For Neiman Marcus Inc., it’s been one tough year of mounting losses and declining sales.
This story first appeared in the September 9, 2009 issue of WWD. Subscribe Today.
The luxury chain Tuesday reported a $168.6 million net loss for the fourth quarter ended Aug. 1, including noncash pretax impairment charges of $143.1 million, compared with a net loss of $35.7 million in the prior year’s quarter, when there were $31.3 million in charges.
On an operating basis, the company lost $192.1 million in the last quarter, versus a $6.2 million loss a year earlier. Adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA, were $5.7 million, compared with $86.1 million in the fourth quarter of fiscal 2008.
With the nation’s affluent dramatically curtailing their store visits and purchasing less per visit, Neiman’s total revenues in the quarter fell to $768 million, compared with $1.03 billion in the prior year. Comparable revenues decreased 23.4 percent.
For the fiscal year, including charges of $703.2 million, the company reported a net loss of $668 million. Neiman’s dropped about $1 billion in sales to $3.64 billion for fiscal 2009, versus $4.6 billion in fiscal 2008.
“Fiscal year 2009 was a very challenging year for our company. We quickly began addressing the many challenges we faced due to the sharp decline in our business, precipitated by the downturn in the economy,” said Burt Tansky, chairman and chief executive officer, who will discuss the results in more detail today in a conference call with Wall Street analysts.
“We tightly managed our expenses, resulting in a total reduction of $183 million, which included the elimination of approximately $100 million of nonvariable costs from our expense structure this year,” Tansky added. “We also aggressively reduced our inventory levels to be more in line with demand, ending the year with 23 percent less merchandise than last year.”
On the brighter side, Tansky noted that Neiman’s ended the year with $323 million in cash, representing an $84 million increase from last year, and recently renegotiated its $600 million revolving credit facility and extended its maturity to 2013.
The charges for fiscal 2009 include $329.7 million related to goodwill, $343.2 million related to trade names and $30.3 million for long-lived assets.