Abercrombie Q4 Tops View, Dollar Tree Sales Miss; Campbell Boosts FY Profit View

(RTTNews) - Abercrombie & Fitch Co. (ANF) reported a profit for the fourth-quarter that declined 14.2 percent from last year. Dollar Tree Inc. (DLTR) posted profit for the quarter, while Campbell Soup Co. (CPB) reported profit in the second-quarter.

The fourth-quarter results of Abercrombie topped analysts' estimates. But, Dollar Tree's quarterly net sales missed their estimates.

Campbell Soup raised its annual adjusted earnings guidance, but maintained net sales and organic sales growth outlook.

Abercrombie & Fitch's fourth-quarter net income attributable to the company declined 14.2 percent to $83.13 million from last year's $96.94 million, with earnings per share decreasing to $1.29 from $1.42 in the prior year.

Both quarterly adjusted earnings per share and revenue beat analysts' estimates.

The company currently expects the majority of the impact from COVID-19 to occur in the first half.

For the first quarter of fiscal 2020, the company expects net sales to be down mid-single digits. The outlook includes an estimated adverse impact of COVID-19 in the range of $40 million to $50 million and the adverse impact of changes in foreign currency exchange rates of about $5 million.

Comparable sales for the first-quarter are anticipated to be down mid-single digits, compared to positive comparable sales of 1 percent last year. Looking ahead for fiscal 2020, the company projects net sales to be flat to up 2 percent. The guidance included an estimated adverse impact of COVID-19 in the range of $60 million to $80 million and the adverse impact of changes in foreign currency exchange rates of about $10 million.

The company expects annual comparable sales to be down low-single digits, compared to positive comparable sales of 1 percent last year. Adjusted earnings per share for the fourth-quarter was $1.31 compared to $1.35 in the previous year. Analysts polled by Thomson Reuters expected the company to report earnings of $1.23 per share for the fourth-quarter. Analysts' estimates typically exclude special items.

Net sales for the fourth-quarter grew 1.7 percent to $1.18 billion, from $1.16 billion in the prior year. Wall Street analysts had a consensus revenue estimate of $1.17 billion for the fourth-quarter.

Comparable sales for the fourth-quarter was up 1 percent compared to an increase of 3 percent in the prior year.

Meanwhile, Dollar Tree posted net profit of $123.0 million or $0.52 per share in the fourth quarter, compared to loss of $2.31 billion or $9.69 per share in the prior year's quarter. The prior year results were hurt by higher expenses and an impairment charge.

"As we enter 2020, our teams are aligned, energized and focused. Plans for the year include approximately 1,250 Family Dollar H2 renovations, the launch of Dollar Tree Plus! 2.0 initiative," said Gary Philbin, chief executive officer of Dollar Tree. Looking ahead for the first quarter of 2020, the company projects earnings per share, including tariff costs, to be in the range of $1.00 to $1.09. It expects consolidated net sales of $5.89 billion to $5.99 billion, with a low single-digit increase in same-store sales for the enterprise. Analysts expect the company to report earnings of $1.20 per share and revenues of $6.03 billion for the first-quarter.

For full-year 2020, the company anticipates earnings per share to be in the range of $4.80 to $5.15. Analysts expect annual earnings of $5.29 per share.

Consolidated net sales for full-year 2020 are expected to range from $24.21 billion to $24.66 billion. Analysts expect annual revenues of $24.76 billion. This estimate is based on a low single-digit increase in same-store sales and approximately 3.1% selling square footage growth.

The outlook does not include any potential impact related to the supply chain or other aspects of the Company's business for the COVID-19 coronavirus.

Excluding discrete costs, adjusted earnings per share for the fourth-quarter were $1.79, compared to $1.90 in the previous year. On average, 24 analysts expected the company to report earnings of $1.75 per share for the fourth-quarter.

Consolidated net sales for the fourth-quarter increased 1.8 percent to $6.32 billion from $6.21 billion in the prior year's fourth quarter. Analysts expected revenues of $6.39 billion for the fourth-quarter.

Enterprise same-store sales increased 0.4 percent. Same-store sales for the Dollar Tree segment increased 1.4 percent on a constant currency basis or 1.5 percent when adjusted to include the impact of Canadian currency fluctuations. Same-store sales for the Family Dollar segment decreased 0.8 percent.

Campbell Soup Co. (CPB) reported that its second-quarter net earnings attributable to the company were $1.21 billion or $3.97 per share, compared to a net loss of $59 million or $0.20 per share in the previous year. The company raised its fiscal 2020 adjusted earnings per share outlook to a range of $2.55 - $2.60 from the prior expectations of $2.50 - $2.55 per share. Analysts expect annual earnings of $2.53 per share.

However, the company continues to expect net sales and organic sales change to between a decline of 1 percent and a growth of 1 percent, implying sales between $8.03 billion and $8.19 billion.

Earnings from continuing operations for the second-quarter were $171 million or $0.56 per share compared to $176 million or $0.58 per share in the same quarter last year. Excluding items impacting comparability, adjusted earnings per share from continuing operations increased 11% to $0.72 per share, reflecting the lower adjusted net interest expense and increase in adjusted EBIT.

Adjusted earnings per share were $0.76 compared to $0.77 per share in the prior year. Analysts expected the company to report earnings of $0.66 per share for the quarter. Net sales for the quarter declined 0.5 percent to $2.16 billion, from $2.17 billion in the previous year. Analysts expected revenues of $2.15 billion. Organic net sales, which exclude the impact from the sale of the European chips business, increased 1% from the prior year driven by gains in Snacks.

In the second quarter of fiscal 2020, Campbell achieved $45 million in savings under its multi-year cost savings program, inclusive of Snyder's-Lance synergies, bringing total program-to-date savings to $650 million.

As previously announced, the company expects to deliver cumulative annualized savings of $850 million by the end of fiscal 2022.