West Marine closed out a difficult fiscal year with a tough fourth quarter. The macro economic situation has definitely not favored the retailer as the summer months spent with extremely high gas prices crimped boating and boating sales, while the slower winter months were exasperated by the recession truly hitting home.
For the fourth quarter, net sales declined 6.1% to $111.1 million from $118.3 million last year. Comparable store sales decreased 5.1% after dropping 9.9% for the year-ago quarter. Gross margins plummeted 510 basis points to 15.1% of net sales, but were offset somewhat by a 490 basis point decline in SG&A expenses to 33.6% of net sales. The company slimmed its net loss for the fourth quarter by 55.8% to $29.0 million, but most of the improvement came from a goodwill writedown in the year-ago quarter that was not mirrored this time around. Diluted loss per share was $1.31 for the quarter after a loss of $3.00 per share last year.
For the full year, West Marine reported a 7.1% decline in net sales to $631.3 million from $679.6 million last year while comparable store sales declined 6.8% after a decline of 7.6% last year. Gross margins dropped 220 basis points to 26.5% of net sales while SG&A expenses increased 50 basis points to 28.0% of net sales.
Despite the declines, a goodwill impairment charge in the year-ago quarter caused retailer to slim its net loss for the year by 22.4% to a loss of $38.8 million, down from a year-ago loss that was just under $50.0 million. In diluted earnings per share terms, net loss amounted to a loss of $1.76 this year, compared to a loss of $2.30 last year.
