Christopher & Banks enhancing its product design
Christopher & Banks Corporation, a specialty women's apparel retailer, reported results for the third fiscal quarter and nine month period ended November 27, 2010.
Results for the Three Months Ended November 27, 2010
• Total net sales for the third quarter were $120.9 million, as compared to $132.0 million for the third quarter of fiscal 2010. Same store sales decreased 7% in the third quarter of fiscal 2011.
• Gross profit decreased 19.3% to $43.4 million, as compared to $53.8 million in the third quarter of fiscal 2010. Gross profit margin was 35.9% for the third quarter of fiscal 2011, as compared to 40.8% in the third quarter of fiscal 2010.
• Operating loss totaled $0.2 million, including a non-recurring pre-tax severance charge of approximately $1.0 million related to the separation of the Company's former Chief Executive Officer. This compares to operating income of $9.8 million in the same period last year.
• Net loss totaled $9.2 million, or $0.26 per diluted share, including a one-time non-cash charge resulting from recording a $12.9 million, or $0.36 per share, valuation allowance related to the Company's deferred tax assets as discussed further below. The valuation allowance recorded in the Company's income tax provision was partially offset by approximately $3.8 million of tax benefit in the third quarter. The Company reported net income of $7.0 million, or $0.19 per diluted share in the third quarter of fiscal 2010.
Results for the Nine Months Ended November 27, 2010
• Total net sales were $348.5 million, as compared to $353.5 million for the nine months ended November 27, 2010. Same store sales declined 1% in the first nine months of fiscal 2011.
• Operating income totaled $6.0 million, or 1.7% of net sales, including non-recurring pre-tax severance charges of approximately $1.5 million related to the separation of the Company's former Chief Executive Officer and Chief Financial Officer. This compares to operating income of $8.8 million, or 2.5% of net sales, for the comparable nine month period last year.
• Net loss totaled $5.4 million, or $0.15 per diluted share, as compared to net income of $6.5 million, or $0.18 per diluted share, for the first nine months of fiscal 2010. This included a non-recurring severance charge of approximately $0.01 per share in the second quarter of fiscal 2011, a non-recurring severance charge of approximately $0.02 per share in the third quarter of fiscal 2011 and a non-cash charge of $0.36 per share related to the valuation allowance on deferred tax assets referenced above.
Larry Barenbaum, Interim President and Chief Executive Officer, commented, “We are clearly disappointed with our performance for the third quarter. We intend to re-establish our presence in the specialty apparel sector by focusing primarily on developing merchandise assortments that are new, fresh and offer an updated feel and fit; enhancing our product design; and better leveraging our relationships with both current and new vendors. In addition, we are focused on improving our in-store experience through enhanced visual presentation and exceptional customer service. I am very optimistic about our future opportunities as we execute on these initiatives.”