Last week, Pacific Sunwear (PSUN – $5.01) announced that, unlike the almost every other retailer that is seeing the benefit of stronger traffic trends in Q1 2010, that its comp store sales are expected to decline -13% to -18% in the current quarter. Ouch!
Liz Dunn at Thomas Weisel queried the company on its cash flow projections for FY 2010 and the CEO suggested that it was not intending to do so. Then, the call gets interesting. Listen for yourself:
The fact is that PSUN’s management team, in our view, is possibly the worst in specialty apparel. When you’re faced with a “low bar” and you’re still materially underperforming your peers on the top-line, that’s really all investors need to know. Case closed. End of story.
One of our pet peeves is that PSUN management goes a step further in frustrating investors/analysts by refusing to break-out the company’s non-recurring asset impairment charges in its press releases. Instead, this information is broadly discussed in the company’s conference call and the numbers can only be specifically located on the company’s Cash Flow Statement.
The company would do themselves (and the longs) a favor by explicitly breaking out the non-recurring asset impairment charges. We’ve never seen a company NOT do so.
Oddly, PSUN management takes it a step further and gives EPS guidance that includes estimated asset impairment charges without telling investors what the asset impairment charges are expected to be.
Management certainly did not sign-up for much when suggesting that comp store sales are expected to turn positive by Q4 2010. But, with this cast of characters running the show at PSUN, that may be overly optimistic.
This entry was posted
on Monday, March 15th, 2010 at 3:52 pm and is filed under Commentary.
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Classic Moments in Conference Call History – PSUN
Last week, Pacific Sunwear (PSUN – $5.01) announced that, unlike the almost every other retailer that is seeing the benefit of stronger traffic trends in Q1 2010, that its comp store sales are expected to decline -13% to -18% in the current quarter. Ouch!
Liz Dunn at Thomas Weisel queried the company on its cash flow projections for FY 2010 and the CEO suggested that it was not intending to do so. Then, the call gets interesting. Listen for yourself:
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The fact is that PSUN’s management team, in our view, is possibly the worst in specialty apparel. When you’re faced with a “low bar” and you’re still materially underperforming your peers on the top-line, that’s really all investors need to know. Case closed. End of story.
One of our pet peeves is that PSUN management goes a step further in frustrating investors/analysts by refusing to break-out the company’s non-recurring asset impairment charges in its press releases. Instead, this information is broadly discussed in the company’s conference call and the numbers can only be specifically located on the company’s Cash Flow Statement.
The company would do themselves (and the longs) a favor by explicitly breaking out the non-recurring asset impairment charges. We’ve never seen a company NOT do so.
Oddly, PSUN management takes it a step further and gives EPS guidance that includes estimated asset impairment charges without telling investors what the asset impairment charges are expected to be.
Management certainly did not sign-up for much when suggesting that comp store sales are expected to turn positive by Q4 2010. But, with this cast of characters running the show at PSUN, that may be overly optimistic.
This entry was posted on Monday, March 15th, 2010 at 3:52 pm and is filed under Commentary. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.