A year of trials and errors took its toll on Wilsons the Leather Experts finances Tuesday as the chain sunk to a loss because of charges for its plan to close more than half of its 260 mall stores.
Wilsons' CEO Michael Searles said it was a disappointing year, as worried consumers couldn't be swayed into stores, even though the chain had begun selling designer coats and jackets from Calvin Klein and Nine West.
Searles said the company made "significant improvements and discoveries that will have a long-term impact on our operating results," but it wasn't enough.
"The bottom line is that we didn't turn the business around, and we disappointed our customers, our employees and our shareholders," Searles said in an afternoon conference call.
Wilsons announced last month that its name soon will be gone from store doors, and 160 mall-based stores will be shuttered by the end of June. The 100 remaining mall stores are being rebranded as "Studio," and will focus on handbags from known and emerging designers priced between $100 and $400.
Its 110 outlet stores will continue to operate as Wilsons.
For the quarter ending Feb. 2, the Brooklyn Park-based specialty retailer reported a loss of $8.4 million, or 23 cents a share, which included a $19.7 million store-closing charge. Last year, the company posted a profit of $21 million, or 31 cents a share. Without the charge, earnings would have been $11.3 million, or 16 cents a share.
Sales in the crucial quarter fell 8.7 percent to $121.4 million, compared with a year ago. For stores open more than a year, sales fell 2.4 percent. Historically, Wilsons has lost money in every quarter but the last.
