Stage Stores, Inc. (NYSE:SSI) today reported comparable sales
for the holiday period. On a shifted basis, which compares the
nine-week period ended January 5, 2019 compared to the nine-week
period ended January 6, 2018, Gordmans off-price stores comparable
sales increased 2.4%, department stores comparable sales decreased
0.4%, and total company comparable sales increased 0.1%. E-commerce
continued its trend of double digit sales growth.
The company also announced its strategy to convert approximately
220 additional department stores to Gordmans off-price stores by
the middle of 2020. With the acceleration of the conversion of
department stores to the off-price model, the company will suspend
its quarterly dividend and expects to spend approximately $35
million in capital in 2019.
Michael Glazer, President and Chief Executive Officer,
commented, “The results of department stores converted to off-price
continue to exceed our expectations, with smaller stores more than
doubling their volume after conversion. Off-price stores, when
compared to our department stores, also benefit from a higher
penetration of outperforming non-apparel categories. As a result,
off-price comp sales once again increased during the holiday
period, despite the headwind created by the November 2017 marketing
relaunch. In department stores, while apparel sales continue to be
challenged, we delivered strong results in non-apparel, with home
and gifts increasing more than 20% and representing more than 10%
of sales. Additionally, we expect to end the year with more than
$100 million of excess availability under our credit facility.
“Turning to 2019 and beyond, I am thrilled to announce our
multi-year off-price conversion plan. By the end of 2020, we expect
to have nearly 300 Gordmans stores, representing almost 50% of
total sales volume. We plan to convert approximately 70 stores in
2019, predominantly in the smaller, mid-western markets where we
have seen outstanding results to date. We are looking forward to
announcing our full year 2019 guidance, including the impact our
multi-year conversion strategy, in March, in conjunction with our
fourth quarter earnings release.”
The comparable sales calculation for the holiday period and
going forward includes converted stores. For 2018 this encompasses
one store converted in the first quarter, four stores converted in
the third quarter, and four stores converted in the fourth quarter.
In addition, a non-cash impairment charge related to the $14.9
million intangible asset associated with the Peebles trade name may
be incurred in the fourth quarter 2018 due to the multi-year
conversion plan. Though there are several weeks left in the
quarter, fourth quarter EBITDA is expected to be approximately $30
million. This excludes the potential non-cash impairment charge
related to the Peebles trade name.
About Stage
Stores
Stage Stores, Inc. is a leading retailer of trend-right,
name-brand values for apparel, accessories, cosmetics, footwear and
home goods. As of January 14, 2019, the Company operates in 42
states through 752 BEALLS, GOODY'S, PALAIS ROYAL, PEEBLES, and
STAGE specialty department stores and 68 GORDMANS off-price stores,
as well as an e-commerce website at www.stage.com. For more information about Stage
Stores, visit the Company’s website at corporate.stage.com.
Caution Concerning
Forward-Looking Statements
Certain statements in this release are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995, and such statements are intended to qualify for
the protection of the safe harbor provided by the Act. The words
“anticipate,” “estimate,” “expect,” “objective,” “goal,” “project,”
“intend,” “plan,” “believe,” “will,” “should,” “may,” “target,”
“forecast,” “guidance,” “outlook” and similar expressions generally
identify forward-looking statements. Similarly, descriptions of the
Company’s objectives, strategies, plans, goals or targets are also
forward-looking statements. Forward-looking statements relate to
the expectations of management as to future occurrences and trends,
including statements expressing optimism or pessimism about future
operating results or events and projected sales, earnings, capital
expenditures and business strategy. Forward-looking statements are
based upon a number of assumptions concerning future conditions
that may ultimately prove to be inaccurate. Forward-looking
statements are based upon management’s then-current views and
assumptions regarding future events and operating performance.
Although management believes the expectations expressed in
forward-looking statements are based on reasonable assumptions
within the bounds of its knowledge, forward-looking statements
involve risks, uncertainties and other factors which may materially
affect the Company’s business, financial condition, results of
operations or liquidity.
Forward-looking statements are not guarantees of future
performance and actual results may differ materially from those
discussed in the forward-looking statements as a result of various
factors, including, but not limited to, economic conditions, cost
and availability of goods, inability to successfully execute
strategic initiatives, competitive pressures, economic pressures on
the Company and its customers, freight costs, the risks discussed
in the Risk Factors section of the Company’s most recent Annual
Report on Form 10-K as filed with the Securities and Exchange
Commission (“SEC”), and other factors discussed from time to time
in the Company’s other SEC filings. This release should be read in
conjunction with such filings, and you should consider all of such
risks, uncertainties and other factors carefully in evaluating
forward-looking statements.
You are cautioned not to place undue reliance on forward-looking
statements, which speak only as of the date thereof. The Company
undertakes no obligation to publicly update forward-looking
statements, whether as a result of new information, future events
or otherwise. You are advised, however, to consult any further
disclosures the Company makes on related subjects in its public
announcements and SEC filings.
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version on businesswire.com: https://www.businesswire.com/news/home/20190114005146/en/
Jean Fontana646-277-1214(Jean.Fontana@icrinc.com)
Stage Stores (NYSE:SSI)
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