USA: Gottschalks Department Stores Feel The Strain
Department store chain Gottschalks Inc reported financial results for its second quarter ended August 4, 2001.
The net loss for the quarter, excluding non-recurring charges related to costs associated with the closure of stores and the company's third-party distribution centre, was $2.4m, or $0.19 per share. This compares to net income, excluding non-recurring charges, of $602,000, or $0.05 per share in the second quarter last year. Including the non-recurring charges the net loss for the quarter was $2.8m, or $0.22 per share, compared to net income of $11,000 or $0.00 per share in the second quarter last year.
For the first half of the year, the net loss excluding the previously described non-recurring charges, was $7.0m, or $0.55 per share, as compared to a net loss, excluding non-recurring charges, of $240,000, or $0.02 per share, for the same period last year. Including non-recurring charges, the net loss for the first half was $7.4m, or $0.58 per share, as compared to a net loss of $831,000, or $0.07 per share, for the same period of last year.
As previously reported, total sales increased 22.2 per cent to $158.7m for the quarter, from $129.9m in the second quarter of 2000. For the first half, total sales increased 25.7 per cent to $315.9m from $251.3m in the first half of 2000. Same store sales for the quarter were even compared to the same period last year, and for the first half, same store sales increased by two per cent.
"Our second quarter operating results clearly reflect the current difficult retail environment," stated Jim Famalette, president and chief executive officer of Gottschalks.
"We experienced a softening of our comparable store sales trend as well as an increased level of promotional activity during the last few months. In addition, we incurred one-time costs associated with the previously announced closures of six stores and our distribution centre in the Northwest.
"These results were not in line with our expectations and we are taking steps to improve our performance for the remainder of the year. We have instituted a major cost containment program, which we expect to result in lower selling, general and administrative expenses in the second half of the year," he concluded.
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