Le Château records rocky first quarter
today Jun 30, 2019
Canadian retailer Le Château reported a sales loss for its first quarter, following a year of store closures.
Sales for the quarter ended April 27, amounted to $36.1 million, down by 12.2 percent from $41.1 million last year, with 18 fewer stores in operation.
Comparable store sales, which include online sales, were equally down 5.9 percent versus the same period a year ago. Comparable regular store sales decreased 6.9 percent, while comparable outlet store sales managed to jump 2.3 percent.
Negative sales were due to unseasonable weather conditions, the company said.
Net loss for the quarter amounted to $10.8 million or $0.36 loss per share compared to a net loss of $10.8 million or $0.36 loss per share for the same period last year.
During the first quarter 2019, the company continued to close underperforming stores including six locations. It closed 20 stores last year and announced plans to close a total of 10 locations this year.
Le Château has been in the midst of a “store optimization program” for the last three years that is finally coming to an end. The program will help recalibrate its retail network, by closing underperforming stores, and allow the company to focus on its e-commerce business in order to improve margins.
“As the company exits this critical phase, management will be in a better position to focus its energy on re-building the position of the brand in an era where on-line shopping has become an increasingly important pillar in the strategy of retailers,” Le Château said in late May, at the time of reporting its fiscal 2018 results.
The company currently operates 133 stores and plans to close four additional stores during the remainder of 2019.
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