Vera Bradley 2nd-quarter results disappoint
FORT WAYNE, Ind. (AP) — Handbag maker Vera Bradley reported Wednesday that its second-quarter net income fell 2 percent on weak demand for its summer merchandise and increased expenses.
The company cut its full-year guidance and shares fell 10 percent in aftermarket trading.
Net income during the three months ended July 28 fell to $13.4 million, or 33 cents per share. That compares with $13.6 million, or 34 cents per share, in the prior year quarter. Analysts expected 36 cents per share, according to FactSet.
Revenue rose nearly 19 percent to $123 million from $103.8 million last year. Analysts expected $122.2 million.
Vera Bradley, like many of its peers, is coping with high cotton and labor costs. In addition, the company said its products underperformed in May and June. But results improved in July when fall merchandise arrived in stores.
Selling, general and administrative expenses rose 22 percent as the company invested in its infrastructure and opened full-price stores earlier than expected.
The company now expects full-year net income of $1.60 to $1.63 on revenue of $531 million to $536 million. That compares with prior guidance of net income of $1.68 to $1.71 per share on revenue of $535 million to $540 million.
Analysts expect $1.69 per share on revenue of $536.4 million.
For the third quarter the Fort Wayne, Ind.-based company expects net income of 37 cents to 39 cents per share on revenue of $134 million to $136 million.
Analysts expect 39 cents per share on revenue of $134.4 million.
Shares fell $2.30 to $21.32 in aftermarket trading, after closing up 59 cents, or 2.6 percent, at $23.62.
The stock is down 27 percent since the beginning of the year.