Lowe’s Delays Some Store Openings
Charlotte, N.C. Officials at Lowe’s Cos. said it remains optimistic that conditions will improve despite a weak housing market and tight credit standards that have created a tough sales environment, according to the Associated Press.
Nevertheless, the company plans to delay the opening of about 20 new stores this year in several hard-hit markets, including California and Florida. Lowe’s also will take a more conservative staffing approach as it hires seasonal workers to prepare for the busy spring season.
“We’re not going to sacrifice long-term success to drive short-term results,” Lowe’s president Larry Stone said. “For example, we’re not going to cut staffing in our stores to the point that it impacts service. But we are managing payroll to the current sales environment.”
The U.S. economy has been hit with a record number of foreclosures, higher gasoline prices and talk of a recession. Stone said the “doom and gloom” has trickled down to consumers who are reluctant to spend on big projects.
Talbots reports 4Q loss
HINGHAM, Mass. Talbots today reported a preliminary unaudited net loss of $171 million, or $3.23 per share, on a GAAP basis for the fourth quarter ended Feb. 2. This result compares to a breakeven net income per share for the fourteen week period ended Feb. 3, 2007, which included acquisition related and financing costs of approximately 15 cents per share.
Talbots said that on a non-GAAP basis, its operating results were better than expected. On a non-GAAP basis, the preliminary fourth quarter loss was $12 million, or 22 cents per share. These results exclude approximately $2.71 per share related to the impairment of the J. Jill intangible assets, 7 cents per share related to the previously announced closing of its Talbots Kids and Mens businesses, 3 cents per share related to the impairment of certain underperforming Talbots and J. Jill stores, 9 cents per share of acquisition related and financing costs, and 11 cents per share of expense related to employee compensation and professional consulting fees.
Total consolidated company sales for the fourth quarter of fiscal 2007 were $587 million, versus reported sales of $638 million for the same period in fiscal 2006. By brand, retail store sales were $388 million for Talbots, compared to $433 million for the 14-week period a year ago, and $86 million for J. Jill, compared to $91 million a year ago. Consolidated direct marketing sales for the recent period, including catalog and Internet, were $113 million, compared to $114 million a year ago.
Consolidated comparable-store sales declined 6% for the latest quarter. Comparable-store sales for the Talbots and J. Jill brands declined 6% and 6.3%, respectively, driven by an especially weak November/December. Consolidated comparable-store sales in January were positive low single digits.
For the full fiscal year, total preliminary unaudited consolidated company net loss was $189 million, or $3.56, per share on a GAAP basis. This result compares to 59 cents per share for the 53-week period ended Feb. 3, 2007, which included acquisition related and financing costs of approximately 46 cents per share.
On a non-GAAP basis, the preliminary unaudited full fiscal year net loss was $7 million, or 13 cents per share. These results excluded approximately $2.71 per share related to the impairment of the J. Jill intangible assets, 7 cents per share related to the previously announced closing of its Talbots Kids and Mens businesses, 6 cents per share related to the impairment of certain underperforming Talbots and J. Jill stores, 41 cents per share of acquisition related and financing costs, and 18 cents per share of expense related to employee compensation and professional consulting fees.
Total company year-to-date sales for the 52 weeks ended Feb. 2 were $2.3 billion, compared to $2.2 billion for the 53 weeks ended Feb. 3, 2007. By brand, retail store sales were $1.5 billion for Talbots, compared to $1.6 billion a year ago, and $327 million for J. Jill, compared to $242 million a year ago. Consolidated direct marketing sales for the recent 52-week period, including catalog and Internet, were $428 million, compared to $385 million in 2006.
Consolidated comparable-store sales declined 5.5% for the recent 52-week period ended Feb. 2. By brand, comparable-store sales for Talbots decreased 5.7% and for J. Jill were down 4.6%.
Trudy Sullivan, Talbots president and ceo, commented, “2007 was a difficult year for Talbots. However, we feel very good about the progress we have made, and believe we are well-positioned to succeed in 2008. Despite the challenges of a weak economic environment, we identified and implemented a number of key initiatives to drive improved short- and long-term performance.
For fiscal 2008, the company is planning conservatively in light of the current macro-related challenges, with top line sales growth of approximately 3%. This plan is based on a slightly negative comp, with the Talbots brand decreasing 1% and the J. Jill brand increasing 1%, compared to fiscal 2007. Built into the company’s 2008 plan is a decline in the number of transactions in the mid single digit range for the combined brands.
Claiborne names Leavitt as Kate Spade coo
NEW YORK Liz Claiborne today announced that Craig Leavitt will join Kate Spade as co-president and coo, effective mid-April 2008. Leavitt, who was previously president of global retail at Link Theory Holdings, will be responsible for providing and driving business performance through the wholesale and retail channels. He will serve in this role along with co-president and creative director, Deborah Lloyd, on the management and overall leadership of the Kate Spade brand.
Prior to his tenure at Link Theory, Leavitt spent several years at Diesel where he was most recently evp of sales and retail. Previously, he spent 16 years at Polo Ralph Lauren where he held positions of increasing responsibility, the last being evp of retail concepts.
Commenting on the announcement, William McComb, ceo of Liz Claiborne, said, “We are thrilled that Craig has agreed to join Kate Spade. His retail experience combined with his strong strategic planning, leadership and communication skills are the perfect complement to Deborah’s creative talent. Craig oversaw tremendous growth with Theory and Helmut Lang and he is eager to apply those learnings here. With Deborah and Craig at the helm, Kate Spade is poised to reach the next level and become a true, global lifestyle brand.”