NEW YORK – Department store operator Saks Inc. (SKS) Tuesday posted an unexpected loss for its third quarter on hurricanes in the southeastern United States and charges for the closure of some stores, sending its shares down more than 6 percent.
The company, whose department stores include Saks Fifth Avenue (search), Proffitt's and McRae's, lost $24.8 million, or 18 cents per share, in the third quarter ended Oct. 30, compared with a profit of $12.4 million, or 9 cents a share, a year earlier.
Analysts on average had expected earnings of 4 cents a share, according to Reuters Estimates.
The Birmingham, Ala.-based company said it was hit in the third quarter by charges of $17.5 million, or 13 cents a share, primarily related to the planned closing of 12 Saks Fifth Avenue stores. It also estimated that the hurricanes wiped 3 cents per share off quarterly earnings.
Third-quarter sales rose 1 percent to $1.48 billion with sales at stores open at least a year, a gauge known as same-store sales, edging up just 0.3 percent.
The Saks Fifth Avenue group reported a 5.6 percent sales increase, while the other department stores posted a 2.2 percent decrease.
Chief Executive R. Brad Martin said a difficult sales trend that emerged in the second quarter persisted through the third quarter and led to a performance below expectations.
"For the fourth quarter, management anticipates flat comparable store sales at (its department stores) with a continuation of the more favorable sales environment at (Saks Fifth Avenue) store," the company said in a statement.
Saks shares were down 86 cents at $12.95 on Tuesday on the New York Stock Exchange (search).