Ann Inc. (NASDAQ:ANN) Q1 2015 Earnings Conference Call - Final Transcript
May 22, 2015 • 08:30 am ET
Good morning, ladies and gentlemen, and welcome to ANN INC.'s First Quarter 2015 Conference Call. At the request of the company, today's conference call is being recorded. If you have any objections, you may disconnect at this time. Following the prepared remarks by the company, you will have the opportunity to ask questions.
I would now like to turn the call over to Judy Lord, Vice President, Investor Relations. Please go ahead.
Thank you, Ria, and good morning, everyone. Thank you for joining us again. I'm here with Kay Krill, ANN INC.'s President and CEO; and Mike Nicholson, our Chief Operating Officer and CFO. Kay will lead off with an overview of our first quarter performance and provide a brief update on our strategic growth initiatives. Mike will then review our financial results in more detail and address our outlook for the second quarter and full year 2015.
Finally, as you know, we have entered into a definitive merger agreement with Ascena Retail Group, under which ascena will acquire ANN INC. for a combination of cash and stock. In connection with the proposed transaction, ascena intends to file with the SEC, a registration statement on Form S-4 that will include a proxy statement of ANN that also constitutes a perspective of ascena, reflecting the regulatory requirements. On this call, we will only be taking questions on the results of ANN INC.'s first quarter, the outlook we have provided in our press release and on the remarks that Kay and Mike will be making during their presentations.
(Forward-Looking Cautionary Statements)
With that, let me hand it over to Kay.
Good morning, everyone. Thank you for joining us to review our financial results for the first quarter of 2015, as well as our outlook and our strategic growth initiatives for the year. As Judy mentioned, our discussion this morning is only focused on our quarterly results and the business of the business.
Before we get started, however, let me just say that the Board and I are very pleased with the outcome of our strategic review process, and we are confident that the agreement with ascena is in the best interests of ANN INC.'s stockholders. The combination of cash and stock provides stockholders both immediate and certain value and the opportunity to participate in the upside of the combined company. In addition, this is the right next step for our company and our associates, clients and business partners. We look forward to completing the transaction and this next chapter for ANN INC.
Turning now to our results. Overall, I am pleased that we delivered bottom-line results for the quarter that exceeded our expectations. We were able to achieve these quarterly results despite softer than anticipated gross margin through ongoing effective management of expenses. To recap the results, total net sales for the quarter increased 1% to $598 million, up from $591 million in the first quarter last year. Comparable sales declined 1.5%, reflecting a comp decline of 3% for the Ann Taylor brand