Houston—Stage Stores Inc. lowered its forecast for the year on Thursday as the retailer reported a widened three quarter loss and comparable store sales drop.
For the quarter ended Nov. 2, the parent of Bealls, Goody’s and Palais Royal retail brands posted a net loss of $11 million, or 34 cents a share, compared with a loss of $8.9 million, or 28 cents a share, a year ago. Excluding one-time items, including a $4.4 million, or 8 cents a share, associated with the consolidation of its South Hill, Virginia, operations, adjusted net loss would be $8.4 million, or 26 cents a share, which is in line with analysts’ average estimate.
Net sales declined 2.8% to $360 million below estimate for $375.6 million in sales. Comparable store sales fell 4.6%.
Q4 Outlook Lowered
The company noted that cosmetics, accessories and footwear were its best performing categories during the quarter. Geographically, the South Central and Northeast regions performed better than the company average.
“We were pleased with our strong gross profit rate for the quarter, which resulted in an adjusted net loss per share that was in-line with last year,” said Michael Glazer, president/ceo. “Our comparable store sales improved sequentially each month during the quarter, but significantly lower clearance sales versus last year led to an overall comp decline. Excluding clearance sales from both years, our comparable store sales were positive for the quarter.”
Glazer said the company is confident about holiday sales, but forecast comparable store sales could decline up to 2% in fourth quarter, pointing to the “current challenging sales environment for apparel retailers.”
For its fiscal year, Stage Stores forecast earnings of $1.20 to $1.30 a share, down from $1.30 to $1.40. Analysts’ estimate expects $1.31 a share.