Neiman Marcus Group reported a net loss of $29 million in the fiscal second quarter ended Jan. 26, compared with net earnings of $372.5 million in the second quarter of 2018, though the year-ago period included a $387 million tax benefit.
Adjusted earnings before interest, taxes, depreciation and amortization were down somewhat at $134.4 million, compared to adjusted EBITDA of $154.8 million for the second quarter a year ago.
Excluding the Mytheresa luxury web site owned by Neiman’s, adjusted EBITDA for the second quarter was $134.4 million, compared to $147.5 million for the second quarter a year ago. NMG also owns Bergdorf Goodman and Horchow.
Comparable sales rose 0.7 percent, while total revenues reached $1.39 billion, down from $1.49 billion in the year-ago period.
“Our second-quarter results reflect our sixth consecutive quarter of comparable sales increases. The stabilization of our business continues as we work deliberately to transform Neiman Marcus Group into a luxury customer platform, fueled by technology, innovation, and supported by seasoned and talented executives who are laser-focused on this mission,” said Geoffroy van Raemdonck, chief executive officer of the Neiman Marcus Group.
Late in February, NMG reached a preliminary agreement with lenders owning about half of NGM’s debt on an extension and amendment of its debt maturities.
The agreement, if it is approved, would enhance Neiman’s capital structure and give the luxury retailer some much-needed breathing room to sustain its operations, which have been hampered by its debtload. Neiman’s will open its first store in New York City, a three-level, 188,000-square-foot flagship anchoring The Shops & Restaurants at Hudson Yards. It’s the retailer’s most innovative and experimental store and is loaded up with new types of services, amenities and experiences.
The $4.9 billion NMG has $4.5 billion in debt, which includes a $2.8 billion term loan due in October 2020, and two sets of bonds and an asset-backed loan due in 2021.
Neiman’s has been paying hundreds of millions annually to cover the interest costs on its debt, including $307 million during the most recent fiscal year, ended July 28. It’s been a drain on profitability.