Elizabeth Arden Cuts Outlook On Weak Holiday Sales; Shares Plunge

(RTTNews) - Elizabeth Arden Inc. (RDEN) Thursday lowered its second quarter outlook, due mainly to weaker-than-anticipated holiday retail sales as well as lower overall sales and higher discounting. The beauty products retailer then said it now expects its full-year results to come in below its prior guidance, and also withdrawn its outlook.

Following the news, shares of Elizabeth Arden plummeted 20 percent in the extended trading hours.

The New York-based company now expect second-quarter earnings in the range of $1.13 to $1.16 per share, adjusted earnings of $1.05 to $1.08 per share and sales of $415 million to $418 million. Analysts polled by Thomson Reuters currently expect second quarter earnings of $1.48 per share on revenues of $467.87 million.

Earlier, the company expected earnings of $1.30 to $1.60 and sales between $450 million to $475 million.

Elizabeth Arden, like most of U.S.-based retailers, reported weak holiday season results, hurt largely by the highly promotional and discount offers.

Chief Executive Scott Beattie said, "Our results were significantly impacted by an increased level of highly promotional and discounted activity globally and weaker than anticipated holiday retail sales and replenishment orders at a number of our non-prestige retail accounts in North America."

"While we are disappointed with these results, we made the strategic decision in the quarter not to participate fully in the heavy promotional and discounted environment," Beattie added.

Elizabeth Arden now expect sales and earnings for fiscal year 2014 to be below its prior guidance. Previously, the company expected net sales growth in the lower half of a 3 to 5 percent range and earnings in the lower half of $2.15 to $2.30 range.

The company, however, has decided to withdraw its previous guidance and will not be providing updated guidance for fiscal 2014 as part of its second quarter earnings announcement on February 5, 2014.

RDEN closed Thursday's trading at $34.50, down $0.50 or 1.43%, on the Nasdaq. However, the stock plunged $6.90 or 20.00%, in after-hours trade following the announcement.