Chico’s delivers ‘in line’ Q3 results, withdraws 2023 outlook

Chico’s FAS has published its financial results for the 13-week period ended October 28, 2023, during which time it said that it had delivered results “in line” with its previously issued outlook.

The company reported a net income of five million dollars, or four cents per diluted share, compared to the previous year’s income of 24.6 million dollars. Its adjusted net income came to 13 million dollars, or 11 cents per diluted share.

For the period, net sales saw a 2.5 percent decline to 505.1 million dollars, down from 2022’s 518.3 million dollars.

Its gross margin saw a marginal drop from 40 percent to 38.9 percent of sales, reflecting “higher occupancy costs” and “deleverage on lower net sales”.

Chico’s operational income was 10.5 million dollars, representing 2.1 percent of net sales, down from the year prior, where operations represented 6.1 percent of net sales.

The firm also highlighted costs from its ongoing merger, as it looks towards a pending acquisition by Sycamore Partners, with related costs totaling 7.3 million dollars.

In light of the acquisition, Chico’s said it would not be conducting a conference call for the third quarter, and would also not provide a financial outlook, with it further stating that the previously issued outlook for fiscal 2023 had been withdrawn.

In a release, Chico’s CEO and president, Molly Langenstein, said: "We are excited about the next chapter in our company's future with the pending acquisition by Sycamore Partners.

“We believe they will provide Chico's FAS with additional expertise, financial resources, and strategic flexibility to further fuel our growth. Our commitment to providing solutions, building communities, and creating memorable experiences to bring women confidence and joy is shared by Sycamore Partners. We look forward to working with them to unlock Chico's FAS's full potential."