|Talbots said its sales and traffic so far in the third quarter are down. (Emile Wamsteker/Bloomberg News)|
HINGHAM - Talbots Inc.’s posted a bigger-than-expected fiscal second-quarter loss yesterday, stung by increased promotions and markdowns.
The women’s clothing company also announced that Michael Smaldone is out as its chief creative officer and it is looking for a replacement.
Its stock rose 43 cents, or 17 percent, to close at $2.96 yesterday.
The Hingham-based retailer reported a net loss of $37.3 million, or 54 cents per share, for the period ended July 30. That compares with a profit of $941,000, or a penny per share, a year earlier.
Taking out special items, the company reported a loss of 51 cents per share.
Analysts polled by FactSet predicted a smaller loss of 46 cents per share.
Revenue fell 10 percent to $271.1 million from $300.7 million, but topped Wall Street’s estimate of $266.2 million.
Revenue at stores open at least a year dropped 10.4 percent. Talbots said its figure includes online, catalog, and discount sales.
The company’s total outstanding debt rose to $83.9 million from $37.4 million.
Talbots said its sales and traffic so far in the third quarter are down and anticipates its high levels of promotions and markdowns will continue.
The company’s decision to part ways with Smaldone was in part because it believes new leadership will help to improve customers’ reaction to its products. Talbots is looking for a replacement, with president and CEO chief executive Trudy Sullivan taking on the CCO duties until the search is done.
Last month Talbots announced that it had adopted a poison-pill plan, one day after private equity group Sycamore Partners LP revealed a 9.9 percent stake in the company and hinted at a potential buyout.
A poison pill, or a shareholder rights plan, is a strategic move by a company to make its stock less attractive to an unwanted potential buyer.
Talbots, based in Hingham, had 566 stores in 46 states and Canada at the quarter’s end.