A sizable falloff in comparable-store sales and “highly promotional” sales environment more than tripled fourth-quarter losses at Christopher & Banks Corp.
This story first appeared in the April 10, 2009 issue of WWD. Subscribe Today.
For the three months ended Feb. 28, the Minneapolis-based women’s retailer posted a loss of $28.8 million, or 82 cents a diluted share, compared with a loss of $8.3 million, or 23 cents, a year ago.
Sales in the quarter fell 15 percent to $103.9 million from $122.3 million. The firm reported a 20 percent drop in same-store sales for the quarter.
The fourth-quarter loss included a pretax asset impairment charge of $7.3 million, or 17 cents a share, related mostly to underperforming stores and severance. In February, the company cut 24 corporate employees and 30 district managers as part of cost-reduction program intended to save $15 million this year.
“We were disappointed with our fourth-quarter earnings performance resulting from weak traffic combined with a highly promotional environment,” president and chief executive officer Lorna Nagler said. “Our core customer has been spending very sparingly on her wardrobe for the past six months, yet we remain confident that we are well capitalized to outlast this recession and are also positioned to benefit meaningfully when customers return to the mall.”
The company said it will cut capital expenditures by at least half in the coming year compared with last year, when they totaled $18 million, $8 million of which went to new stores and remodels with the rest allotted to technology initiatives. It expects capex to be between $8 million and $9 million in 2010.
For the year, Christopher & Banks recorded a loss of $12.8 million, or 36 cents a share, versus profits of $17 million, or 47 cents a share, in the previous 12 months. Sales in fiscal 2009 slid 5.4 percent to $530.7 million from $560.9 million in 2008.
The company declined to give first-quarter guidance.