City Outfitters shares tumble on disappointing vacation gross sales, retailer faucets Harrington as CEO
Customers with their City Outfitters purchasing luggage in Soho in New York
Richard Levine | Corbis | Getty Photographs
City Outfitters shares tumbled Tuesday after the attire retailer reported disappointing vacation gross sales and introduced its present chief govt is about to depart on the finish of the month.
Its inventory dropped about 11% in after-hours buying and selling, having closed the day up practically 6%.
City Outfitters, which additionally owns the Anthropologie and Free Individuals manufacturers, mentioned present CEO Trish Donnelly will likely be leaving, efficient Jan. 31, to pursue one other profession alternative. It has named Sheila Harrington, present CEO of Free Individuals, as CEO of City Outfitters, and she’s going to proceed to supervise the Free Individuals banner.
Throughout the two-month interval ended Dec. 31, City mentioned its whole firm gross sales fell 8.4% from a 12 months earlier, whereas same-store gross sales fell 9% on account of declines in retailer site visitors due to the Covid pandemic. Similar-store gross sales observe income each on-line and at shops open for at the very least 12 months.
Its on-line gross sales grew double digits, the corporate mentioned, however that wasn’t sufficient to offset the losses in its shops. City mentioned gross sales have been up 1% at Free Individuals, down 8% at City Outfitters, and down 12% at Anthropologie.
In a digital presentation on the annual ICR Convention Tuesday afternoon, CFO Frank Conforti defined the corporate saved its inventories gentle in the course of the holidays, particularly in shops, to keep away from having to low cost extra merchandise on the season. However this technique may need backfired and hit retailer gross sales, Conforti mentioned. “This can be the primary time we skilled the destructive impression on account of our product mannequin,” he mentioned.
City can be within the technique of constructing one other warehouse facility in Kansas, he mentioned, to have the ability to meet the demand spike it’s experiencing on-line, and it’ll open a brief warehouse within the interim to assist it with digital orders.
The corporate famous its same-store gross sales throughout the portfolio have “rebounded properly” throughout January. Nonetheless, it expects income to be pressured in the course of the fourth quarter due, partly, to heightened supply and logistics bills due to the surge it’s experiencing on-line.
For the eleven-month interval ended Dec. 31, City mentioned its whole web gross sales fell 14.3%, whereas same-store gross sales dropped 12% total.
Additionally Tuesday, City named Gabrielle Conforti, its present chief merchandising officer, as president for City’s North America division. Emma Wisden, present managing director for City’s Europe division, will lead City’s wholesale enterprise, the corporate mentioned.
City Outfitters shares had climbed nearly 15% over the previous 12 months, as of Tuesday’s market shut.