NEW YORK (AP) — Fifth & Pacific Cos. cut its 2012 earnings guidance Monday, citing weak sales of Juicy Couture products.
Its stock tumbled almost 14 percent in after-hours trading following the announcement.
The company lowered its estimate for adjusted EBITDA, or earnings before interest, taxes, depreciation and amortization. Fifth & Pacific cut its estimated 2012 EBITDA by $25 million and also forecast a weak third quarter. It said that its Kate Spade and Lucky Brands are doing better than anticipated, but full-price sales of Juicy Couture are falling short of expectations
"We are not seeing the improved results we were forecasting for Juicy and are not expecting Juicy to achieve its forecasted results in the fourth quarter," said CEO William McComb. McComb said Fifth & Pacific is optimistic it can get better results from Juicy Couture.
Fifth & Pacific said it expects EBITDA of $100 million to $115 million in 2012 excluding one-time gains and charges, down from its previous estimate of $125 million to $140 million. The company had reiterated that guidance as recently as July 26. FactSet reports that analysts expected the company to report $132 million.
The company said its third-quarter adjusted EBITDA will be between $17 million and $20 million, well below analyst estimates of $35 million.
Fifth & Pacific said it is planning to close a distribution center in Ohio, but those plans have been delayed and it is still shipping some products from the facility. It said the delay will cost it $2 million to $4 million. Those costs are included in the company's new outlook.
Shares of Fifth & Pacific sank $1.77 to $11 in aftermarket trading. The stock gave up a penny to $12.77 during regular-session trading.
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