Bon-Ton loss widens, but operating metrics improve
November 29, 2006-- Home Textiles Today,
York, Pa. – Weighed down by soaring interest costs and takeover debt as it builds a department store empire, The Bon-Ton Stores recorded a widening third-quarter loss of $10.9 million, compared with a year-ago deficit of $6.3 million.
Acting as a drag on the bottom line was interest expense of $27.9 million, up almost ten-fold from $2.8 million last year, as the retailer took on debt to build a growing franchise of regional department store nameplates. Long-term debt grew by more than $1.2 billion over the past nine months, to $1.3 billion from just $42.5 million at the end of January.
Layering on sales from the Carson 's stores it acquired from Saks Inc., The Bon-Ton sales almost tripled, rising by 181.5% to $804.1 million from $285.7 million during the same period a year ago. Bon-Ton comps declined by 4.8%.
Looking past its mounting debt and interest costs, the retailer improved key operating metrics, leveraging higher margins and lower costs into an operating profit of $20.7 million, recovering from a small year-before loss of $1.3 million.
Related Content By Author
Countdown to Heimtextil 2015 - Part 3