fiscal 2010.
The company foresees to finalize the implementation and commence the utilization of automated distribution system during the second quarter of fiscal 2010.
For the second quarter, Children's Place reported a net loss of $7.05 million compared to a net earnings of $11 thousand in the last-year period. On a per share basis, net loss was $0.24, compared to a breakeven in the prior year. Net sales for the period dipped 7% to $315.67 million from $338.03 million in the second quarter of fiscal 2008. Analysts expected the company to report a loss of $0.44 per share on revenues of $315.38 million.
Recently, Children's Place exited its operations of Disney Store business, which it had operated since November 2004. The business consisted of all Disney Stores in the US and Canada, certain Disney Outlet stores and 2 flagship stores. Other flagship stores and stores located on Disney Properties were not part of the operation.
The company's mall-based competitors include GapKids, babyGap, Old Navy, Gymboree Stores, Crazy 8, and Janie and Jack. Children's Place's new shoe-store in the store concept also faces competition with shoe retailers like Payless and Stride Rite.
The company currently owns and operates 906 stores and also has an online sales presence.
PLCE is currently trading at $32.97 per share, up 3.97%, on the Nasdaq.
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