Elizabeth Arden Earnings: Here’s Why the Stock is Falling Now

Elizabeth Arden, Inc. (NASDAQ:RDEN) delivered a profit and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 21.12%.

Elizabeth Arden, Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 64.29% to $0.10 in the quarter versus EPS of $0.28 in the year-earlier quarter.

Revenue: Rose 0.78% to $267.6 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Elizabeth Arden, Inc. reported adjusted EPS income of $0.10 per share. By that measure, the company missed the mean analyst estimate of $0.33. It missed the average revenue estimate of $289.86 million.

Quoting Management: E. Scott Beattie, Chairman, President and Chief Executive Officer of Elizabeth Arden, Inc., commented, “There were two primary factors that caused our sales and earnings results to be below our expectations in fiscal 2013. The first was due to weakness at one of our largest North American mass retail customers, both in terms of retail sales performance and replenishment rate. The second factor was that are growth projections for the Elizabeth Arden brand proved to be overly optimistic given the complexity and scope of transition underway for the brand repositioning. We remain confident in our repositioning efforts and, in fact, are accelerating the execution of the Elizabeth Arden brand repositioning. We expect to incur the final phase of repositioning expenses, including eliminating pre-repositioned product inventory and exiting unprofitable doors, in fiscal 2014. While resulting in near term charges, this is expected to drive improved performance of the Elizabeth Arden brand going forward. Separately, we are taking steps to improve efficiencies in our sales organizations and in the overall indirect overhead structure.”

Key Stats (on next page)…

Revenue increased 1.18% from $264.48 million in the previous quarter. EPS increased 400% from $0.02 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a profit of $0.50 and has not changed. For the current year, the average estimate is a profit of $2.38, which is the same with that ninety days ago.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)

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