LNT Reports Slow 3Q, Mulls Sale

Clifton, N.J. — As Linens ‘n Things warned about a softer-than-expected third quarter performance, a Nordic company announced that it had acquired nearly 10 percent of the retailer — setting off speculation that it might bid for the retailer.

LNT on Sept. 23 confirmed earlier reports that it is exploring its strategic options, including a possible sale.

On the same day, an investor group with ties to Icelandic retail conglomerate JYSK Holding reported that it has acquired a 9.9 percent stake in the company. The disclosure was filed by Icelandic corporation Lagerinn ehf and Danish investor Jakup a Dul Jacobsen. The filers said the group has purchased stock at an average price of $25.58 per share, largely over the last 60 days.

That news — coming on top of the retailer’s disappointing third-quarter guidance — sent Wall Street analysts scrambling to re-examine valuations on the company.

LNT said it expects a steep 10 percent drop in comps and a break-even profit performance during the third quarter. Wall Street had been expecting 3Q earnings of 29 cents per share.

LNT said it will provide fourth-quarter guidance on Oct. 19.

Norman Axelrod, chairman and CEO, said customer traffic had declined significantly and back-to-school missed its target. The fashion content in BTS was “too narrow in appeal and we did not make the kind of progress that we expected in strengthening our value proposition with our guests,” he said.

Axelrod said the company’s new merchandising chief, Jane Gilmartin, has already begun to have a positive impact on seasonal goods for holiday. And he pointed to the rollout of the proprietary Nate Berkus Collection as another bright spot. The Berkus collection launched online a few weeks ago; in-store sets were completed last week. HTT

Home & Textiles Today Staff | News & Commentary

 Home Textiles Today is the market-leading brand covering the home and textiles markets, offering a comprehensive package of print and online products. Home & Textiles Today provides industry news, product trends and introductions, exclusive industry research, consumer data, store operations solutions, trade show news and much more.

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