Bon-Ton Stores Narrowed Q3 Loss Beats Estimates

Bon-TonYork, PA—The Bon-Ton Stores reported today a narrowed third quarter loss less than $1 million and well below analysts’ expectations.

For the quarter ended Nov. 2, the owner of Boston Store, Younker’s, Bon-Ton, Carson’s, Elder-Beerman and Herberger’s posted a loss of $931,000, or 5 cents a share, compared with a loss of $9.8 million, or 55 cents, in the third quarter 2012. Analysts’ average estimate predicted a loss of 29 cents a share.

Net revenue was down 2.6% to $651.2 million below analysts’ estimate for $674.78 million in sales. Comparable store sales also were down 2.8%.

E-Commerce Growing

“We saw meaningful improvement in our comparable-store sales toward the end of the quarter,” Brendan Hoffman, president/ceo, said. “Additionally, due to strategic inventory reductions, we ended the quarter down approximately 5% on a comparable-store basis. Strong performances in a number of key merchandise categories where we increased our investment lead us to believe that we are on track with our strategic initiatives.”

Hoffman noted that the company’s e-commerce business is growing at a healthy pace, “benefiting from traffic-driving initiatives and our broader merchandise assortment.”

In the third quarter, gross margin decreased $6.3 million to $238.2 million. Gross margin was flat to third quarter 2012 at 36.6%.

Selling, general and administrative decreased $9.6 million to $215.2 million. The expense rate decreased to 33% of net sales, compared with 33.6% of net sales in the third quarter last year.

Hoffman said Bon-Ton is “looking forward to the holiday selling season with a fresh and inspired merchandise assortment that offers our customers quality and value in an exciting shopping environment.”

Bon-Ton also reaffirmed its full year fiscal forecast for earnings in the range of 15 cents to 75 a share. Analysts project annual earnings of 46 cents.

 

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Jeff Prine

Jeff Prine, Editor at Large, Accessories Magazine
Jeff returns as a regular contributor to Accessories magazine. Initially Jeff worked as senior editor at Accessories more than 20 years ago and his love of the industry has followed him until present. Since his tenure here, Jeff has continued to report jewelry, watch and other luxury goods trends as executive editor at Modern Jeweler magazine, fashion director at Lustre, and as contributor on products and trends for consumer and trade publications and websites. In addition to his editorial experience, Jeff also served as an adjunct instructor for accessories merchandising at Fashion Institute of Technology. jeffp@busjour.com