Hudson's Bay sales decline 7% in 4Q
Michael J. Knell -- Furniture Today, March 20, 2005
Toronto — Venerable Canadian retailer Hudson's Bay Co. said its fourth-quarter sales slid 7% to C$2.3 billion from the prior year's C$2.4 billion, while net earnings rose 2.9% to C$106 million from last year's C$103 million. Same-store sales fell 2.6% and gross margins declined 160 basis points.
Sales for the year ended Jan. 31, 2005, came to C$7.1 billion, off 3.1% from the prior year's C$7.3 billion. Net earnings remained flat at C$60 million. Same-store sales fell 1.4%.
The 2005 periods are one week shorter than their comparable 2004 periods. Excluding the extra weeks in 2004, 2005 fourth quarter sales were off 3.6% and 2005 annual sales declined 1.9%.
HBC's three banners are department store The Bay, discounter Zellers and specialty retailer Home Outfitters. The Bay is one of Canada's largest furniture and bedding merchants. HBC said sales declined in all product areas, including furniture and bedding, except for grocery, stationary, hardware, cosmetics and jewellery.
"We are obviously disappointed in our sales and margin rates in the fourth quarter and the negative impact this had on our year," said CEO George Heller. "Given HBC's results this year, the company recognizes that the financial targets for 2006 and 2008 released in the fall of 2003 will not be achieved in the time frame originally suggested."
He said HBC will focus on maintaining gross margins and controlling costs to ensure higher earnings in 2005.
