Now that consumers know they can perpetually buy on promotion, many won’t pay up for full price product and brands are feeling the pinch.
In its second quarter report released Wednesday, Ascena Retail Group, parent company of Ann Taylor, Loft and Lane Bryant, reported sales dipped 4 percent to $1.748 billion for the period ended Jan. 28.
“While we remain generally pleased with selling performance during peaks, our base business remained soft due to ongoing store traffic headwinds and overall customer price sensitivity, which have become persistent issues impacting our larger sector,” Ascena Retail Group president and CEO David Jaffe said. “While our second quarter comp sales were in line with our guidance, we were forced to be much more promotional than planned to achieve this level of performance.”
Sales were down the most at Ann Taylor, falling 9 percent. Loft fared slightly better with sales sliding 2 percent and sales at Lane Bryant fell 5 percent.
The company’s operating loss totaled $45 million for the quarter compared to $17 million in the prior year period. The company attributed the increased loss to the decline in gross margin dollars in its value fashion (Maurices and Dressbarn) and kids fashion (Justice) segments. Net losses totaled $35 million or 18 cents per diluted share.
“As I reflect on our strategic position, we continue to see the disruptive trend toward ecommerce transactions, and the growing influence of online engagement on traditional brick and mortar activity across our sector,” Jaffe said. “We’ve invested heavily in our omnichannel platform over a multi-year period, and we continue to aggressively evolve our organization to embrace and serve customers in this new retailing paradigm.”
Ascena operates 4,878 store locations, including 328 Ann Taylor stores, 678 Loft stores and 1,012 Maurices locations.
A recent report by A.T. Kearney highlights the ways in which sustainability can lead to profitability, using apparel companies currently employing these tactics as case studies.Read more
Schutz is having a moment in the U.S., and the Brazilian-made footwear brand is planning to make the most of it.Read more
Walmart announced an extensive lighting program with Current, powered by GE, as part of its emissions reduction plan.Read more
Tommy Hilfiger credits his brand's staying power to tapping into the fountain of youth, whether that means teaming with Gigi Hadid or jumping on nascent AI technology.Read more
The footwear industry is providing consumers with high-tech footwear solutions, plus Adidas teamed up with Fashion for Good to accelerate environmental practices.Read more
The Bon-Ton Stores has entered into forbearance with lenders to buy more time on interest payment that was due in December.Read more