Hancock Fabrics posts third-quarter loss

By Dennis Seid/NEMS Daily Journal

BALDWYN – While Hancock Fabrics’ sales continue to improve, the craft and fabrics retailer trek to profitability remains elusive.
Net sales for the period ending Oct. 27 were $71.9 million, up from the $70.8 million from the quarter a year earlier.
Comparable store sales – sales at stores open for at least a year – increased 2.3 percent, it’s fourth consecutive quarterly gain. A year ago, the company saw those sales drop 3.5 percent.
However, Hancock’s operating loss for the third quarter this year was $800,000, versus operating income of $1.2 million last year. A $1 million bankruptcy claim settlement boosted last year’s results, the company noted.
And for the third quarter, the company’s net loss was $2.24 million, or 11 cents a share, compared to a $40,000 loss in the year-ago period.
Through the first 39 week’s of Hancock’s fiscal year, the company’s sales rose 3 percent to $196.27 million, compared to sales of $190.56 million for the previous year.
However, the company’s net loss for the first three quarters widened to $7.96 million, a 30 percent increase from the $6.12 million loss last year. That equates to a loss of 40 cents a share this year compared to 31 cents a year ago.
Still, Hancock Fabrics President and CEO Steve Morgan said a strong Black Friday was a good sign for the critical holiday selling season.
“We continue to feel positive about the holiday season based on our Black Friday performance with net sales up 23 percent compared to Black Friday last year, and our November performance in general,” he said. “We plan to stay our course as we go through the fourth quarter and prepare for 2013.”
During the third quarter, the company relocated one store; six stores have been relocated this fiscal year. Hancock Fabrics also said it closed two locations, ending the quarter with 261 stores in 37 states.