FORT WAYNE, Ind. (AP) — Vera Bradley’s stock fell in morning trading Thursday as the handbag and accessories company’s fiscal first-quarter revenue missed analysts’ estimates and it cut its guidance for the year.
CEO Robert Wallstrom said in a statement that the retail environment is shaping up to be harder than the company anticipated two months ago. The executive said sales from existing customers are relatively stable, but that its traditional patterns and products haven’t been able to attract enough new customers to the brand. Customer traffic is also down, he added.
Revenue for the period ended May 3 declined 8 percent to $113.5 million from $123 million, below the $118.4 million that analysts polled by FactSet forecast.
Vera Bradley Inc. earned $6.6 million, or 16 cents per share, in the period. That’s down from $9.2 million, or 23 cents per share, a year earlier. Still, this topped the 13 cents per share Wall Street expected.
Wallstrom said that until the chain can make changes to its products and marketing efforts, it doesn’t anticipate sales trends substantially improving. This view prompted Vera Bradley to lower its full-year forecasts.
The Fort Wayne, Indiana, company now foresees fiscal 2015 earnings from continuing operations between $1 and $1.10 per share, with revenue in a range of $530 million to $530.9 million. Its prior outlook was for earnings between $1.20 and $1.30 per share with revenue of $545 million to $565 million.
Analysts predict full-year earnings of $1.26 per share on revenue of $553.8 million.
For the second quarter, the retailer expects earnings of 18 cents to 20 cents per share on revenue of $113 million to $120 million. Wall Street is calling for earnings of 30 cents per share on revenue of $127.4 million.
Shares of Vera Bradley Inc. dropped $1.11, or 4.4 percent, to $24.14 in morning trading.