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Earnings Calls: 
Pacific Sunwear of California Earnings Call, Fourth Quarter 2008
Author: Maclintosh Kuhlengisa
123jump.com
Last Update: 5:25 PM ET March 14 2009

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The retailer reported an 8% drop in sales to $352 million as same stores sales declined 10%. As a result it had a loss of $27.6 million or 42 cents a share versus income of $19.6 million or 28 cents per share last year.


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I think if you go in to our stores you’ll begin to see kind of an evolving assortment on the t-shirt business which was typically more around the more conditional board sports but that whole area is evolving in terms of art, in terms of reference points, in terms of the nature of the brand mix there.

Adrienne Tennant (Friedman, Billings, Ramsey): Are there any categories in spring that we will notice as walk the stores that are down trending or kind of getting bigger as a percentage of the floor or smaller?

Sally Frame Kasaks:Not really. We sort of got a bit of a wrap and I know the Internet and the blogs were going crazy that we were getting out of the board short business and that’s not true.

But, what we did do is we did reduce our dependence on those in most of the country for that February period both in terms of swimwear and board shorts. So, clearly that business is going got be a little bit less over the course of the six months but it was because we had just opted not do as much as we had done in the past in those categories.

Today, I think you would find the appropriate level of board shorts and swimwear for both junior’s and guy’s. I don’t think you will notice anything that is particularly down trending.

You’ll see our t-shirt business getting larger and I think you’ll see our denim business about where it should be. But, we’re still looking at our short business overall and we haven’t gotten a really clearly defined trend in young men’s or in juniors at this point but that’s more seasonal and we’ll deal with that as the season goes on.

Adrienne Tennant (Friedman, Billings, Ramsey): What was the thought behind the board shorts for February and early spring?

Sally Frame Kasaks: Not, it’s not early spring, it was specifically February. Our goal was how do we use our inventory and frankly we hit with board shorts, we use to bring them in sometime in January/February and we’d sit with them until the third week of March, is that the best use of inventory?

Now, certainly Florida and certain markets had them where they’re appropriate but we just absolutely thought that it was not worth the investment based on past sales and experience particularly over the past four or five years that I have been watching this business.

The same thing with swimwear, it was a much more reduced assortment in most of our stores. However, we’re pretty much to where we would want to be between this floor set and the next I think you will see a fully flush style, very appropriate level of swim and board shorts in relationships to the sales we’re expecting.
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