The Bon-Ton Stores, Inc. reported comparable store sales for the five weeks ended Dec. 31, 2011 decreased 0.7%. Total sales decreased 1.1% to $505.2 million for the five weeks compared with $510.8 million for the prior year period.
Year-to-date comparable store sales through Dec. 31, 2011 decreased 2.8%. Year-to-date total sales through December 31, 2011 decreased 3.2% to $2.71 billion compared with $2.80 billion for the prior year period.
“December sales and margin were negatively impacted by unseasonably mild weather in all our markets throughout the month,” said Tony Buccina, vice chairman, president of merchandising. “Cold-weather categories, which are highly profitable and represent approximately 25% of our business in December, were down mid-teens on a percentage basis. Our best performing businesses included hard home, cosmetics, fine jewelry, children’s and better apparel. Our poorest performing businesses were cold-weather merchandise, as previously mentioned, along with intimate, moderate traditional men’s and ladies’ apparel and moderate traditional handbags and shoes. Our strategic growth initiatives continue to do well in our pilot stores, including sales growth in updated merchandise, which again significantly outperformed total company in sales growth as it has since mid-September. Additionally, our December ending inventory is fresher than last year, reflecting the aggressive markdowns taken during the month.”
Keith Plowman, Executive Vice President and Chief Financial Officer, stated, “Based on a lower than expected gross margin rate in December, we are reducing our gross margin assumptions by an additional 65 to 80 basis points for the year. Therefore, including the gain of approximately $11 million, or $0.60 per share, on the recently announced senior note repurchase, we are adjusting our full-year fiscal 2011 guidance to reflect EBITDA (see Note 1) in a range of $170 million to $175 million, loss per share in a range of $1.30 to $1.00 and cash flow in a range of $5 million to $10 million (see Note 2).
Mr. Plowman continued, “Our excess borrowing capacity under our credit facility at the end of December was approximately $569 million.”
The Bon-Ton Stores, Inc., with corporate headquarters in York, Pennsylvania and Milwaukee, Wisconsin, operates 276 department stores, which includes 11 furniture galleries, in 23 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner’s, Boston Store, Carson Pirie Scott, Elder-Beerman, Herberger’s and Younkers nameplates and, in the Detroit, Michigan area, under the Parisian nameplate. The department stores offer a broad assortment of national and private brand fashion apparel and accessories for women, men and children, as well as cosmetics and home furnishings.
