North America'S Largest Women'S Wear Group Hard To Restructure Sales Of 5 Billion U. S. Dollar Market Value Of Only 200 Million

The loss of Ascena Retail Group Inc. (NASDAQ:ASNA) of the large North American women's clothing group increased sharply. As of the three quarter of May 4th, the group's net loss was deteriorated from $40 million 200 thousand to $237 million 900 thousand, and earnings per share were -1.20 dollars, compared with $-0.20 a year earlier.

The New Jersey based company said that quarterly losses were mainly due to the non cash impairment factor of $174 million. After adjustment, the net loss in the period increased from $15 million 700 thousand to $51 million 400 thousand, and the loss per share increased from $0.08 to $0.26, which is better than FactSet's expected $0.37 and Zacks's expected $0.38.

Gary Muto, group chief executive, said that in the three quarter, sales could be promoted by high-end business. With the company closing the cost effective brand department, changes in manpower and financial expenditure would support the company's return to growth path.

In May 20th, Ascena announced that it would close its brand name Dressbarn and plan to close all 650 stores by the end of the year.

The North American women's clothing group said that the closure of Dressbarn is part of the group's focus on core brand pformation plan. It will continue to focus on the profitability of the brand, and comprehensively evaluate and optimize the portfolio so as to achieve long-term business growth and shareholder value improvement.

Before deciding to close the Dressbarn, the company has already sold another brand maurices of the brand price division, with a paction value of US $300 million. After the cost was removed, the company received a total of $210 million in pre tax cash.

However, Ascena has entered the ranks of penny stocks, and its market value has been hovering around $200 million. After the acquisition of Ann Inc. from the high-end women's clothing group in early 2015, the high leverage and negative effects and integration were unfavourable. It coincided with five years of slow growth in the apparel industry and a serious impact on online retailers. The market value evaporated 95%.

While the stock price plummeted, Ascena also encountered a number of lawsuits' group lawsuits. The North beauty magnate was considered to have deliberately concealed the latter's business difficulties and delayed the goodwill impairment of Ann Inc. when purchasing Ann Inc.. It was not until the three quarter of 2017 fiscal year of May 17, 2017 that the company disclosed a huge loss of $5.29 per share for these reasons, mainly due to the impairment of non cash goodwill of $1 billion 324 million and earnings of $5.22 per share.

In May 1st, the chief executive of group merit and the David Jaffe that contributed to the Ann Inc. paction was no longer guaranteed. It replaced the CEO position as chairman and chief executive Gary Muto from the chairman and the CEO position.

The latter was purchased by Ann Inc. and joined the group. After joining the company in 2008, it was promoted all the way. In 2013, it became the president of LOFT brand, and began to take charge of all brand businesses in August 2017.

David Jaffe's group chairmanship was temporarily promoted by Carrie W. Teffner. In 2015, -2019 worked in Crocs Inc. (NASDAQ:CROX) Crocco group in April to witness the revival of "cave shoes".

In the three quarter performance report, Carrie Teffner said the company is simplifying and streamlining its business with a view to re realizing profitable and sustainable revenue growth.

With the successful stripping of maurices brand and the withdrawal of Dressbarn brand, the Value Fashion sector has been basically closed. In the past two years, the performance of the Department has been lower than expected and caused huge losses.

While companies continue to evaluate portfolios, they will focus on adjusting the company's management cost structure.

Gary Muto added that in addition to the $300 million cost savings plan Change for Growth, the company also found that there was still a $150 million reduction in cost opportunities, and it is expected that these increments will be released in the next fiscal year.

With the growth of high-end brand sales over 5%, Ascena's revenue in the three quarter was basically unchanged at $1 billion 265 million 700 thousand, compared with $1 billion 266 million 700 thousand a year ago.

At the same time, big size women's clothing and children's wear business can be reduced by 3% and 4% respectively compared with sales. The three quarter of Dressbarn will drop 5% compared with sales.

Gross profit margin plunged 240 basis points to 57.1% in the three quarter, mainly due to the increase in stock prices and increased sales promotion. In addition, the sale of high-end women's clothing and children's clothing before Easter was weak, while the sale of large size women's clothing brand Lane Bryant was also poor.

As of the three quarter of May, the group's stock was $654 million, up 16% from the 566 million in the 2018 fiscal year.

As of Monday's closing, Ascena Retail Group Inc. (NASDAQ:ASNA) shares were priced at $1.04, corresponding to the market value of US $202 million, down 2.80% throughout the day, and the stock has fallen 58.57% this year, while the S & P 500 index has gained 15.15% over the same period.