Christopher & Banks posts Q4 loss on higher expenses

10 Apr '08

3 min read

The deleveraging of occupancy expense was primarily due to the Company's 3.5% decline in same-store sales and the extra week of sales in the fourth quarter of last fiscal year.

Fourth quarter selling, general and administrative (“SG&A”) expenses were $42.3 million, or 33.8% of sales this fiscal quarter, compared to $37.2 million or 27.8% of sales in the fourth quarter of last year.

The higher SG&A rate as a percent of sales was primarily due to planned increases in marketing and IT consulting and other professional fees, the same-store sales decline of 3.5% and the resulting deleveraging of overall expenses, and the extra week of sales in the fourth quarter of last year.

The Company's fourth quarter loss was $8.3 million or $0.23 per diluted share. During the fourth quarter, the Company recorded non-cash, pre-tax, long-lived asset impairment charges of approximately $6.0 million and a goodwill impairment charge of approximately $3.6 million.

The impact of the total $9.6 million of non-cash, long-lived asset and goodwill impairment charges was $0.16 per diluted share, which assumes a normalized federal and state tax rate of 39.5%.

Lorna Nagler, President and Chief Executive Officer, commented, “While our fourth quarter results were disappointing, we were encouraged by the quality of our sales and we continued to make progress on many initiatives that will build a stronger platform for our Company and allow us to evolve andimprove our internal operations and store processes.

In the meantime, we are positioned to navigate through a challenging environment, with inventory per store down 22% at the end of the fourth quarter and merchandise receipt levels planned conservatively as we proceed through the first quarter of fiscal 2009.”

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Christopher & Banks Corporation

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