Bon-Ton Loss Grows In Q1

Bon-Ton has joined the list of department store retailers that reported sales and income declines in the first quarter.

Comparable store sales in Bon-Ton’s first quarter of fiscal 2016, ended April 30, decreased 2.9%. Total sales in the period decreased 3.3% to $591 million, compared with $610.9 million 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. 

In one bright spot, the company said it achieved double-digit sales growth in omnichannel, which reflects sales via e-commerce as the company leveraged its new West Jefferson facility and expanded store-fulfillment network.

Net loss in the first quarter of fiscal 2016 was $37.8 million, or $1.91 per diluted share, compared with net loss of $34.1 million, or $1.74 per diluted share, in the first quarter of fiscal 2015.  

Kathryn Bufano, president and CEO, Bon-Ton, said, “Ongoing headwinds in the retail environment, unfavorable weather, and a soft Easter all pressured our top line performance during the quarter. We saw only a slight decrease in merchandise margin and reduced inventory levels by 4% on a comparable store basis despite the sales pressure, as we maintained disciplined inventory management. In addition, we moved forward with our cost savings initiatives while continuing to carefully manage expenses. That said, 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. We remain focused on the controllables which we believe will drive incremental sales in the back half of the year including further enhancing both our brand and our merchandise assortments, elevating the communication of our value proposition to both new and existing customers, and once again driving double-digit growth in our omnichannel sales. Longer term, we continue to believe that as we make progress against our seven pillars of execution, we will be poised to drive improved and consistent sales and profitability.”

Bon-Ton operates 267 stores, which includes nine furniture galleries and four clearance centers, in 26 states under the Bon-Ton, Bergner’s, Boston Store, Carson’s, Elder-Beerman, Herberger’s and Younkers nameplates.