Sport Chalet's sales decreased 7.9% in the second quarter ended Sept. 27, to $88.8 million as comps fell 12.4%. But its net losses were slashed to $1.2 million, or 9 cents a share, from $4.2 million, or 30 cents, a year ago. The Los Angeles-based sporting goods chain also achieved EBITDA of $4.0 million in the first half versus the minimum requirement of $0.8 million EBITDA contained in the company's current bank loan agreement.
The retailers noted that the bank requirement measures cumulative EBITDA on a year-to-date basis each month; accordingly, the $3.2 million achieved above the minimum EBITDA requirement in the first half of fiscal 2010 can be used to offset any future shortfalls during the remainder of fiscal 2010.
Same-store sales were negatively impacted primarily by continued weak macro economic conditions.
Gross margins improved to 28.0% from 26.5% a year ago. SG&A expenses were reduced to 24.8% from 29.6%, primarily due to cost containment initiatives which resulted in savings of $7.3 million from decreases in salaries, advertising, professional fees, utilities, repairs and maintenance. Inventories were up 6.3% to
The net loss for Q210 did not reflect any net tax benefit (because of tax valuation allowances), while the second quarter of fiscal 2009 reflected a net tax benefit of $2.8 million, or 20 cents per share. Without the tax benefit, the net loss for Q209 would have been $7.0 million, or 49 cents a share.
