US: Restructuring costs push Wilsons Leather to Q4 loss
Leather apparel and accessories retailer Wilsons The Leather Experts Inc has swung to a fourth quarter loss after being hit by a hefty cost for closing 160 of its stores and remodelling 100 others.
For the three months to 2 February, the company reported a net loss of $8.4m. The net loss available to common shareholders was $9.2m or $0.23 per basic and diluted share, the company said.
The calculation includes a charge of $19.7m for shuttering 160 mall stores and changing the 100 remaining mall stores to its new branded women's accessories concept called "Studio."
This compares to a profit of $12.0m, or $0.31 per basic and diluted share, in the same period last year.
Net sales for the quarter fell 8.7% to $121.4m from $133.0m, while comparable store sales dropped 2.4%.
For the full year, net loss was $77.5m. The net loss available to the common shareholders was $96.8m or $2.46 per basic and diluted share.
Excluding the fourth quarter impairment charge and financing adjustments, the 2007 year-to-date net loss and basic and diluted loss per share were $57.8m and $1.47, respectively, compared to a 2006 net loss of $33.1m, or $0.85 per share.
Net sales for the year fell 12.7% to $280.4m from $321.3m, with same-store sales down 10.4%.
Chief executive officer Michael Searles described 2007 as "a disappointing year for Wilsons Leather," adding: "We do not believe that a mall based specialty leather outerwear concept is relevant any longer in today's marketplace."
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