The Wet Seal, Inc. Announces CEO Departure; Updates Second Quarter EPS Guidance
FOOTHILL RANCH, Calif.--(BUSINESS WIRE)-- The Wet Seal, Inc. (WTSLA), a leading specialty retailer to young women, announced today that its Board of Directors has terminated the employment of the Companys Chief Executive Officer, Susan McGalla, effective immediately. The Board is commencing a search for a new Chief Executive Officer.
In the interim, while the search process is conducted, the Company has formed an Office of the Chairman, led by Hal Kahn, the Companys non-executive chairman of the Board. Also during this interim period, Ken Seipel, the Companys President and Chief Operating Officer, and Steve Benrubi, the Companys Chief Financial Officer, will be co-principal executive officers and members of the Office of the Chairman until a new CEO has been selected by the Board. The Board expressed its confidence that under the leadership of Mr. Kahn and the members of senior management, the Company will have in place a capable leadership team during the search process.
Through the third week of the fiscal month ending July 28, 2012, or fiscal July, the Companys comparable store sales for fiscal July have declined between 13% and 14%. For the second fiscal quarter, the Company expects comparable store sales to decline between 10% and 11%, which is at the low end of its initial guidance range.
The Company currently estimates second quarter loss before non-cash asset impairment and CEO severance costs will be between $0.06 and $0.07 per diluted share, as compared to its initial guidance of a loss between $0.03 and $0.06 per diluted share. The Company is evaluating certain Wet Seal and Arden B stores for potential non-cash asset impairments and will also be incurring CEO severance costs during the quarter. Asset impairment and CEO severance costs were not included in prior guidance and will increase the loss per diluted share for the quarter.
About The Wet Seal, Inc.
Headquartered in Foothill Ranch, California, The Wet Seal, Inc. is a leading specialty retailer of fashionable and contemporary apparel and accessory items for young women. As of June 30, 2012, the Company operated a total of 553 stores in 47 states and Puerto Rico, including 470 Wet Seal stores and 83 Arden B stores. The Companys products can also be purchased online at www.wetseal.com or www.ardenb.com. For more Company information, visit www.wetsealinc.com.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: This news release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, the Companys comparable stores sales and loss per share expectations for its fiscal second quarter and any statements that relate to the intent, belief, plans or expectations of the Company or its management. All forward-looking statements made by the Company involve material risks and uncertainties and are subject to change based on factors beyond the Companys control. Accordingly, the Companys future performance and financial results may differ materially from those expressed or implied in any such forward-looking statements. Such factors include, but are not limited to, those described in the Companys filings with the Securities and Exchange Commission. This news release contains results reflecting partial year data and non-fiscal data that may not be indicative of results for similar future periods or for the full year. The Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.
The Wet Seal, Inc.
Steven H. Benrubi
Source: The Wet Seal, Inc.Copyright Business Wire 2012