Vera Bradley Q4 Results Beat Street’s Estimates but Outlook Disappoints, Shares Fall in Afterhours Trading (VRA)

Vera Bradley (NASDAQ: VRA) reported late last evening that fiscal fourth-quarter earnings jumped 25% as its top line was bolstered by strong revenue growth from direct-sales; however, shares of designer bag maker fell about 3.50% in aftermarket hours as its outlook on the current quarter and full-year missed analysts’ expectation.

The Fort Wayne-based Company, whose product line includes rage of offerings such as handbags, accessories and leisure items, has seen its top line growth benefitting from growing share of direct sales in recent quarters.

For the quarter ended February 2, Vera Bradley reported earnings of $25.1 million, or 62 cents a share, compared to a profit of $20.1 million, or 50 cents a share, in the year earlier quarter.

Revenue during the quarter soared 21% to $162.6 million. Sales were also boosted due to one extra sales week during the quarter.

Analysts’ consensus estimate was for earnings of 57 cents on revenue of $153 million. The Company’s results matched with its own earlier guidance of earnings of 56 cents to 58 cents on revenue of $149 million to $154 million.

Gross margin increased to 57.9% from 56.4%. The Company attributed better operations management, reduced costs arising from freights and a favorable channel mix aided by growth in full price stores.

Same-store-sales shrank by 0.4%. While revenue from direct-sales jumped 27%, revenue from indirect-sales (sales through specialty stores) rose 11%.

Overhead expenses surged 24% during the quarter.

For the current quarter, the company expects earnings to be in the range of 20 cents to 22 cents a share on revenue of $120 million to $122 million. Analysts’ consensus estimate was for earnings of 35 cents on revenue of $132 million, according to a data compiled by Thomson Reuters.

For the full-year, Vera Bradley expects earnings to come in the range of $1.83 to $1.88 a share on revenue of $585 million to $590 million. Analysts’ consensus estimate was for earnings of $1.87 a share on revenue of $602 million.

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Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.