Hudson’s Bay Co. has lowered its full-year outlook yet again as pressures in the luxury good sector continue to weigh on the firm.
The Canada-based owner of Saks Fifth Ave., Lord & Taylor and other luxury department stores said Monday that given the company’s lower-than-expected sales results for the holiday selling period, it now expects full-year sales in the range of $14.4 billion to $14.6 billion CAD. The new range represents another downward adjustment to a previously lowered sales range of $14.5 billion to $14.9 billion CAD, provided in November.
HBC CEO Jerry Storch said that despite seeing strong digital sales growth during the holiday period, currency fluctuations, a “challenging” U.S. retail environment and hefty promotional activity continue to hinder the firm.
“As we head into the new fiscal year, we are focused on continuing to delight our customers with exclusive product offerings and custom all-channel shopping experiences, and by creating exciting retail destinations to increase foot traffic in our stores,” Storch said in a release Monday, noting that the sales improvement in the current quarter was not strong enough to receive the results the firm had expected.
He added, “The retail environment is clearly changing, and we continue to work diligently across all of our banners to adapt rapidly.”
During the nine-week period ended Dec. 31, HBC said its total comparable sales slipped 2 percent.
By division, Saks Fifth Avenue saw a comparable sales decrease of 0.5 percent; comps at HBC Off Price (Saks Off 5th and Gilt) dropped 5.2 percent; the Department Store Group (Hudson’s Bay, Lord & Taylor and Home Outfitters) registered a comp decline of 0.7 percent. HBC Europe’s comparable sales dipped 0.6 percent.
Total digital sales, which include Gilt on a pro forma basis, increased 14.7 percent. Excluding Gilt, total digital sales advanced 21.7 percent on a constant currency comparable basis.