Charlotte, North Carolina-based retailer of apparel and accessories for women, Cato Corporation (CATO) reported an 8% decline in comparable-store sales (comps) for the 4 weeks ended Feb 1, 2014. The decline was due to unfavorable weather conditions in January.
Net sales for January were down 25% to $48.1 million from $63.8 million in the five weeks ended Feb 2, 2013. On a four-week comparable basis, sales declined 4% from the previous year.
For the fourth quarter ended Feb 1, Cato reported sales of $215.5 million, declining 7% from the year-ago quarter figure of $232.0 million. On a comparable 13-week basis, sales were down 1% while comps decreased 3%.
The fiscal year ended Feb 1, 2014 had 52 weeks compared with 53 weeks in the previous fiscal ending on Feb 2, 2013. Moreover, Jan 2014 has one lesser week against 5 weeks in Jan 2013. Hence, there were 13 weeks in the fourth quarter ended Feb 1, 2014 versus 14 weeks in the year-ago quarter.
In fiscal 2013, Cato’s sales fell 2% to $910.8 million from $933.8 million during the same time period in the prior year. However, on a comparable 52-week basis, total sales registered a decline of 1% while comps for the period slid 3% from the previous fiscal.
Despite weak top-line performance in the quarter, the company has maintained its previous earnings guidance range of 11 cents to 15 cents per share for the fourth quarter and $1.84 to $1.88 per share for the full fiscal. The Zacks Consensus Estimate for both the fourth quarter and the fiscal is 13 cents and $1.86 per share, respectively.
In Jan 2014, the company opened 6 stores and shuttered 2 outlets. As a result, the total number of stores opened and closed during the fourth quarter was 16 and 14, respectively. Moreover, Cato relocated one store. In the fiscal, the company opened 32 stores, closed 22 outlets and relocated 5 stores. As of Feb 1, 2014, this leading specialty retailer of women's fashions and accessories operated about 1,320 stores across 32 states.
Apart from Cato, other store chain retailers who were hard hit by harsh winter storms in January include The Buckle Inc. (BKE), Zumiez Inc. (ZUMZ) and J. C. Penney Company, Inc. (JCP). Comps for Buckle, Zumiez and J. C. Penney were down 6.6%, 7.6%, and 3% respectively.
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