Business of Fashion Retail

Hudson’s Bay Posts Wider-Than-Expected Loss

TORONTO, Canada — Canadian department store operator Hudson’s Bay Company on Thursday posted a wider-than-expected loss and a 3.3 percent fall in first-quarter revenue as it closed some stores and sales at its Lord & Taylor unit fell.

The owner of Saks Fifth Avenue and Lord & Taylor retail chains said earlier this week it was evaluating a C$1.74 billion ($1.3 billion) go-private cash offer from its Executive Chairman Richard Baker and other shareholders.

The company, North America’s oldest, said first-quarter comparable sales decreased 2.1 percent, and excluding Lord & Taylor and Home Outfitters increased 0.3 percent.

Same-store sales at its namesake stores tumbled 4.3 percent in the quarter.

The struggling retailer has been shutting its underperforming shops to cut costs and exploring strategic alternatives such as a sale or merger of its department store Lord & Taylor. The company is also set to sell its stake in its real estate joint venture in Germany to Signa Retail Holdings in a deal valued at C$1.5 billion.

The company reported a profit of C$275 million ($206.80 million), or C$1.15 per share from continuing operations, in the first quarter ended May 4, compared to a loss of C$398 million, or 72 Canadian cents per share, a year earlier.

First quarter net income included a C$817 million gain from the sale of the Lord & Taylor flagship building in New York.

Excluding items, the company posted a loss of 87 Canadian cents per share, wider than the 56 Canadian cents loss based on estimates from 2 analysts, according to IBES data from Refinitiv.

Total revenue fell to C$2.12 billion from C$2.19 billion, a year earlier.

By Shanti S Nair; editor: Shailesh Kuber.