Childrens Place Posts Upbeat Q3 Profit, But Sales Miss Views

reported better-than-expected earnings for the third quarter on Tuesday. The Secaucus, New Jersey-based company reported quarterly net income of $38.5 million, or $1.88 per share, up from $36.9 million, or $1.70 per share, in the year-ago period. Excluding one-time items, the company's earnings came in $1.93 per share. Its revenue slipped 6.4 percent year-over-year to $455.9 million. However, analysts were expecting earnings of $1.92 per share on revenue of $473.34 million. The average estimate among 20 Estimize users was for earnings of $1.90 per share and revenue of $477.33 million. Comparable retail sales dropped 3.0 percent for the third quarter. Gross profit declined to $180.5 million in the third quarter, from $190.1 million in the year-earlier quarter. Operating income rose to $57.6 million from $55.8 million. Jane Elfers, President and Chief Executive Officer said, "The systems investments we have made in state of the art assortment planning, inventory allocation and replenishment tools are delivering results. Our digital initiatives continue to gain traction; we implemented a new distributed order management system in the third quarter which is a key component of our omni-channel strategy. Our fleet rationalization initiative is on track and we expect to close 200 stores through 2017. Our wholesale and international businesses continue to expand; we recently announced a new partnership with El Palacio de Hierro to open free-standing stores and shop in shops in Mexico, with the first successful opening occurring last month." For the current quarter, Childrens Place projects earnings of $0.93 to $1.03 per share, versus analysts' estimates of $0.99 per share. The company reaffirmed its earnings forecast for the full year. The company's board also announced a $250 million buyback program. Childrens Place shares fell 3.69 percent to close at $48.76 yesterday.