Shares Of Christopher & Banks Plunge Following An Updated Outlook For Third Quarter - Cato (NYSE:CATO)

Christopher & BanksCBK

announced on Tuesday an update to its financial outlook for the third quarter. The specialty women's apparel retailer expects its total net sales to be in the range of $114 million to $118 million, below the company's prior guidance of $122 million to $124 million. The company expects its gross margin to improve by only 75 basis points to 100 basis points, compared to previous estimates of an improvement of up to 125 basis points. SG&A expenses is now expected to be $33.5 million to $34.0 million, compared to a prior guidance of $34.0 million to $34.5 million. In the same quarter a year ago the company's SG&A expenses totaled $33.2 million. “We believe that the continued softness in traffic trends, coupled with the difficult overall retail environment, have adversely affected our sales as compared to our initial expectations for the quarter,” the company's Chief Executive Officer LuAnn Via said in a

statement. “We are operating our business with the assumption that the current environment will remain challenging and promotional activity will continue to be aggressive, creating continued pressure on sales and margins.” Shares of Christopher & Banks plunged more than 30 percent following the retailer's profit warning on higher than normal volume. Just after noon on Tuesday, nearly 1.75 million shares traded hands, more than five times the average total daily volume of 289,057 shares. Shares of other apparel, shoes and accessories companies that sell to women were also trading lower on Tuesday. Shares of Ann ANN were trading lower by 2.40 percent in the early afternoon trading session while shares of Cato CATO were lower by 1.40 percent.

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