Ascena Sales Continue To Go Backwards Or Close 275 Stores.

According to the world clothing shoes and hats net, american apparel retailers,

Brand Ann Taylor parent company

Retail Group Inc. (NASDAQ:ASNA) announced that it will close at least 275 stores after a sharp reversal in last quarter sales and huge losses.

Investors welcomed the group's restructuring decision, pushing its shares up 5.2% on Thursday.

The Ascena Retail Group Inc., which was scheduled to announce its three quarter results on Monday, said Friday that further verification of goodwill and intangible assets should be made during the period.

On Thursday, the group disclosed that the non cash pre tax impairment expenses for the previous quarter amounted to 1 billion 324 million US dollars, or 5.22 US dollars per share, which resulted in a net loss of US $15 million in the three quarter from last year to US $1 billion 30 million 700 thousand, and EPS changed from 0.08 US dollars to -5.29 US dollars.

The adjusted EPS after the write off of the impairment loss was US $0.05, which is in line with market expectations.

Robert Giammatteo, chief financial officer, stressed yesterday that the impairment loss had no effect on the operation and financial position of the group.

As of April 29th, Ascena Retail Group Inc. had cash and cash equivalents of $300 million, a year-on-year decrease of 19.3% and a total debt of $1 billion 669 million.

The same store sales in the three quarter were affected by persistent passenger flow and fell by 8%, Ann Taylor and Loft two.

The top four fashion businesses as well as the low price fashion, XXX fashion and children's wear all recorded double-digit declines.

Net sales fell 6.2% to $1 billion 565 million 100 thousand compared with the same period last year, which is in line with FactSet's consolidated forecast of $1 billion 560 million.

For the current fourth quarter, the group is expected to record an adjusted diluted earnings per share of 0.01-0.06 US dollars, and the combined Thomson Reuters I/B/E/S is expected to be $0.01.

The adjusted EPS target for the whole year is maintained at 0.10-0.15 US dollars, and the combined Thomson Reuters I/B/E/S is expected to be US $0.16.

Robert Giammatteo said the same store sales will drop by 8% this quarter.

As of April 29th, the group's inventory decreased by 3% to $714 million a year.

In October 2016, Ascena Retail Group Inc. released the cost reduction plan for "growth change", aiming to cut expenditure of $150 million. Last month, the group raised its target to 2.5-3.0 billion.

In order to achieve the new goal, CEO David Jaffe said at the post earnings analyst conference that it would close 275 stores.

As of April 29th, after closing 28 stores in the three quarter, the group had 4850 stores in the United States, Canada and Puerto Rico, and the number of stores with parity brand Maurices and teenage brand Justice was 1000.

The chief financial officer, Robert Giammatteo, said the closing of the store was entirely based on the performance of a single store. He also warned that if the group could not reach an agreement with retail owners in the next two years, the number of outlets would increase to more than 650, accounting for 13% of the total number of stores.

Analysts pointed out that the huge retail network of Ascena Retail Group Inc. is one of the chief culprits of its continued recession in such a difficult retail environment. Moreover, its brand is dull and unchangeable, which can not stimulate consumer demand.

Cowen&Co. analyst Oliver Chen said in its April research report that Ann Taylor currently has 325 stores in the United States needs to reduce the number of shops by 10%, so as to achieve a reasonable scale of 265-315 stores, and Justice, Lane Bryant and Loft three brands should also close 180, 170 and 120 stores respectively.

KeyBanc Capital Markets general manager Ed Yruma believes that Ascena Retail Group Inc. needs to consider selling some brands.

David Jaffe expressed its openness to the divestiture brand at the analyst conference.

Jim Cramer, a leading US investment expert, points out that the trouble of the group stems from the acquisition of Ann Inc. (Ann Taylor and Loft) by US $2 billion 160 million two years ago. This paction has increased the number of group stores to more than 1000 stores, and quite a separate shopping mall has gone against the trend of entity pferring to the online market.

According to Guggenheim Securities data, the group's store accounts for about 30%.

Ascena Retail Group Inc. (NASDAQ:ASNA) received $1.82 on Thursday, down 1.89% from the whole world. In the past 12 months, the stock had fallen 74.6% and its market value was less than 350 million dollars.

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