Pacific Sunwear shares drop on 3Q loss

AP News
Posted: Nov 16, 2009 4:47 PM

Shares of Pacific Sunwear of California Inc. plunged after-hours Monday as the teen clothing retailer reported a larger third-quarter loss and predicted a weak fourth quarter.

Pacific Sunwear said it lost $10.9 million, or 17 cents per share, in the quarter that ended Oct. 31. That compares with a loss of $2.5 million, or 4 cents per share, a year earlier.

Revenue fell 17 percent to $268.3 million from $323.6 million. Sales at stores open at least a year fell 18 percent during the quarter. Sales at stores open at least a year are a key measure of retailer performance because they measure growth at existing stores rather than from newly opened ones.

The results topped estimates of analysts polled by Thomson Reuters, who had expected a loss of 20 cents per share on sales of $260.1 million. However, PacSun forecast a fourth-quarter loss of 28 cents to 35 cents per share in the fourth quarter, hurt by $5 million in write-downs. It also expects sales at stores open at least a year to fall in by at least 20 percent.

The company said that through most of the third quarter, business performed at the higher end of internal forecasts led by improved trends in its young men's business. However, since then PacSun has seen a "precipitous decline across both genders."

Analysts have been expecting a smaller fourth-quarter loss of 11 cents per share, excluding one-time items.

Shares fell 94 cents, or 19 percent, to $4.15 in aftermarket trading after closing earlier up 5 percent at $5.01.