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Bon-Ton comparable store sales down 2.9 percent

By Prachi Singh

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Report |REPORT

The Bon-Ton Stores comparable store sales decreased 2.9 percent compared with the prior year period first quarter. Adjusted EBITDA was 1.3 million dollars compared with 4.1 million dollars, same quarter of fiscal 2015. The company has revised its earnings guidance for the full year fiscal 2016.

Commenting on the first quarter, Kathryn Bufano, President and Chief Executive Officer, said, “Ongoing headwinds in the retail environment, unfavorable weather, and a soft Easter all pressured our top line performance during the quarter. Based on our first quarter performance as well as current trends in the second quarter to-date and our expectation that the retail environment will remain difficult, we believe that it is prudent to reduce our full year guidance.”

First quarter summary of the financial performance

Total sales in the period decreased 3.3 percent to 591 million dollars, compared with 610.9 million dollars in the first quarter of fiscal 2015. Sales increases were achieved in home, young men's, big and tall and young contemporary, while woman's Accessories was the poorest performing category. Sales were also impacted by general weakness in apparel and shoes.

The company once again achieved double-digit sales growth in omni-channel, as the Company successfully leveraged its new West Jefferson facility and expanded store-fulfillment network. Other income in the first quarter was 17.4 million dollars, an increase of 1.1 million dollars over the comparable prior year period.

Gross profit decreased 6.4 million dollars to 200.1 million dollars in the first quarter, as a result of decreased sales volume. Net loss was 37.8 million dollars, or 1.91 dollars per diluted share, compared with net loss of 34.1 million dollars, or 1.74 dollars per diluted share, in the first quarter of fiscal 2015.

Curtails earnings guidance for FY16

For fiscal 2016, the company now expects Adjusted EBITDA in a range of 130 million dollars to 140 million dollars. Loss per diluted share is expected to be in a range of 0.95 dollar to 1.45 dollars.

Assumptions reflected in our full-year guidance include a comparable sales performance ranging from flat to a decrease of 1 percent and a gross margin rate ranging from a 30- to 50-basis-point increase over the fiscal 2015 rate of 34.7 percent.

picture:bonton.com

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