• Q4 profit declined 46.4% to CAD105m
  • Sales rose 6.7% to CAD1.39bn
  • Same store sales increased 2.1%

Canadian department store retailer Hudson's Bay Company has seen its fourth-quarter net profit nearly halve, after it was forced to clear inventory at its Lord & Taylor stores across the US after Hurricane Sandy.

Net earnings reached CAD105m (US$103.8m) for the 14 weeks to 2 February, compared to CAD195.8m in the same period last year.

Retail sales reached CAD1.39bn, up 6.7% from CAD1.3bn in the prior year, driven by men's apparel, handbags and accessories, as well as Topshop/ Topman branded apparel and cosmetics and fragrances.

Same-store sales increased 2.1%, with a 6.1% increase at Hudson's Bay and a 2.9% decline on a US dollar basis at Lord & Taylor.

Over the full year, the company swung to a net loss of CAD44.8m from a profit of CAD195.8m last year. Retail sales increased 5.9% to CAD4.18bn from CAD3.85bn the prior year.

"During the fourth quarter, Hurricane Sandy not only forced us to temporarily close the majority of our Lord & Taylor locations, but also inflicted significant damage upon our surrounding communities," explained CEO and governor Richard Baker.

"As a result, its impact remained a factor for much of the quarter. More recently, during the first quarter of this fiscal year, unusual weather patterns have led to weaker than anticipated results, particularly at Lord & Taylor.

"Despite these headwinds, we have complete confidence in the foundation we are building for our company's future."

Looking ahead, Baker added: "During the year ahead, we will implement a variety of initiatives as we continue to execute upon our multi-pronged strategies for growth."

These initiatives, which the group said will impact results in 2013 and beyond,
include relaunching its Hudson's Bay and Lord & Taylor websites, opening five new Canadian Topshop stores, as well as opening and renovating stores under both of its banners.

It expects fiscal 2013 sales growth to be between 1.5% and 3.5% on a same store sales growth of 3-5% on a constant currency basis.