The Bon-Ton Stores keeps the status quo in 2Q
Sales decreased, comps increased
Cecile Corral -- Home Textiles Today, 8/19/2010 2:25:14 PM
York, Pa. - The second quarter proved lackluster - but in line with expectations -- for regional department store The Bon-Ton Stores Inc., where sales decreased and comps increased, both slightly.
Net sales for the quarter, ended July 31, decreased 0.10% to $608.5 million from $609.2 million in the same year-ago quarter. Comparable store sales increased 0.2%.
Net loss for the quarter totaled $33.7 million, or $1.91 per diluted share, compared with a net loss of $34.8 million, or $2.04 per diluted share, for fiscal 2009.
Year-to-date net sales increased 1.29% to $1,269.9 million from $1,253.7 million in the first half of 2009. Comparable store sales increased 1.6%.
And net loss for the first half of 2010 totaled $57.3 million, or $3.24 per diluted share, compared with a net loss of $80.2 million, or $4.72 per diluted share, in the prior year period.
"Overall, we were very pleased with our performance in the first half of fiscal 2010," said Bud Bergren, president and ceo, of 278-unit Bon-Ton, which operates stores in 23 states. "Customers responded favorably to our merchandise assortment, including our exclusive private brands and national brands, while e-commerce continued its significant growth."
Looking ahead to the third quarter and balance of 2010, Bergren said the company remains "intently focused on driving sales as we continue to enhance our merchandise assortment by accelerating the penetration of exclusive and distinctive merchandise, tailoring our offerings by region and customer preference, and instituting innovative marketing programs. We believe we are on the right track to achieve our fiscal 2010 goals."
Encouraged by its second quarter results, Bon-Ton has updated its full year 2010 guidance for EBITDA to a range of $235 million to $245 million and for income per diluted share to a range of $0.80 to $1.35. Additionally, its estimate for cash flow is a range of $80 million to $90 million, "which we believe will permit us to manage and reduce our debt levels," said Keith Plowman, evp, cfo.
Assumptions reflected in the company's full-year guidance include: comparable store sales in a range of 1.0% to 2.0% increase; gross margin rate of 37.6% to 37.7%; reduction of $15 million to $20 million in SG&A expense; effective tax rate of 0%; capital expenditures not to exceed $50 million; net of external contributions; and estimated 18.5 million to 19.0 million average shares outstanding.
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