Bon-Ton Q1 Loss Widens, Results Miss View; Backs 2014 Outlook

(RTTNews) - Department stores Bon-Ton Stores, Inc. (BONT) reported Thursday a net loss for the first quarter that widened from last year, despite gross margin improvement, reflecting higher expenses and a decline in comparable store sales amid extreme winter weather.

Loss per share for the quarter also came in wider than analysts' expectations, and quarterly revenues missed their estimates. The company also reaffirmed its earnings forecast for the full-year 2014.

"We forecasted our first quarter sales to reflect weather challenges, but the prolonged adverse conditions resulted in a financial performance below our expectations. We saw an improvement in sales performance mid-April as the weather became more seasonal and traffic trends improved dramatically," President and CEO Brendan Hoffman said in a statement.

The York, Pennsylvania-based company reported a net loss of $31.51 million or $1.63 per share for the first quarter, wider than $26.64 million or $1.41 per share in the prior-prior quarter.

On average, four analysts polled by Thomson Reuters expected the company to report a loss of $1.22 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenues for the quarter declined to $622.53 million from $661.88 million in the same quarter last year, and missed four Wall Street analysts' consensus estimate of $642.16 million.

Net sales slipped 6.1 percent to $607.46 million from $646.90 million a year ago, and comparable stores sales decreased 5.8 percent for the quarter.

Gross margin for the quarter improved 50 basis points to 35.3 percent from last year, and selling, general and administrative expenses, as a percentage of revenues, increased 180 basis points to 36.6 percent from a year ago.

Looking ahead to fiscal 2014, the company said it continues to expect earnings in the range of $0.40 to $0.70 per share, on projected comparable store sales growth of 1 to 3 percent. Street is currently looking for full-year 2014 earnings of $0.59 per share on annual revenues of $2.87 billion.

"Overall, we believe that the strategies we have in place will yield improved results as we move through the year and, with that, we are maintaining our full year guidance," Hoffman added.

BONT closed Wednesday's regular trading session at $10.64, up $0.30 on a volume of 0.54 million shares.