Neiman Marcus Reports Wider Net Loss, Falling Sales
11 Juni 2019 - 05:16PM
Dow Jones News
By Aisha Al-Muslim
Neiman Marcus Group Ltd. had a wider net loss and lower revenues
in the latest quarter as the department-store owner faced lower
same-store sales.
The closely held Dallas-based luxury retailer reported total
revenue for the third quarter dropped more than 9% to $1.05
billion. Same-store sales fell 1.5% from a year earlier.
Neiman Marcus recorded a net loss of $31.2 million, compared
with a net loss of $19.9 million, a year earlier. Operating
earnings fell more than 19% to $41.2 million.
Neiman Marcus owns it namesake stores, as well as Bergdorf
Goodman, Last Call, Horchow, Cusp, and Mytheresa retail brand
names. The luxury retailer has continued to invest in its business,
integrating its e-commerce and store operations and opening a
flagship store in New York City's Hudson Yards development in
March.
Neiman, like Hudson's Bay Co., Macy's Inc., J.C. Penney Co. and
other retailers, has struggled with the consumer shift toward
online shopping and new competitors that make it hard to raise
sales at its core department-store holdings.
On Monday, a group of Hudson's Bay Co. shareholders that
includes the retailer's chairman made an offer to take the company
private. Hudson's Bay owns Saks Fifth Avenue and Lord &
Taylor.
Leading the offer is company Chairman Richard Baker, Rhône
Capital LLC, WeWork Property Advisors and other shareholders that
together control 57% of the shares outstanding. The offer values
Hudson's Bay at 9.45 Canadian dollars ($7.12) a share -- a 48%
premium to the company's closing share price Friday.
Hudson's Bay also held discussions in 2017 about acquiring
Neiman Marcus, but it resulted in no deal.
Recently, Neiman Marcus has pushed its lenders into refinancing
its debt load set to mature over the coming years. Neiman Marcus
offered existing lenders a debt exchange deal that would leave
those that don't participate more exposed to losses if the company
files for bankruptcy down the road.
In the recent quarter, ended April 27, the company's adjusted
earnings before interest, taxes, depreciation and amortization, or
Ebitda, was $126.5 million, down from $143.8 million a year ago. It
had $4.46 billion in long-term debt.
Neiman Marcus accumulated its debt over two private-equity
buyouts. Its current owners are Ares Management LLC and the Canada
Pension Plan Investment Board.
(END) Dow Jones Newswires
June 11, 2019 11:01 ET (15:01 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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