Polo Ralph Lauren 3Q profit down on lower sales

Apparel maker Polo Ralph Lauren Corp. said Wednesday its fiscal third-quarter profit fell 7 percent as sales slipped amid a pullback in consumer spending.

The retail sector has struggled as consumers tighten discretionary spending due to the ongoing housing slowdown, diminishing credit, rising food costs and unemployment concerns.

The company also cut its full-year earnings and revenue forecasts.

Net income declined to $105.3 million, or $1.05 per share, compared with $112.7 million, or $1.08 per share, a year earlier.

Analysts forecast profit of 86 cents per share, according to a Thomson Reuters survey. Analysts' estimates typically exclude one-time items.

For the period ended Dec. 27, sales dipped 2 percent to $1.25 billion from $1.27 billion. Analysts expected $1.25 billion in revenue.

Retail sales fell 7 percent to $547 million during the quarter as same-store sales slid 13.5 percent. Same-store sales, or sales at stores open at least a year, are a key indicator of retailer performance since they measure growth at existing stores rather than newly opened ones.

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"We expect weak consumer spending to be a meaningful headwind for the foreseeable future," President and Chief Operating Officer Roger Farah said in a statement.

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Polo Ralph Lauren now expects full-year profit of $3.85 to $4 per share, down from its previous guidance of $4 to $4.10 per share.

Revenue is anticipated to be flat to down by a percentage in the low single digits, the company said. Polo Ralph Lauren's prior outlook was for a low single-digit increase in sales.

Analysts predict full-year earnings of $4.02 per share on revenue of $4.97 billion for the fiscal year ending in March.