COLDWATER CREEK NET PLUNGES 77.4 PERCENT
NEW YORK — Multichannel women’s wear retailer Coldwater Creek said Wednesday that its third-quarter profits tumbled 77.4 percent, as the Sandpoint, Idaho-based firm could not shake the troubled economy and lack of consumer response to its core catalog.
For the quarter ended Dec. 1, Coldwater Creek’s recorded net income of $1.6 million, or 15 cents a diluted share, in line with lowered expectations, versus year-ago profits of $7.1 million, or 64 cents.
Sales for the quarter rose 3.7 percent, to $141.7 million from $136.6 million. Net sales from the direct channel fell 0.8 percent, to $124.6 million from $125.6 million in the fiscal 2000 third quarter. Within the direct segment, Internet sales increased 26.5 percent, to $45.3 million, and represented 32 percent of the company’s total net sales in the quarter, compared with 26.2 percent last year.
Net sales from the retail channel were $17.1 million compared with $11 million last year. The company operates 29 full-line stores, compared with 10 last year.
“Sales during the third quarter were significantly impacted by both the difficult economic environment and lower-than-anticipated customer response to the apparel in our core Northcountry fall catalog, which put pressure on our margins and affected our ability to leverage operating expenses,” said Georgia Shonk-Simmons, president and chief executive officer, in a statement. “Going forward, we intend to expand the scope of our ‘wear now’ merchandising strategy to offer a better balance of color and a broader assortment of fabrics that are appropriate nine months out of the year.”
On Dec. 7, Coldwater warned about the quarter as well as a fourth-quarter loss.