ONE PRICE DOWN IN QUARTER, YEAR
NEW YORK — Poor merchandising and an overly ambitious retail expansion contributed to One Price Clothing Stores’ heavy losses in the fourth quarter and year.
Net loss for the quarter was $2.9 million, or 28 cents a share. This compares to profits of $746,000, or 7 cents, in the year-ago period. Results in the most recent quarter include a $1 million pretax charge for restructuring, $800,000 of which was noncash.
The restructuring included the shuttering of 42 smaller, older underperforming stores, 24 of which were closed during the quarter.
The most recent quarter and year-ago period included tax benefits of $1.9 million and $1.4 million, respectively.
Revenues for the period ended Feb. 3 increased 11.3 percent, to $90.6 million from $81.4 million in the year-ago period.
In a statement, Leonard Snyder, chairman and chief executive officer, attributed the poor results to “a lack of focus on our core merchandising strategy, an overaggressive store-opening strategy — which included 44 new stores, 32 of which opened during the spring season — and a slow response to evolving economic and business trends in the apparel sector.”
For the year, net loss was $5.4 million, or 52 cents a diluted share. The loss stood in contrast to fiscal 1999 earnings of $7.1 million, or 67 cents. In addition to the restructuring charge, fiscal 2000 included a $3.8 million benefit from income taxes, while fiscal 1999 saw a $735,000 income tax charge.
Revenues for the Duncan, S.C.-based off-pricer were up 5.6 percent, to $355.6 million, compared to $336.8 million a year ago.
Under the guidance of One Price’s new senior vice president and general merchandise manager, Tom Kelly, the ceo said: “We are focusing our efforts on our core apparel categories for women and children and have discontinued slower-turning, underperforming categories.”
One Price has slowed its expansion pace and plans to open only seven new doors in 2001. It currently operates 641 stores.