Christopher & Banks Corp.’s stock tumbled 14 percent Thursday, extending a decline that wiped out half its value over the past month, after executives forecast pressure on sales and margins into the fall.
The women’s apparel retailer, based in Plymouth, in mid-August warned investors that it encountered difficulties during the May-to-July period, its fiscal second quarter. The extent of the damage became clear in its quarterly results announcement Thursday morning: a net loss of about $700,000 and steep drop in sales.
In a call with analysts, Chief Executive LuAnn Via described several merchandising missteps in the quarter, specifically too much fashion-oriented product and not enough classic styles.
“We know it is important to offer newness to our customer,” she said. “However, we need to skew our mix more toward ease and comfort and by offering a better balance of updated and classic styling.”
She said the company is rebalancing its offerings and has seen some improved results in recent weeks. Some benefits of the changes won’t be realized until the holidays or early next year, Via added.
Christopher & Banks just began a reorganization of its merchandising department, creating three separate functions in product development, production and sourcing, and buying. Via said two executives — the general merchandise manager and the vice president of planning — will be leaving the company.
For the quarter ended Aug. 1, Christopher & Banks reported a net loss of $700,000, or 2 cents a share. A year earlier, it earned $3.4 million.
Sales amounted to $94 million, down 12 percent from $106.6 million a year ago. The company’s store base was about 4 percent smaller than it was a year ago due to makeover effort, which has resulted in some closings, some consolidations of its main brand store with its misses and petite-size store, and some store openings.
Same-store sales fell 12.4 percent in the quarter. On Thursday, its stock closed at $1.38. It’s a big drop from last September, when shares reached $11.22.
The retailer was in the midst of a solid recovery in sales and profits until last fall, when its sales began tumbling. Company executives blamed industrywide declines in misses’ apparel, declining mall traffic, and the impact of delayed shipments due to the West Coast port strike.