Financial Reports: Eddie Bauer, Harry & David

Higher Sales, Wider Loss for Eddie Bauer
First-quarter direct sales at Eddie Bauer Holdings increased 16.5%, to $63.6 million for the three months ended March 31. Total first-quarter revenue rose 10%, to $214.0 million from $194.5 million. Same-store sales increased 9.5%.

The Redmond, WA-based apparel merchant reported a first-quarter net loss of $44.8 million, compared with the net loss of $35.6 million a year ago. Several nonrecurring expenses contributed to this year’s first-quarter loss, including a previously announced $5 million merger termination fee and $1.4 million in legal fees and expenses related to the company’s proposed sale to Sun Capital Partners and Golden Gate Capital, $8.4 million of expenses related to the resignation of the company’s former CEO, and a $1.6 million legal settlement.

Interim CEO Howard Gross said customers have responded well to a new merchandise assortment that “is more in line with the needs and preferences of our core customers and capitalizes on our brand’s unique outdoor heritage.”

Harry & David Trims Quarterly Loss
Third-quarter net sales at Harry & David Holdings increased 4%, to $98.2 million for the 13 weeks ended March 31. This increase helped the Medford, OR-based merchant reduce its net loss to $16.8 million from $19.5 million for the comparable quarter of last year.

Net sales for the direct marketing division, which includes the Harry & David food gifts catalogs and Website, the catalog and Web business of horticultural mailer Jackson & Perkins, and outbound telemarketing sales, rose nearly 5%, to $47.6 million. Net sales for Harry & David stores fell 4%, to $20.5 million, largely due to the decision not to continue offering discounted gift cards.

Harry & David sold most of the assets of Jackson & Perkins last month for roughly $21 million. (See ”Harry & David Sells Off Jackson & Perkins.”)

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