Acquisition drags Bon-Ton 3Q results
December 8, 2003,
Rising expenses from the integration of Elder-Beerman produced a poor third quarter for Bon-Ton Stores Inc. The department store retailer reported a net loss of $1.7 million for the quarter just ended, as opposed to a modest $328,000 net profit from the third quarter of 2002.
The healthy increase in sales came about mostly from the Elder-Beerman stores that have joined the Bon-Ton fold. On a same-store basis, third-quarter sales fell 0.8 percent for the company as a whole.
Bon-Ton completed the Elder-Beerman acquisition on Oct. 24. The deal brought 69 Elder-Beerman stores into the Bon-Ton corporate family, located in the Northeast, the Midwest and the South.
"We continue to work on the integration of Bon-Ton and Elder-Beerman divisions but remain focused on achieving our fourth quarter planned results," said James H. Balreuther, Bon-Ton's vice chairman and chief administrative officer. "Although comparable-store sales in the third quarter declined slightly, we were able to manage gross margin and expenses so the reduction in earnings…was minimized."
For the year to date, Bon-Ton actually narrowed its net loss from $5.6 million for the first three quarters of 2002 to $3.8 million this year. Operating income increased by nearly 20 percent, to $15.2 million, even though sales rose by a modest 0.6 percent, to $474.7 million.
Bon-Ton Stores Inc.
|Qtr. 11/1 (x000)||2003||2002||% chg|
|Earnings per share||-0.11||0.02||—|
|Average gross margin||37.4%||37.6%||—|
|Nine months||2003||2002||% chg|
|Earnings per share||-0.25||-0.37||—|
|Average gross margin||37.3%||36.4%||—|