Bon-Ton posts sales drop, reports delisting risk
Leaders at The Bon-Ton Stores Inc. remain optimistic that the department-store chain will bounce back despite eroding financials that could lead to the company being delisted from the Nasdaq stock exchange.
Bon-Ton reported its fourth quarter and fiscal year earnings on Wednesday, which show declining store traffic and a drop in sales.
Comparable store sales fell 4.7 percent in the fourth quarter and 3.8 percent for the fiscal year that ended Jan. 28.
The company also posted net income of $44.7 million in the fourth quarter, down from $50.6 million in the previous year. For the full fiscal year, Bon-Ton saw its net loss widen to $63.4 million, up from a net loss of $57.1 million in the previous year.
Kathryn Bufano, the company's president and CEO, cited continued weak traffic and warm weather this winter as reasons for the fourth-quarter decline. But, she said, the company is making progress on initiatives designed to differentiate the chain.
One of those initiatives is "Close to Home," a local sourcing initiative launched last year. Bufano sees the localization strategy paying off, while the company continues to reduce costs through better inventory management.
The company also had four store closings last fiscal year that are expected to generate savings in the current year.
No new store closings have been announced, but officials said leases are always being reviewed.
Ahead of the company's financial report, the Nasdaq sent a letter to the company on March 9 notifying it that the market value of publicly held shares of company stock was less than $15 million for 30 consecutive business days, which puts the company out of compliance for continued listing on the exchange.
Bon-Ton has 180 calendar days, or until Sept. 5, to regain compliance with the NASDAQ, according to the letter.
Company shares, traded under the ticker symbol BONT, were trading at just above $1 this morning. The stock was trading around $1.50 per share to start the calendar year, but has fallen to a 52-week low in recent trading.
Bon-Ton operates 263 stores in 25 states under the Bon-Ton, Bergner's, Boston Store, Carson's, Elder-Beerman, Herberger's and Younkers nameplates.