The new CEO at the women's specialty retailer said losses are narrowing; same-store sales rise.
Improving sales at its remaining stores and a lower net loss in the second quarter are evidence that a turnaround strategy is getting traction, retailer Christopher & Banks Corp. said after the stock market closed Wednesday.
Christopher & Banks, a women's specialty apparel retailer based in Plymouth, said net sales slipped to $103.4 million from $105.6 million in the second quarter of 2011. However, the company operated 15 percent fewer stores during the period. And same-store sales grew 5.5 percent.
Meanwhile, the net loss was $2.2 million or 6 cents per share, in the second quarter, compared with $6.2 million, or 18 cents per share, in the second quarter of 2011.
In a conference call with analysts, CEO Joel Waller said, "We made significant progress on strategic initiatives during the second quarter and we are beginning to see some of the benefits of our efforts even sooner than we anticipated.
"Our comparable store sales [stores open at least a year], merchandise margin rate and inventory levels all showed significant improvement, demonstrating that our strategic initiatives are taking hold. We have substantially completed our real estate restructuring program and signed a new credit agreement that enhances our financial flexibility. Overall, the second quarter was a pivotal period for Christopher & Banks and we look forward to building continued momentum in the second half of fiscal 2012 and beyond."
Waller, a veteran retailer who was recruited by the board for the turnaround, said the company is selling more "value-oriented" products including classic cotton blouses and printed T-shirts. It streamlined offerings around popular clothing that carries lower price tags, and that has led to higher sales volume.
A private-label credit card, introduced in April, already has exceeded its full-year goal for completed applications. And those customers are spending about $62 per visit, more than 50 percent above the average sale during the April-through-July period.
Christopher & Banks entered into a new secured lending relationship with Wells Fargo Capital Finance of up to $50 million through July 2017, replacing a credit facility that was scheduled to mature in June 2014. The company improved its cash position during the second quarter as it reduced its inventory and closed weaker stores.
Waller predicted positive same-store sales for the second half of the fiscal year.
Christopher & Banks, which has seen its stock price cut from $10 per share to under $1.50 in July, rebuffed a $64 million purchase offer a month ago. The stock closed down a penny at $2.36 Wednesday, but jumped 5.1 percent to $2.48 in after-hours trading.
Neal St. Anthony • 612-673-7144