Michaels Companies Inc. (NASDAQ: MIK) reported its fiscal third-quarter financial results before the markets opened on Thursday. The company said that it had $0.44 in earnings per share (EPS) and $1.24 billion in revenue. The consensus estimates from Thomson Reuters had called for $0.43 in EPS and revenue of $1.26 billion. The same period of last year reportedly had EPS of $0.40 and $1.23 billion in revenue.
While net sales only increased 1.1% this quarter, the company estimates that it lost about $10 million in sales related to hurricanes Harvey and Irma.
The increase in net sales was primarily a result of a 1.0% increase in comparable store sales (0.5% on a constant currency basis) and sales from the operation of 16 new Michaels stores (net of closures) in fiscal 2017. As expected, this increase was partially offset by lower wholesale revenues.
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In terms of guidance for the fiscal fourth-quarter, the company expects to see EPS in the range of $1.15 to $1.18 and comparable store sales to increase between 1.5% and 2.5%. The consensus estimates are $1.16 in EPS and $1.88 billion in revenue for the quarter.
On the books, Michaels cash and cash equivalents totaled $176.77 million at the end of the quarter, up from $149.97 million in the same period of last year.
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Chuck Rubin, board chair and chief executive, commented:
We are pleased we delivered third quarter operating income in-line with our guidance and diluted EPS above our guidance. We are seeing nice momentum in our business, excluding the disruption from the hurricanes, and we are encouraged by the customer’s response to the improvements we have made, both in-stores and online, to make it easier for customers to MAKE. As we turn to the fourth quarter, we believe our holiday assortment is bigger and better than ever, and our teams are ready to serve customers, both in stores and online. We are pleased with the start to the quarter, although we recognize the heart of the season still lies ahead. We are excited about our plans, and we are confident the investments we’ve made to create an easier, more integrated omnichannel experience will drive continued momentum and deliver stronger financial results.
Shares of Michaels were last seen up about 12% at $21.75, with a consensus analyst price target of $24.30 and a 52-week range of $17.25 to $24.66.
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