The net sales of Ascena Retail Group in the third quarter of fiscal 2019 were $1,266 mn compared to $1,267 mn in the year-ago period. Comparable sales were flat for the quarter. For the third quarter of fiscal 2019, the company reported a Gaap loss of $1.20 per diluted share, compared to a Gaap loss of $0.20 in the year-ago period.

Gross margin decreased to $722 mn, or 57.1 per cent of sales, as compared to $753 mn or 59.5 per cent of sales in the year-ago period. The decline in gross margin rate from the year-ago period was primarily caused by higher promotional activity to address elevated inventory levels and soft pre-Easter selling at the Premium Fashion and Kids fashion segments, and clearance of the under-performing tops assortment at Lane Bryant.

“The Board and Management have been working together to transform the Company and return ascena to profitable and sustainable top-line growth. Our focus has been, and will be, on creating value for our investors,” Carrie Teffner, Interim Executive Chair, said.

“Third quarter results were better than anticipated, driven by stronger comps. With the elimination of our Value Fashion segment, we are already re-aligning our financial and human capital to support the areas of the business with the greatest growth potential. We have some of the most iconic brands in retail, and are well-positioned in our customers’ minds to capitalize on the equity built into these brands,” Gary Muto, Chief Executive Officer, said.

“As we work to transform and simplify the business, we have made meaningful progress on our comprehensive assessment of ascena’s portfolio of brands. With the successfully completed divestiture of maurices and the announced wind down of our dressbarn brand, we have essentially exited our Value Fashion segment, which has consistently underperformed expectations and generated substantial losses over the last two years. While we continue our portfolio assessment, we are focused on right sizing our corporate overhead structure to support a business with fewer, stronger brands that can deliver growth and profitability levels above the industry average,” Teffner continued.

“While we work to accelerate top-line growth from our more focused brand portfolio, we continue to drive meaningful structural cost reduction. Beyond the $300 mn savings from our Change for Growth programme, we have identified an incremental $150 mn opportunity. We expect the majority of these incremental savings to be realized in Fiscal 2020, and we continue to seek further cost reduction opportunities on an ongoing basis. We have a highly committed and engaged workforce that is focused on delivering the growth and profitability that we know we are capable of achieving,” Muto added.