Benefiting from robust demand at its Loft stores, Ann Inc. (ANN) posted a stronger-than-expected 16% increase in second quarter profit on Friday, but narrowed its full-year revenue outlook.
The New York-based women’s fashion retailer also approved of a new $250 million stock buyback after it completed an earlier $600 million one last quarter.
Ann reported net income of $35.6 million, or 76 cents a share, compared with a year-earlier profit of $30.7 million, or 63 cents. The results topped average analyst estimates of 65 cents in a Thomson Reuters poll.
Sales for the three-month period were $638.2 million, up 7% from $594.9 million a year ago, mostly in line with the $639 million predicated on the Street.
Revenue at the Loft brand exceeded sales at its Ann Taylor stores, reaching $393 million, while same-store sales, a key growth metric for retailers measuring sales at stores open longer than a year, increased 2.8%.
“I am especially pleased to report that both Ann Taylor and LOFT achieved positive comparable sales and strong profitability in a highly challenging and competitive environment,” Ann CEO Kay Krill said in a statement. "Looking ahead, both brands are well-positioned to drive top-line growth and strong profitability in the second half of the year."
Ann lowered its full-year sales outlook to $2.52 billion from an earlier $2.54 billion, which puts revenue just shy of the Street's view of $2.53 billion.
For the current quarter, it sees revenue of $655 million, slightly below the consensus view of $659 million.
Shares of Ann were up about 3.5% in early trade to around $33.80.