TORONTO: Canadian department store retailer Hudson's Bay Co reported a quarterly loss on Tuesday, due in part to an impairment charge related to weak sales at Saks OFF 5TH and Gilt.
The Lord & Taylor operator posted a net loss of C$152 million, or 83 Canadian cents per share, in the fourth quarter ended Jan. 28. This compared with a net income of C$370 million, or C$1.88 per diluted share, a year earlier that also included a C$333 million net gain related to the sale of investments in joint ventures.
Quarterly sales rose 2.5 percent to C$4.6 billion, higher than the 4.48 billion analysts had projected according to Thomson Reuters I/B/E/S.
The company reported a non-cash goodwill impairment charge of C$116 million, saying it was a necessary step due to recent sales weakness at its Saks outlet chain, OFF 5th, and Gilt, an online shopping and lifestyle website.
HBC, which said the two banners have the potential for long term profitable growth, was working to combine inventory at both operations by the end of the year, refocus on higher-end products, and improve website capabilities.
The company also planned to spend between $450 million and $550 million in net capital investments in fiscal 2017, with priority on projects including growth in Europe and ongoing international renovations. Spending is expected to be about $150 million less than the prior year.
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