Container Store Shares Selling Off on Weak Q1

Shares of the Container Store Group TCS are trading lower in Tuesday’s afterhours session following worse than expected first quarter results.

Revenue for the quarter was 173.4 million versus the 174.2 million analyst consensus. This is an 8.6 percent increase over the same period last year. Same store sales dropped 0.8 percent year over year.

Earnings for the quarter were almost 17 percent worse than expected at a $0.07 loss per share. Net income was negative 27 million last year compared to a 3.6 million loss this year.

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CEO Kip Tindell commented on the quarter, “We thought our sluggish sales were all because of weather and calendar shifts that began last November and continued into the spring, but now we’ve come to realize it’s more than weather and calendar. Consistent with so many of our fellow retailers, we are experiencing a retail ‘funk’. Our comparable store sales declined 0.8%, in the first quarter.”

Guidance was also worse than expected. Container Store expects full year 2014 earnings in the range of $0.49 to $0.54 while analysts expected $0.57. Revenue is expected in the range of $820 million to $830 million. This comares to the $827 million to $837 million range previously given.

Shares Container Store Group are down 12.3 percent in extended hours trading to $23.75.