Posted: Aug 22, 2013 5:56 AM
Updated: Aug 22, 2013 5:57 AM
HOUSTON (AP) Stage Stores Inc.'s fiscal second-quarter net income tumbled 18 percent, and the department store operator lowered its expectations for the year, as promotions and a sales shortfall in one part of its business held back earnings.
The Houston company said Thursday it earned $9.6 million, or 29 cents per share, in the quarter that ended Aug. 3. That compares to earnings of $11.7 million, or 37 cents per share, in last year's quarter.
Earnings excluding costs tied to the consolidation of its South Hill, Va., operations totaled 41 cents per share. Revenue climbed more than 3 percent to $395.3 million.
That missed Wall Street expectations. Analysts predicted, on average, earnings of 46 cents per share on $402.4 million in revenue, according to FactSet.
Stage runs department stores mostly in small- and mid-sized communities under several names, including Bealls, Goody's and Peebles. It has 872 stores in 40 states. The company also has a buying office in South Hill, Va., and it said in February it would move those operations to its corporate headquarters.
The company said Thursday that back-to-school sales helped its business toward the end of the quarter, but it also saw a shortfall in sales from its South Hill Stores.
"While the operational components of the consolidation have been completed, the alignment of merchandise assortments in the stores is taking longer than expected," CEO Michael Glazer said in a statement.
Revenue from the company's men's, children's junior's, cosmetics and footwear categories climbed at established stores.
Stage also saw selling, general and administrative expenses rise nearly 5 percent to $99.3 million.
The company now expects adjusted earnings of $1.30 to $1.40 per share for fiscal 2013, down from its previous forecast for earnings of $1.45 to $1.55 per share.
Analysts expect, on average, earnings of $1.47 per share.
Shares of Stage closed at $21.29 on Wednesday and have slipped 14 percent so far this year.