Bon-Ton Sluggish, Lowers Projections
June 2, 2008-- Home Textiles Today,
The Bon-Ton Stores lowered its fiscal year guidance on reporting a widened loss in the first quarter ended May 3.
Bon-Ton's loss of $34.1 million, or $2.03 per share, was deeper than the loss of $29.3 million, or $1.78 per share, in last year's first quarter. Sales dropped 5% to $700.2 million, with comps declining 4.6%.
Stressing the positive, president and ceo Bud Bergren pointed to measures to improve gross margin and inventory levels. Comp-store inventory came in 8.7% below last year's levels, he said, and SG&A expense was reduced by $4.6 million.
Bon-Ton continues to push private and exclusive labels, with the biggest expansions taking place in moderate sportswear, petite and large-size sportswear, women's shoes and soft home. The retailer's relatively small e-commerce operation met plan for the first time, with the strongest performances coming from soft home, hard home and shoes.
But looking ahead, Bergren said the retail environment will remain challenging through the end of the year. Bon-Ton now expects a comp decline of 2.5% to 3.5% for the year, where previously it estimated a comp gain of 1% to 2%.
The retailer now expects fiscal 2008 results to range from flat to a profit of 30 cents per share. Earlier, Bon-Ton forecast full-year earnings of between 20 cents and 45 cents per share.
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