Fifth & Pacific Companies Earnings: Here’s Why Investors are Ambivalent Now

Fifth & Pacific Companies Inc (NYSE:FNP) had a loss and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company.

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Fifth & Pacific Companies Inc Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased to $-0.16 in the quarter versus EPS of $-0.22 in the year-earlier quarter.

Revenue: Rose 17.23% to $371.8 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: reported adjusted EPS loss of $0.16 per share. By that measure, the company beat the mean analyst estimate of $-0.18. It beat the average revenue estimate of $358.66 million.

Quoting Management: William L. McComb, Chief Executive Officer of Fifth & Pacific Companies, Inc., said: “We were pleased with the performance of kate spade and Lucky Brand during the quarter, where both brands had solid increases in net sales and adjusted EBITDA. kate spade posted a 63% increase in total net sales and a 22% increase in direct-to-consumer comparable sales, driven by strong performance in all channels of its business. Excluding the impact of $25 million in net sales associated with kate spade Japan, net sales for kate spade increased 34%. We also remain excited about the prospects for the recently launched Kate Spade Saturday lifestyle brand, which is off to a promising start. Adjusted EBITDA for kate spade was ahead of plan in the quarter, despite the planned dilution on adjusted EBITDA margin resulting from the reporting impact of the kate spade Japan acquisition, the launch of Kate Spade Saturday, the expansion of jack spade and the start-up of operations for the brand in Asia.”

Key Stats (on next page)…

Revenue decreased 23.58% from $486.53 million in the previous quarter. EPS decreased to $-0.16 in the quarter versus EPS of $0.12 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a loss of $0.06 to a loss $0.09. For the current year, the average estimate has moved down from a profit of $0.05 to a profit of $0.02 over the last ninety days.

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