Bon-Ton to expand into Area Rugs, Window Treatments
March 14, 2017,
York, Pa.-The Bon-Ton Stores will make its first offerings of area rugs and window treatments beginning this year.
The new product areas will be part of an overall expansion of the Bon-Ton home store area, said Kathryn Bufano, Bon-Ton’s president and ceo, during the retailer's conference call to financial analysts discussing the retailer’s fourth-quarter and fiscal-year results.
In addition, Bon-Ton will triple the number of its Close to Home shops, to 150, by the end of this year. The shops are part of the retailer’s strategy to offer products made locally to the store locations, and were cited by Bufano as a success for the company last year.
Bon-Ton’s overall financial results reflected the increasingly difficult environment for department store retailers. Net sales for the year fell 4.3% to $2.6 billion, including a same-store sales decline of 3.8%. In the fourth quarter, net sales were off by 5.5% to $877.3 million, including a drop of 4.7% in same-store sales.
Omnichannel sales did rise by double digits in the fiscal year, while sales through mobile channels almost doubled, Bufano said.
As she also noted on the conference call, Bon-Ton was able to boost its gross margin rates for both the year and the quarter, thanks to reduced markdowns and distribution expenses. For the year, gross margin increased 83 basis points to 35.5%, while in the quarter gross margin rose 145 basis points to 36.2%.
Bon-Ton’s fiscal-year net loss was $63.4 million, compared to a net loss of $57.1 million in the previous fiscal year. In the quarter, net income fell 11.6 percent to 44.7 million.
For 2017, Bon-Ton said it expects same-store sales to decrease by from 2-3%, while gross margin should rise by from 10-20 basis points.
“As we look ahead, we will remain focused on capitalizing on our omnichannel business, refining our marketing strategies, and further evolving our merchandise assortment, with even greater emphasis on growth categories and localization,” Bufano said. “Finally, we will remain disciplined in our inventory management and will once again focus on further reducing our costs throughout the year.”
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