Goodwill charge boosts Q4 loss at Hudson’s Bay to $152 million

By The Canadian Press

TORONTO – Hudson’s Bay Co. (TSX:HBC) is reporting a $152-million net loss in the fiscal fourth quarter ended Jan. 28, boosting its loss for the fiscal year to $516 million.

A year ago it reported earnings of $370 million for the quarter and $387 million for the year.

The fourth-quarter loss includes a one-time non-cash goodwill impairment charge of $116 million driven by weak sales at its Gilt and Saks Off 5th businesses, while it had $333 million in net gains in the year-earlier period due to the sale of investments in joint ventures.

The fourth-quarter loss came despite a 2.5 per cent increase in retail sales to $4.6 billion and a 13 per cent increase in comparable digital sales on a constant currency basis, the company says.

HBC says it will budget between $450 million and $550 million in capital spending this year, about $150 million less than it spent last year.

In January, the company announced it would cut $75 million from annual costs.

“We are cutting expenses, rationalizing and reallocating our capital spending, strengthening our balance sheet, and taking other necessary actions,” says CEO Jerry Storch in a statement released after markets closed.

“Rest assured, as we remain focused on the continued growth of our company, we are aggressively positioning HBC to adapt to the changing retail environment.”

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