Le Château ends year with sales drop, plans more store closures

By

Jennifer Braun

Published
May 28, 2019

Canadian retailer Le Château reported a sales loss for the year on Monday, following a difficult twelve months involving over 20 store closures with more expected to be on the way.   

 
Sales for the year ended January 26 amounted to $190.9 million, down 6.6 percent, as compared with $204.4 million last year, with 21 fewer stores in operation.
 
Comparable store sales, which include online sales, increased 1.1 percent versus the same period a year ago, with comparable regular store sales increasing 0.7 percent and comparable outlet store sales increasing 3.6 percent. 

Net loss for the year amounted to $23.8 million or $0.79 loss per share compared to a net loss of $24 million or $0.80 loss per share the previous year.
 
Likewise, sales for the fourth quarter were down 8.3 percent at $51.4 million as compared with $56 million reported during the same quarter last year. 
 
Online sales weren’t able to stop comparable store sales from decreasing 1.7 percent during the quarter, with comparable regular store sales decreasing 2.1 percent and comparable outlet store sales increasing 0.8 percent. 
 
During the year, the company renovated two existing locations and, as planned, closed 21 underperforming stores – a “noteworthy progress in its retail right-sizing strategy," the Montreal-based company said.
 
Looking ahead, the company announced plans to close another 10 stores this year with total square footage declining to approximately 703,000 square feet.
 
“As the company exits this critical phase, management will be in a better position to focus its energy on re-building the position of the brand in an era where on-line shopping has become an increasingly important pillar in the strategy of retailers,” Le Château said.

Last year, it closed closed 27 stores as part of its retail right-sizing strategy. It currently operates 139 stores.