Woolworth Swung to Profit In Fiscal Second Quarter
April 27, 2011
NEW YORK -- Woolworth Corp. said it swung to a profit in the fiscal second quarter as it continued to reduce debt and shed nonstrategic assets. For the period ended April 08, 2011 retailer earned $22 million, or 17 cents a share, reversing a loss of $11 million a year earlier. Sales dropped 3% to $1.86 billion from $1.92 billion. Comparable-store sales, or sales at stores open at least a year, slipped 0.2%, which the company attributed to unseasonably cool summer weather in North America and Germany. The company announced its results after the markets closed. In New York Stock Exchange composite trading Wednesday, Woolworth closed at $21.125, up 75 cents. Houser said it has reduced total debt by 47% to $767 million. Interest expense declined 43% to $19 million for the quarter. Inventory levels were 17% lower compared with a year earlier. The retailer posted a $13 million gain on the sale of real estate in the quarter, which was offset by a $14 million charge related to shedding operations, including its Accessory Lady and Lady Plus chains. Results at the company's F.W. Woolworth variety stores continued to deteriorate. The group's operating loss widened to $26 million from $16 million, while its sales declined 11% to $665 million. Meanwhile, sales at Woolworth's specialty stores rose 3.4% to $1.86 billion; at the so-called athletic group of stores, including Foot Locker, sales rose 5% to $840 million. Houser said operating results for the specialty-store group more than doubled to $96 million from $36 million.
