Joann Inc. stock fell more than 15% in the after-hours session Thursday after the sewing and crafts-supplies retailer swung to a surprise quarterly loss and reported lower sales, saying that it faced inflation and “challenged” supply chains.
Joann JOAN, +3.81% said it lost $35.1 million, or 86 cents a share, in the first quarter, contrasting with earnings of $15.1 million, or 38 cents a share, in the same quarter last year.
Revenue fell 13.3% to $498 million, with same-store sales declining 12.9%. In the same quarter of last year, same-store sales rose 15%.
FactSet consensus called for earnings of 11 cents a share on sales of $525 million.
Selling and general and administrative expenses rose nearly 4% as the company said it spent more in “store refresh” projects and faced higher labor and distribution costs, including expenses with ocean freight.
Joann was “resilient” against “a difficult operating environment for the retail industry,” Chief Executive Wade Miquelon said in a statement.
“Despite unprecedented supply-chain disruptions and high levels of inflation, our product assortments and service standards remain very strong,” Miquelon said.
The impact of “excess ocean freight costs was significant in the quarter,” but costs have moderated in the current quarter.
“While we know that supply chains will continue to be challenged, we have added carrier capacity and operating flexibility to better manage through those challenges and ensure we deliver exciting product assortments to our customers at the best possible cost,” Miquelon said.
Shares of Joann ended the regular trading day up 3.8%. So far this year, Joann shares have lost 24%, compared with losses of around 12% for the S&P 500 index. SPX, +1.84%.