Talbots reports big Q4 loss
The Talbots Inc. reported a net loss totaling $366.5 million, or $6.85 per share, for the fourth quarter ended January 31. This compares to a net loss totaling $171.4 million, or $3.22 per share, in the previous fourth quarter period.
For the fiscal year, the net loss totaled $560.6 million, or $10.49 per share. This compares with the previous year's net loss of $188.8 million, or $3.56 per share.
“The current economic environment is the most challenging we have faced in the company's greater than 60 year history,” said Trudy F. Sullivan, president and CEO at Talbots, in a statement. “Nevertheless, throughout 2009 we will remain customer focused as we continue with the evolution of our brand while operating in a most conservative manner. We remain firm in our conviction in Talbots long-term strategic plan and steadfast in our commitment to reenergize the brand and believe we will be better positioned for success on the top and bottom line when the environment improves.”
Talbots also said that Aeon Co. Ltd., which, through its wholly owned subsidiary, is the company's majority shareholder, has provided Talbots a new $150 million secured revolving loan facility.
In other news, Talbots said it is has signed a non-binding letter of intent with Li & Fung Limited, the global sourcing and trading firm based in Hong Kong, to mutually explore a potential relationship for Li & Fung Limited to become Talbots primary global sourcing agent.
These moves follow a series of steps taken over the past year by Talbots to reduce costs and strengthen the company going forward including workforce reductions; the elimination of merit increases in 2009; exiting non-core concepts Talbots Kids, Talbots Mens and Talbots UK; and pursuing the sale of J. Jill.
The company previously reported that sales for the 13 weeks ended January 13 totaled $327.9 million compared to last year's sales of $427.7 million. Comparable store sales dropped 24.6% for the period.
Fourth quarter direct marketing sales totaled $49.2 million, compared to $66.5 million last year.
For the fiscal year, net sales totaled $1.495 billion compared to $1.708 billion in the previous year. Comparable store sales declined 14.2% during the same period. Direct marketing sales totaled $233.7 million compared with $262.7 million in the previous year.