Savers Value Village Faces Challenges in Third Quarter
Bellevue-based thrift-store chain Savers Value Village faces challenges as stocks drop and sales growth expectations weaken, resulting in a significant loss in the third quarter.
Savers Value Village, the Bellevue-based thrift-store chain, experienced a significant drop in its stock price after reporting an unexpected loss in the third quarter. The company also revised its sales growth expectations, which further impacted investor confidence.
The company's stock dropped by 23% to reach an all-time low of $10.68 during midday trading. Over the last three months, shares have fallen by 59%. In the third quarter, Savers Value Village reported a loss of $15.6 million, or 10 cents per share, compared to a profit of $15.5 million, or 11 cents per share, in the same period last year. Analysts had predicted a profit of 19 cents per share.
Although sales reached $392.7 million, they fell short of analysts' forecast of $396.3 million.
The company experienced a 3.7% increase in comparable sales, with slower growth in the United States. Despite a strong demand for hard goods, softer goods faced lower demand due to unseasonably warm weather in North America.
Savers Value Village completed its initial public offering (IPO) in June, and this is the second earnings report since becoming a public company.
Chief Executive Mark Walsh expressed the company's outlook for same-store sales growth on the year as 4%, compared to the previous expectation of 5%. For the fiscal fourth quarter, Savers Value Village is predicting flat to 1% growth in comparable sales.
Analysts surveyed by FactSet project a 4.4% rise in same-store sales for the full year.