Hancock Fabrics posts $11.3M loss

By Carlie Kollath/NEMS Daily Journal

BALDWYN – Hancock Fabrics in fiscal year 2011 widened its losses to $11.3 million, the company reported Friday.
The company’s fiscal year ended Jan. 28. In the previous fiscal year, the fabric and craft retailer posted a $10.5 million loss.
Sales also slipped in the most recent fiscal year to $272 million, compared to $275.5 million in fiscal year 2010. Comparable store sales – sales at stores open for more at least a year – were down 0.8 percent, compared to a 0.1 percent decrease for the previous year.
During 2011, the company opened one store, closed three locations and relocated five stores, ending the year with 263 stores.
The bright spot in Hancock’s filing was its fourth-quarter sales, which grew 4.5 percent to $81.4 million compared to the prior-year quarter.
The company also narrowed its quarterly loss to $5.2 million, compared to a net loss of $9.8 million in the fourth quarter of fiscal year 2010.
Steve Morgan, Hancock’s president and CEO, said the company had its best fourth-quarter comp-store sales since 2002. As in previous news releases, Morgan cited “inherited inventory challenges of missed merchandise buys in the latter half of 2010 intended for 2011 sales.”
Morgan became the interim president and CEO in January 2011 after the board did not renew Jane Aggers’ contract. In October 2011, he was appointed to the position full time.
In addition, Morgan said the company in January hired Dennis Lyons as its new senior vice president of store operations. The company also hired a new vice president of marketing in April.
“These additions complete the revamping of all areas of our business and we now have the talent and experience throughout our organization to be successful in 2012 and into the future,” Morgan said in a news release.
“In addition to other initiatives undertaken in preparation for this year, we have recently cut an additional $4.2 million of expense annually in order to improve profitability as we move forward. We continue to feel good about this team and the momentum we are taking through the first quarter.”
carlie.kollath@journalinc.com