Despite reporting a rise in its full year sales, Canadian sport retailer West 49 fallen into the red, incurring a net loss of C$2.6m, compared to net income of $1.5m for fiscal 2008.

Net sales increased 3.8% to C$64.8m for the fourth quarter and 2.7% to $210.4m for the fiscal year, primarily due to the inclusion of an additional week compared to the corresponding periods in fiscal 2008.

"Despite the volatile and uncertain economy, we have maintained our market share, proving that we remain very relevant to our customers," said Sam Baio, CEO of West 49 Inc. "We continued to grow our top line, largely the result of our strong performance during the peak back-to-school and holiday seasons.

"While we took a hit on margins to preserve market share in this challenging retail environment, our focus on expense management continued to yield returns. More importantly, our competitive retailing strategies and prudent management of operations better position us for longer term growth."
Normalized EBITDA decreased 29.8% to C$3.3m for the quarter and 61.4% to $3.4 million for the fiscal year, the company said. The decreases were primarily due to lower gross margins.

Normalised net income was C$1.1m, or $0.02 per share, for the quarter compared to $2.2m, or $0.04 per share, for the fourth quarter of fiscal 2008.

"Although, our inventory was a little higher at year end than it was the year before, this was the result of a strategic decision to flow goods into the stores earlier in January," said Baio. "This has helped our comparable stores sales in February and March - the first two months of our first quarter of fiscal 2010.

"During these two months, our comparable store sales have been especially strong for our core West 49 banner, comping in the low double digits.

"While we are pleased with the strong comparable store sales during the first two months of our first quarter, we caution investors that we ran a "No-Tax" discount event in our West 49 stores during the month of April last year and we would be hard-pressed to comp positively to results for that month."

Speaking about the Company's longer-term outlook, Baio added: "We continue to believe in the strong growth potential of our business, especially our core West 49 banner. However, given the current environment we have to be prudent and definitive in the actions we take to preserve and grow our market share and strengthen our business.

"This means that maximising the value from existing operations will continue to take precedence over other elements of our growth strategy over the near term."