LOEHMANN’S EARNINGS RISE IN QUARTER, YEAR
Byline: Vicki M. Young
NEW YORK — There are signs that Loehmann’s customers are returning to the store, at least since the chain emerged from bankruptcy last October.
Loehmann’s Inc. on Wednesday reported that fourth-quarter earnings before interest, taxes, depreciation and amortization rose to $5.5 million for the period ended Feb. 3. A year-ago, the chain reported EBITDA of $1.3 million.
For the year, EBITDA leaped to $21.3 million, up from 1999’s $4.3 million. EBITDA is a frequent measure of the performance of firms either in bankruptcy or newly emerged from bankruptcy.
Loehmann’s, an off-pricer, seems to be benefiting from excess merchandise in the marketplace. As Robert N. Friedman, chief executive officer, told WWD: “When [bridge and designer firms] have leftover merchandise at the end of the season, we get the first phone calls because we can absorb the most units.”
Income for the quarter, including reorganization items, fresh-start adjustments related to coming out of bankruptcy and an extraordinary gain, was $453,000 against a $3.8 million loss in the comparable year-ago period.
Sales dipped 3.5 percent, to $86.9 million from $89.9 million, reflecting the reduced store count of 44 sites for the period, compared with 55 stores in the year-ago quarter. Comparable-store sales rose 0.5 percent in the quarter.
For the year, Loehmann’s reported $31.5 million in income versus a $33.5 million loss a year ago. Sales, reflecting the closure of 25 stores in the year, dropped nearly 10 percent to $338.4 million from $374.7 million, while comps inched up 1.3 percent.
Executives at Loehmann’s, which does about 90 percent of its business in women’s apparel and accessories and the balance in men’s wear, are scouting for possible new sites to open stores in 2002. Friedman said the business plan provides for opening a couple of stores a year.
“The difficult economy can work to our benefit,” Friedman said. “It allows us to buy more merchandise at significant discounts, which we pass along to our customers. As women are spending less, we might get more of their disposable income.”