Chico’s FAS announced Friday that it has initiated a new share repurchase program for up to $100 million of the company's common stock.
As part of that move, the company said it has canceled the remainder of an earlier $300 million share repurchase program, which it announced in 2015. Chico’s said it “completed all but $35.4 million of its previous share repurchase authorization.”
Under a share repurchase program, a company buys back its shares from the market or offers its shareholders the option of tendering their shares to the company at a fixed price. The move is intended to boost stock value by reducing the number of outstanding shares.
Chico’s was trading around $5.40 just after the opening bell Monday. The company’s market capitalization was about $664 million. The company reported $534.7 million in total net sales for the first quarter, down from $540.9 million a year ago.
The company said its gross margin rose to 42.1% up from 40% a year ago. The company’s operating income was $53.3 million and its customer count, spend per customer and multi-channel customer count all rose over the last 12 months.
In 2019, Chico’s announced plans to close 250 stores over three years in a move to improve its operations, sister publication Retail Dive previously reported. But the company slowed store closure plans beginning in December 2021 as trends improved.
In its Q1 earnings report, the company said its full-year financial outlook anticipates consolidated net sales of $2.18 billion to $2.2 billion, and capital and cloud-based expenditures of about $80 million to $90 million.
Chico’s FAS is the parent company of three retail brands – its namesake fashion brand, White House Black Market and Soma. Together, the company said it had 1,262 stores, 58 international franchise locations in Mexico, and two domestic airport locations as of April 29.
Florida-based Chico’s was founded in 1983. The company offers clothing, shoes, accessories, intimate apparel and styling in brick-and-mortar locations, online and through StyleConnect, a digital styling tool.
