City of Commerce, Calif. Discount retailer 99 Cents Only Stores said Wednesday that its fiscal fourth-quarter loss widened due to higher-than-anticipated inventory shrink and rising operating expenses.
For the quarter ended March 29, 99 Cents Only Stores reported a loss of $4.4 million, compared with a loss of $1 million in the year-ago quarter.
The company's revenue rose year over year to $290.5 million from $277.9 million. But its gross margin was hurt by $15.5 million in inventory shrinkâ€”more than triple the amount in the same quarter last year and $5.5 million higher than the company expected. Inventory shrink is a decline in inventory due to accounting errors, employee theft or shoplifting.
"While we have reduced the increased scrap-related shrink experienced last summer, we expected to have betterÂ results regarding theft-related shrink," 99 Cents Only Stores chief executive Eric Schiffer said in a statement.