By Josh Beckerman
Express, the popular fashion retailer, saw a significant decrease in its shares on Friday, with a decline of 16%. This decline comes as the company announces its plans for further cost reductions and a reverse stock split.
Currently trading at 61 cents, Express shares have fallen by approximately 40% over the course of this year. In May, the company initially revealed its intentions to achieve $65 million in annualized cost reductions by fiscal 2023. However, more recently, Express raised this target by an additional $15 million. They now aim for annualized cost reductions of $120 million by fiscal 2024, with a significant workforce reduction contributing to expected savings of approximately $30 million.
Express plans to execute a 1-for-20 reverse stock split in order to regain compliance with the minimum price requirements set by the New York Stock Exchange. The price of Express shares last traded at $1 on March 7, according to FactSet.
Despite these changes, the company maintains its guidance for the second quarter, anticipating sales and loss per share to align with previous expectations.
Chief Executive Tim Baxter expressed optimism regarding the sales performance of the Express brand during the second quarter. He attributed this improvement to corrective measures taken to address imbalances within the women's assortment architecture. Baxter stated that these positive results provide confidence in the brand's future sales, especially during the second half of the year.