Business

Wednesday August 19, 2009

Saks posted 5th consecutive quarterly loss


NEW YORK: Retailer Saks Inc. posted its fifth consecutive quarterly loss on Tuesday, as consumers continued to cut back on buying luxury fashion.

But the loss wasn't as steep as expected, and the company's stock climbed in morning trading.

The retailer lost $54.5 million, or 39 cents per share, during the three months that ended Aug. 1.

That compares with a loss of $32.7 million, or 24 cents per share, a year earlier.

Analysts surveyed by Thomson Reuters forecast a loss of 52 cents per share on revenue of $563 million.

Revenue fell 15 percent to $561.7 million from $657 million.

Same-store sales sank 15.5 percent during the quarter.

Same-store sales, or sales at stores open at least a year, are a key measure of retailer performance, because they measure growth at existing stores rather than from newly opened ones.

Luxury retailers like Saks have been especially hurt by the recession, as even the most well-off shoppers are cutting back on splurges.

CEO Stephen Sadove said the company was working to cut costs, saying "no expense is sacred."

Those efforts helped gross margin performance to exceed internal expectations.

"I don't like the fact that we're losing money," he told investors on a conference call, adding that results were still better than earlier internal projects.

The company's less-expensive Off 5th stores continued to do better than Saks' full-price stores, but its New York flagship store continued to do worse than the company as a whole.

Saks shares rose 23 cents, or 4.3 percent, to $5.58 in morning trading Tuesday. - AP


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