UPDATE: Lands' End Posts Higher Q3 Profit, But Sales Miss View

Lands' End

reported a rise in its earnings for the third quarter. However, the company's sales missed analysts' estimates. The Dodgeville, Wisconsin-based company posted a quarterly profit of $18 million, or $0.56 per share, versus a year-ago profit of $14.3 million, or $0.45 per share. Its revenue declined 2.8% to $373.1 million, while same-store sales dipped 3.1%. However, analysts were expecting earnings of $0.40 per share on revenue of $404.14 million. As of October 31, Lands' End operated 242 Lands' End Shops at Sears and 14 global Lands' End Inlet stores, compared to 275 Lands' End Shops at Sears and 16 global Lands' End Inlets, on November 1, 2013. Lands' End revenue in the direct business dropped 1.2% to $320.3 million. Net merchandise sales in the retail segment shrank 11.5% to $52.8 million. Operating income rose 50.8% to $35.1 million, while adjusted EBITDA climbed 39.9% to $39.9 million. Gross margin expanded to 49.1% from 45.4%, while total expenses shrank 6.3%. On October 31, 2014, cash was $105.6 million, versus $16.3 million on November 1, 2013. Inventory slipped 12.9% to $403.9 million on October 31, 2014, compared to $464.0 million on November 1, 2013. Edgar Huber, Lands' End's President and Chief Executive Officer, said, "We delivered another quarter of strong operating margin increases driven by a better assortment of product, a more targeted promotional strategy and disciplined expense controls. Profitable growth and price integrity are critical components of the Lands' End's brand strategy and this represents the sixth consecutive quarter in which we have delivered better than 20% growth in operating income.” Lands' End shares declined 5.40% to $48.00 in pre-market trading.