Home » NEWS » Hancock Fabrics' sales up, but still records net loss

Hancock Fabrics' sales up, but still records net loss

BALDWYN — Hancock Fabrics Inc., for its first quarter ended April 28, reports an operating loss of $1.2 million, compared to a $1.0 million loss in the first quarter of last year.

The net loss was $2.4 million, or $0.12 per basic share, compared to a net loss of $2.2 million, or $0.11 per basic share, in the first quarter of fiscal 2011.

Adjusted EBITDA totaled $207,000, compared to $552,000 for the first quarter of fiscal 2011.

Net sales for the quarter increased 3.5 percent on a comparable basis to $63.9 million, compared to $62.0 million for first quarter of last year. This is an almost five percentage point improvement over the previous year comparable sales decrease of 1.3 percent.

At quarter end, the company had outstanding borrowings under its revolving line of credit of $35.5 million and outstanding letters of credit of $6.3 million. Additional amounts available to borrow under its revolving line of credit at the end of the quarter were $28.4 million. The balance of the company’s subordinated debt was $21.6 million at quarter end, and the unamortized warrant discount on this debt was $2.9 million.

Steve Morgan, Hancock Fabrics president and CEO, said, “Sales continue to ramp as we move into June, with seven months of positive comparables in a row. This is the first time that Hancock has achieved a continuous sales increase for that period of time since 2003.

“The first quarter expenses, as committed, were reduced by over $900,000 compared to last year’s first quarter, and point of sale gross margin dollars provide a $905,585 increase over last year’s first quarter – even though our increased promotional activity driven by competitive pressures decreased the point of sale gross margin rate slightly. Inventories are extremely clean and initiatives put into place over the past 8 months continue to contribute to these positive comparables. We feel optimistic about the remainder of the year.”

During the quarter, the company relocated two units, ending the quarter with 263 stores.



… we’d like to ask for your support. More people are reading the Mississippi Business Journal than ever before, but advertising revenues for all conventional media are falling fast. Unlike many, we do not use a pay wall, because we want to continue providing Mississippi’s most comprehensive business news each and every day. But that takes time, money and hard work. We do it because it is important to us … and equally important to you, if you value the flow of trustworthy news and information which have always kept America strong and free for more than 200 years.

If those who read our content will help fund it, we can continue to bring you the very best in news and information. Please consider joining us as a valued member, or if you prefer, make a one-time contribution.

Click for more info

About MBJ Staff

Leave a Reply

Your email address will not be published. Required fields are marked *