(Filed Under Financial and General Interest News). Despite Destination Maternity Corp.’s 9.2 percent increase in third-quarter earnings, shares fell 9.5 percent as the company reduced its full-year guidance.
Net income increased to $9.5 million, or 72 cents a share, up from $8.7 million, or 67 cents a share, in the prior year’s period. Net sales for the third quarter increased 3.3 percent to $146.7 million from $142 million. Gross margin fell from 56.1 percent to 55.2 percent.
Destination Maternity lowered its full-year earnings forecast to $1.85 to $1.95 a share, down from the prior range of $2.03 to $2.22. The company cited lower comparable store sales, which fell 1.6 percent, as well as an increase in promotions as reasons for lowering the guidance.
"Given the continued uncertainty as to the timing and extent of a recovery in consumer spending, we continue to plan our sales and inventory conservatively," stated Ed Krell, chief executive of Destination Maternity.
Destination Maternity Corp. is based in Philadelphia and is currently operating 2,360 retail locations, including A Pea in the Pod and Motherhood Maternity stores. The company has an additional 1,697 leased maternity spaces in department stores, including Macy’s.
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