- Jim McCann, CEO of 1-800-FLOWERS.COM, said, "Throughout fiscal 2010, consumer discretionary spending continued to be impacted by the uncertainty in the macro economy. As a result, total revenues and profitability were below our expectations for the fiscal fourth quarter and the full year, particularly in our core Consumer Floral business category."
- Company Guidance:
- Reflecting the continued uncertainty in the consumer economy, the Company is modifying how it provides forward guidance compared with past practices. This includes the elimination of specific guidance for revenues, EPS, EBITDA and free cash flow. In terms of its outlook for fiscal 2011, the Company does not anticipate significant improvements in consumer demand for discretionary purchases and therefore expects continued challenges to top line growth. During fiscal 2011, the Company plans to:
- * Continue its programs to enhance operating efficiencies by leveraging its business platform;
- * Improve its gross profit margins through a number of initiatives, including reduced promotional activity and enhanced manufacturing operations, and
- * Continue to invest and innovate for the future, including expanding its fast growing social and mobile commerce initiatives, growing its new 1-800-BASKETS.COM business and rolling out a new franchising program for the Fannie May brand.
- For fiscal 2011, the Company expects to maintain capital expenditures at approximately $15 million.
In our FLWS post Tuesday, we mentioned that the risk/challenge remains the weak consumer economy. We know the real estate and job markets both remain problems, especially for discretionary retailers such as 1-800-Flowers.com and our Bidz.com (BIDZ). Walmart's (WMT) negative U.S. same store sales results reported the other day were a telltale sign of the poor condition of cash strapped American consumers.
We'll come back with further commentary within the next several days.
Disclosure: long FLWS, BIDZ.
© 2010 Jeffrey Walkenhorst
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