Ann ANN fell sharply in pre-market action Thursday, after the company warned that it will post a 2.3 percent decline in same-store sales for its second quarter ended July 14.
Total net sales grew $648 million, up 12.7 percent from $574.5 million a year earlier. Previously, the company forecast sales of $670 million, while Wall Street expected $672.4 million.
Ann is slated to post full results August 22.
Chief executive Kay Krill said comps had been positive through mid-June, but the remainder of the quarter saw soft traffic and heavy discounting across the industry.
"We took action to move through summer product, which pressured gross margin but enabled us to end the quarter with clean inventories," Krill said.
Same-store sales rose 0.7 percent at Ann Taylor stores and fell 4.1 percent at Loft brand stores.
Basic knit tops, an important component of Loft's summer assortment, saw continued weakness.
Ann changed hands recently down 10.8 percent at $4.14 per share.
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