Birmingham, AL, August 15, 2006--Saks Inc., posted a second-quarter loss Tuesday, reversing a year-earlier profit, due in large part to sharply lower revenue following the sale of its Northern Department Store Group.
For the quarter ended July 29, the company's loss totaled $51.9 million, or $0.38 per share, versus a prior-year profit of $8.2 million, or $0.06 per share.
The quarter's results include charges totaling $13.9 million for stock options, severance and asset impairments and sales.
Revenue fell 37 percent to $760.7 million from $1.21 billion in the year-earlier period. Saks blamed the sales decline on the sale of its Northern Department Store Group business to Bon Ton Stores Inc. in March.
Wall Street had forecast a loss of $0.19 per share, the mean estimate of 10 analysts surveyed by Thomson Financial, on projected sales of $772.7 million.
Sales in stores open at least one year--or same-store sales--rose 2.9 percent. Same-store sales are considered a strong indicator of a retailer's health.
Saks has been shedding its mid-brow department stores to concentrate on its luxury business.
In July 2005, Belk, the nation's largest privately owned department store operator with 277 stores in 16 Southeastern states, bought Saks' Proffitt's and McRae's businesses for $623 million in July 2005.
Earlier this month, Belk announced that it was buying Saks' Parisian specialty department store chain for $285 million in cash.
After divesting Parisian, Saks will be left with Saks Fifth Avenue Enterprises comprising the flagship Saks Fifth Avenue chain and outlet stores. It will also still retain Club Libby Lu, a specialty retail chain.
