West Marine lowers its 2007 expectations
WATSONVILLE, Calif. – Boating supplies retailer West Marine, Inc. (Nasdaq:WMAR) has lowered its expectations for the year, predicting its sales for fiscal year 2007 will be approximately $683 million to $688 million, it reported in a statement this morning.
Comparable store sales for the year are now estimated to decrease between 1.5 percent and 2.5 percent. As a result, the company is revising its full year 2007 earnings guidance to be in the range of $0.24 to $0.34 per share versus the previously issued guidance range of $0.45 to $0.55 per share.
“As we move through the peak season, boating activity throughout the country has not shown signs of recovery, and revenues have been disappointing,” said Peter Harris, West Marine’s chief executive officer. “Primarily, we are seeing softness in the Southeast, particularly Florida, which is a key boating market. Broadly, sales of higher-priced discretionary items, such as electronics, have been weak, and in-store traffic levels, which we believe reflect boat usage, have been lower than expected.”
Harris explained that in the company’s April earnings call, it suggested that if marine industry weakness continued, it would not be able to meet its expected results, and that indeed has been the case.
“We continue to optimize cash flow by maintaining a strong inventory management and expense discipline, while at the same time providing a much improved in-stock and broad assortment of boating merchandise and excellent service to our customers,” Harris added. “We are continuing our focus on store execution, one customer at a time, to maximize sales and pursue market share, even in this challenging environment, so that when the anticipated cyclical improvement takes place and boating activity grows again West Marine emerges as an even stronger leader, as the first choice for the customer.”
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