Analyst CornerWeekly Insights May 6, 2016 Coresight Research May 6, 2016 Executive Summary We attended a breakfast this week hosted by the Retail Marketing Society, where retail industry titan Allen Questrom was the keynote speaker. According to Questrom, the US is “overstored,” millennials may be more like their elders than the industry believes, and fast-fashion concepts such as Zara and H&M have created excitement in their physical stores by offering a constantly changing product assortment. A new report from Forrester Research says that US online sales will surpass half a trillion dollars by 2020. The figure represents an increase of 56.9% from Forrester’s 2015 estimate of $338.1 billion. Amazon’s retail business represented 60% of all US online sales growth last year. Growth factors included a stronger economy, retailers gaining more repeat business from customers and a strong omni-channel push. British fashion Internet pure play ASOS has launched a new fashion accelerator program in partnership with Wayra, the startup accelerator of Spanish telecom company Telefónica. The accelerator is seeking “mature startups with a proven track record of developing technologies, products and services” in the field of fashion, as it hopes to complement ASOS’s existing online fashion business model. According to a recent survey from J.D. Power and Tencent Auto, only 9% of 5,000 Chinese consumers polled said that they feel very positive about the prospect of unmanned mobility. By contrast, nearly twice as many US consumers reported positive responses to autonomous vehicles. This document was generated for
Insight ReportLoblaw (TO: L) 1Q16 RESULTS: ADJUSTED EARNINGS MEET CONSENSUS Coresight Research May 5, 2016 Executive Summary Loblaw Companies reported that 1Q16 revenues were up 3.3%, in line with the consensus estimate. Adjusted to include the consolidation of franchises, net earnings came in at C$338 million, up 12.3% and fractionally ahead of consensus. Adjusted diluted EPS of C$0.82 was in line with consensus. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Flash ReportAVON (AVP) 1Q16 Results: EMEA Growth Offset by Slowdown in Asia and Latin America Coresight Research May 5, 2016 Executive Summary Avon reported 1Q16 revenues of $1.31 billion, down 16% year over year but up 2% in constant-currency terms and up 3% in constant currency excluding referrals. Adjusted EPS was $(0.07), missing the consensus estimate of $0.03. The results were in line with management’s expectations, but missed analysts’ estimates. The company is going through significant reorganization and experiencing the impact of the strengthening dollar. The company expects to save $20 million from supply chain and sourcing initiatives in 2016. This document was generated for
Insight ReportAbercrombie and Fitch’s (ANF) COO Jonathan Ramsden Steps Down Coresight Research May 5, 2016 Executive Summary On May 5, Abercrombie and Fitch’s current COO and former CFO, Jonathan Ramsden, announced his resignation, effective June 15. Ramsden’s responsibilities will be assumed by other members of the management team. The company has experienced a number of management changes recently. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Company Earnings UpdateAbercrombie & Fitch (ANF) 1Q16 Results: Abercrombie Experiences Traffic Challenges that Are Not Expected to Improve in 2Q Coresight Research May 5, 2016 Executive Summary Abercrombie & Fitch reported adjusted 1Q16 EPS of $(0.53) versus the consensus estimate of $(0.51). Total revenues were $685.5 million versus consensus of $709.5 million. Comps declined by 4% versus expectations of 1.5% increase. By brand, comps at Abercrombie were down 8% versus consensus of a 0.7% decline and comps at Hollister were flat versus consensus of 3%. By region, US comps were down 2% and international comps were down 7%. Management expects 2Q16 to remain challenging overall and specifically in terms of comp results. For FY16, the company expects to see comps improve in the second half. Gross margins are expected to increase slightly over last year and operating expenses are expected to be flat year over year on a US-dollar basis. This document was generated for
Insight ReportSainsbury’s (LON: SBRY) FY16 RESULTS: MISSES EXPECTATIONS AS GROCERY PRICE WAR HITS PROFITS Coresight Research May 4, 2016 Executive Summary The UK’s second-biggest grocery retailer, J Sainsbury, reported that revenues were down by 1.1% and that comps were down by 0.9% for the year ended March 2016. FY16 revenues came in at £23.51 billion versus the consensus estimate of £23.54 billion. Stripping out the impact of write-downs in FY15, underlying basic EPS fell by 8.3%. On a reported basis, diluted EPS climbed from (8.7) pence in FY15 to 22.5 pence in FY16, missing the consensus of 24.6 pence. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Insight ReportKate Spade (KATE) 1Q16 Results: US Comps Show Biggest Gain in over a Year Coresight Research May 4, 2016 Executive Summary Kate Spade reported 1Q16 adjusted EPS of $0.05, in line with the consensus estimate. Total revenues were $274.4 million versus consensus of $268.2 million. North American sales were $218.7 million versus consensus of $214.6 million, while international sales were $48.9 million versus consensus of $49.0 million. Full-year guidance calls for EPS of $0.70–$0.80, consistent with prior guidance and compared to consensus of $0.77. Revenue guidance was reaffirmed at $1.385–$1.410 billion compared to consensus of $1.40 billion. Adjusted EBITDA is expected to be $257–$282 million versus consensus of $263.5 million. Comp growth in the direct-to-consumer business is expected to be up in the low-to-mid teens. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Insight ReportUnder Armour (UA) Announces the Departure of Two Key Executives Coresight Research May 4, 2016 Executive Summary Henry Stafford, Chief Merchandising Officer at Under Armour, will leave the company in July. Kip Fulks, Chief Marketing Officer, will assume the Chief Merchandising Officer responsibility on an interim basis. Robin Thurston, Chief Digital Officer, will also leave the company in July. Michael Lee, Senior Vice President of North America Digital, will take on Thurston’s responsibilities. Thurston is a co-founder of MapMyFitness and Lee is a co-founder of MyFitnessPal. Under Armour acquired the former in December 2013 and the latter in March 2015. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Flash ReportDelhaize (DEG) FY15 Results: Profitability Improves Ahead of Merger with Ahold Coresight Research May 3, 2016 Executive Summary Delhaize reported FY15 EPS of €3.54, an increase of 306.8% from FY14 but below consensus of €4.37. The company reported that revenue increased by 14.2%, to €24.4 billion, just below the consensus estimate. Underlying EBIT increased by 14.4%, to €872.0 million, above the consensus estimate of €854.0 million, while net income increased by 312.5%, to €366.0 million, below consensus of €432.6 million. Delhaize’s revenue in FY15 was lifted by positive comps in all geographies in which the company operates and by store network expansion. For FY16, the company’s top priority is to complete its merger with Ahold. This document was generated for
Flash ReportBurlington (BURL) 4Q15 Results: Revenues in Line, Beats on EPS, Outlook in Line Coresight Research May 3, 2016 Executive Summary Burlington reported 4Q15 revenues of $1.5 billion, up 3.5% and in line with the consensus estimate. Comparable store sales increased by 0.1%, which was above the flat consensus expectation and above guidance. The company reported adjusted EPS of $1.49 for the quarter, up 4.3% from a year ago and beating both consensus of $1.46 and guidance of $1.44–$1.46. The upside was driven by strong performance in the home, beauty (which includes bath, cosmetics and fragrances), youth and missy sportswear categories. For 2016, the company expects comps in the low single digits and adjusted EPS of $2.62–$2.72, versus consensus of $2.72. Burlington expects revenue to increase by 6.5%–7.5%, implying sales of $5.43–$5.48 billion, versus the consensus of $5.43 billion. This document was generated for
Flash ReportAeropostale to File for Bankruptcy in the Coming Days Coresight Research May 3, 2016 Executive Summary Aéropostale is preparing to file for Chapter 11 bankruptcy protection within the next few days. Aéropostale has generated losses in each of its last three fiscal years This document was generated for
Insight ReportProfiling Scoop Retail: The In-Store Digital Platform Coresight Research May 3, 2016 Executive Summary Scoop Retail was founded in London in 2015 to help retailers provide customers with an e-commerce-like in-store experience and to better equip store associates to serve customers. The company’s founders wanted to create a frictionless experience for customers who use a retailer’s digital technology in-store. Mobile point-of-sale options, queue-management systems and ordering kiosks are the three technologies consumers think are most important while shopping. In-store tech has a number of tailwinds behind it: millennial consumers are often looking for convenient, information-rich and tech-enabled shopping experiences; brick-and-mortar retailers continue to look for ways to integrate their online and in-store experiences; and Internet retailers are increasingly opening physical stores. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Flash ReportCoty (COTY) 3Q16 Results: Color Cosmetics Gains Offset Declines in Fragrance Coresight Research May 3, 2016 Executive Summary Coty reported 3Q16 adjusted EPS of $0.09 versus the consensus estimate of $0.12. Total revenues were up 2% year over year, to $950.7 million, versus expectations of $970.7 million. The Europe, Middle East and Africa (EMEA) region and the color cosmetics category led sales growth: each posted a sales increase of 11% on a reported basis. Full-year guidance calls for like-for-like revenue performance to remain consistent with year-to-date trends. Adjusted operating income is expected to be in line with the prior year due to the impact of foreign exchange; high-single-digit growth is expected on a constant-currency basis. This document was generated for
Insight ReportGap (GPS) 1Q16 Results: Gap Outlines Changes for the Long Term Coresight Research May 3, 2016 Executive Summary Gap Inc. reported 1Q EPS of $0.32, in line with consensus and the updated guidance provided on May 9th. Currency fluctuation negatively impacted EPS by $0.02. As previously reported, total revenues were $3.44 billion. Comps were down 5%. Management is not reaffirming its full-year EPS guidance. The company noted that the current consensus of $1.92 “falls within a reasonable range of potential outcomes.” The company also noted that trends in the apparel retail environment would need to improve from 1Q for EPS to get to $1.92. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
Insight ReportEstée Lauder (EL) 3Q16 Results: EMEA Region Leads Performance in the Quarter Coresight Research May 3, 2016 Executive Summary Estée Lauder reported 3Q16 adjusted EPS of $0.73, excluding onetime items and including a $0.03 negative impact related to foreign exchange, versus the consensus estimate of $0.61. Total revenues were $2.66 billion, in line with expectations. Total sales increased by 6% on a constant-currency basis versus consensus of 7.1%; on a reported basis, sales increased by 3%. Full-year guidance calls for EPS of $3.09–$3.14, which is above prior guidance of $3.07–$3.12. Guidance for sales growth of 7%–8% on a constant-currency basis is consistent with prior guidance. Already a subscriber? Log in You are currently viewing a preview of this report. Please select an access option to view the full report. Hide Options - Show Options + Get unlimited access to all our research with one of our subscription plans. View Subscription Plans or Contact us to purchase this report. Contact us ✕ This document was generated for
