Investing.com -- Shares in The Container Store Group, Inc (NYSE:TCS) tumbled nearly 25% in after-hours trading, after the Dallas-based specialty retail chain posted disappointing quarterly earnings on Monday.
For the fourth quarter of 2014 that ended on Feb. 28, net income for the storage retailer plunged 29% to $13 million or 27 cents per share. The Container Store's revenue rose 3% to $224.3 million, below forecasts of $232.5 million. Analysts had also predicted earnings per share of 31 cents.
The Container Store blamed poor weather during a key sales period near the end of the quarter for the low figures.
“Our fourth quarter did not conclude according to early-in-the-quarter trends,” The Container Store CEO Kip Tindell said in a statement. “Weather was a contributing factor, as we experienced winter storms in February during the vitally important last 4 days of our 50-day Annual elfa® Sale and during the last week of our 19-day Sale’s extension."
"Historically, approximately 20% of our elfa Sale sales occur during those last 4 days and approximately 60% of the Sale extension sales occur in the final week. Additionally, a stronger U.S. dollar had a significant impact on the conversion of our Elfa subsidiary sales,” Tindell said. “Weather and foreign exchange headwinds aside, our sales performance fell short of our expectations in fourth quarter and in fiscal 2014. We can and will do better.”
The Container Store also revised its net income estimates for 2015 downward to 30-38 cents per share on $800 to $815 million in earnings. Previously, analysts had forecast earnings per share of 56 on $870.7 million in revenue.
“We are focused on strengthening our business as we build for the future in order to create long-term value for all of our stakeholders," Tindell added. "We remain very confident of, and excited about, the potential of our three major strategic initiatives -- TCS Closets, Contained Home and POP! -- with fiscal 2015 serving as an investment year for these programs in order to bolster their longer-term success. We’re also working on shorter-term opportunities to drive the core business, innovate and differentiate.”
Shares in The Container Store fell 5.41 or 24.94% in after-hours trading to 16.28.