By  on May 29, 2009

Belk Inc., the nation's largest privately held department store chain with 308 units, had a rough first quarter but managed to post a small profit and meet expectations.

The Charlotte, N.C.-based retailer reported a 90 percent decline in net income to $500,000 for the first quarter ended May 2, compared with net income of $5.1 million for the same prior-year period.

Revenues dropped 7.7 percent to $760.9 million from $817.3 million.

“First-quarter results were in line with our expectations,” said Tim Belk, chairman and chief executive officer of Belk Inc. “Although results continue to reflect the weakened economy, we have begun to see some stabilization in the operating environment, which is positive.”

Belk attributed the profit decrease to the decline in sales and a lower gross profit rate during the period, offset partially by reduced selling, general and administrative costs and lower interest expense.

Net income excluding noncomparable items was $600,000, compared with $4.3 million for the same prior-year period.

“We will maintain our focus on managing expenses and inventories while delivering a compelling shopping experience to our customers,” Belk said. “Our balance sheet remains strong with more than $250 million of cash at the end of the quarter, almost twice the amount as in the same prior-year period.”

Belk opened three stores in the first quarter, in Newnan and Winder, Ga., and Richmond, Ky. The company also completed the expansion of Belk at Colonial Pinnacle at Turkey Creek in Knoxville, Tenn. Two other expansion projects are scheduled for completion later in the year at the Belk stores in Ashland, Ky., and Hilton Head Island, S.C.

Last April, Belk’s board approved a self-tender offer to purchase up to 500,000 shares of common stock at a price of $11.90 a share. The tender offer was initiated on April 22, and on May 20 Belk accepted for purchase 241,664 shares of stock for $2.9 million.

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