Industry News

Pacific Sunwear of California Inc. shares close down 22%

Surfersvillage Global Surf News, 17 November, 2009 : - - Shares of Anaheim-based Pacific Sunwear of California Inc. closed down 22% Tuesday, a day after the mall retailer forecast a loss that at the high end was three times more than Wall Street was expecting.

Pacific Sunwear, which runs stores selling surf-inspired clothes, has a market value of about $255 million, or about $80 million less than the shares closed at Monday before the company's disappointing forecast. For the three months through January, Pacific Sunwear forecast a loss of $17.9 million to $22.4 million.

Analysts had been forecasting a loss of $7 million. The company said it saw “a precipitous decline” in sales of clothes for guys and females in the last two weeks of October and first two weeks of November, prompting the forecast.

The company said it expects same-store sales—a measure of sales at stores open at least a year—to be down about 20% from a year earlier. The forecast dashed hopes of an immediate turnaround at Pacific Sunwear, which has struggled for more than a year.

Chief Executive Gary Schoenfeld, who joined earlier this year, is trying to change things by focusing on clothes from big names such as Huntington Beach’s Quiksilver Inc. and Costa Mesa-based Volcom Inc. He's also seeking to improving customer service at stores, sell more shoes and move away from heavy discounting to sell clothes. "We can’t argue with this shift in strategy, but it’s very much a work in progress," said Mitch Kummetz of Robert W. Baird & Co.

Read the full article at the Orange County Business Journal

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Source : Orange County Business Journal

Industry - Surfersvillage