Collective Brands swings to loss in Q3, accelerates closures
Topeka, Kan. -- Collective Brands Inc., parent of Payless ShoeSource, reported Monday that it swung to a loss of $114.3 million in the quarter ended Oct. 29, compared with a profit of $47.6 million in the year-ago period. Excluding a tax-related charge, the retailer would have gained $37.1 million in the quarter.
Revenue edged up 1.4% to $894.4 million, missing Wall Street’s expected $908.1 million in revenue. Sales were weighed down by Payless, where they fell 5.1%. Same-store sales in the United States dropped 3.7%, and the decline was 4.5% at Payless units.
As announced previously, the company reiterated it will shutter 475 underperforming stores in the next three years — 400 Payless stores in the United States, Canada, and Puerto Rico and 75 Stride Rite Children's stores. It said it will accelerate the timeframe, saying now it will close approximately 350 of those stores — instead of the previously announced 315 — this year.
“Our operating results in the third quarter reflect both the challenges we are facing as well as opportunities we see for marked improvement at Collective Brands," said Michael J. Massey, CEO.