Saks Loses $25M in First Quarter but Has Cash on Hand of $100M

The balance sheet news wasn't all bad, however, for the Alabama company that operates Saks Department Store Group and Saks Fifth Avenue Enterprises. Saks reduced its debt load by $287 million to $1.34 billion and borrowed nothing under its $700 million revolving credit facility.

"The debt balance at May 4 is approximately $643 million below the level at the end of the first quarter two years ago," Saks chairman/CEO R. Brad Martin says in a prepared statement.

Cash on hand, one of the most important items in a profit-and-loss statement, totaled $100 million. The company's conference call to discuss first-quarter results is set for 10 a.m. today at 816 650 0742.

Operating income by segment shows the company took in $65.7 million versus $62.8 million a year ago. The department store category logged $40.5 million compared to $38.9 million last. Saks Fifth Avenue Enterprises recorded $35.2 million compared with $30.8 million in first quarter 2001.

Other segments of the company, however, showed a loss of $10 million versus a loss of $6.9 million last year.

Sales were down in both divisions. Total sales for owned stores and leased department commissions in the department store segment were $818.2 million versus $825.3 million a year ago, a decrease of .98%.

Comparable results for Saks Fifth Avenue Enterprises how $608 million compared with $639 million a year ago, a drop of 4.98%. Total first-quarter sales of $1.42 billion compared with $1.46 billion in first quarter 2001.

Still, Saks' Martin was pleased with the company's overall operating performance. "Our comparable store sales results for the quarter exceeded those of our traditional and luxury department store peers," he says in his statement.

Martin notes the gross margin rate for the quarter was 37.6%, "a 30 basis point improvement over last year and slightly ahead of our expectations."

Saks Inc. operates 243 department stores with 26.6 million sf; 61 Saks Fifth Avenue stores with 6.3 million sf; and 52 Off 5th stores with 1.4 million sf.