Bon-Ton Stores Cites Mild Winter for Decreased Fourth-Quarter Profits
April 7, 2012,
"Our fourth quarter sales and margin performance were below our expectations primarily due to the adverse impact of milder weather in our markets on sales of cold-weather merchandise as well as softness in our moderate traditional businesses," said Brendan Hoffman, the company's new president and chief executive. "We responded by aggressively taking markdowns, resulting in a reduced gross margin rate for the fourth quarter and fiscal 2011."
"Sales were below expectations partially due to the mild winter," added Tony Buccina, vice chairman and president of merchandising during the company's earnings conference call earlier this month. He said cold weather categories were down by double digits, but new spring merchandise is selling well in the first quarter because of the mild weather.
Profits declined 8% for The Bon-Ton Stores Inc. in the fourth quarter as sales fell, in part because the relatively warm winter reduced sales of cold-weather merchandise, the company said. Bon-Ton posted net income of $78.2 million, or $4 per share, compared with $85 million, or $4.41, in the fourth quarter a year earlier.
Sales fell 2.7% to $983.2 million from more than $1 billion in the same period in 2010. For all of 2011, Bon-Ton posted a loss of $12.2 million, or 67 cents per share, compared with profit of $21.5 million, or $1.12, in 2010.