Dive Brief:
- Express received a notification letter on Tuesday from the New York Stock Exchange stating that the company has failed to meet its requirement for trading.
- The retailer is no longer in compliance with the continued listing criteria requiring an average closing share price of at least $1.00 over a 30 trading-day period. It has six months following the delisting notice to regain compliance with the minimum price criteria.
- The company will continue to be traded under the ticker EXPR during this time, but will have an added designation of “.BC” to indicate the status of the stock is below compliance with the NYSE continued listing standards. Express plans to notify the NYSE of its intention to comply with listing criteria.
Dive Insight:
Express may enact a reverse stock split — subject to board and stockholder approval — in order to reach compliance with the NYSE.
The delisting notice does not impact the company’s ongoing operations, reporting requirements with the SEC or trigger any violation of its debt obligations, according to Express.
The company recently reported its financial results. For the fourth quarter, net sales were down 14% to $514.3 million, with comparable sales down 13%, while operating loss was $39.3 million, compared to operating income of $10.3 million in the year ago period. For the year, net sales and comparable sales were both flat.
“Our strategy to elevate our brand with higher average unit retails and reduced promotions — which had driven steady growth for five consecutive quarters through the second quarter of 2022 — bumped up against reduced consumer spending and increased price sensitivity in discretionary categories,” CEO Tim Baxter said in a statement regarding the results. “Our women's business further impacted our performance in the second half of the year. We recalibrated with urgency to address imbalances in the assortment architecture late in the third quarter of 2022, improve the composition of our inventory and advance product deliveries. Our outlook for 2023 reflects improved sales trends as we move through the year.”
The company’s guidance for 2023 includes positive comparable sales in the low-single digits, a net interest expense of $10 million and capital expenditures of around $55 million.
At the end of last year WHP Global invested $260 million in Express, giving the brand management firm a 7.4% stake in the company.
Over the past year, Express stock hit a high of $4.02 in May. At the time of publication the stock is trading at 79 cents.
